Consumer Behaviours have changed due to Covid, that has decimated Consumer Retail Sector…so what happens next?
Amidst the numerous bankruptcies and foreclosures of some the largest brands and retailers, with tens of thousands of smaller family businesses closing their doors, we are witnessing the collapse of the enitre consumer retail sector.
The consumer retail sector — shopping malls, food & beverage, entertainment, hospitality and live events, bars & clubs and restaurants has never faced a crisis like this one. Not even the 2008 financial crisis comes close. A sector that is traditionally seen as the barometer of the economy against which governments determine inflation and the health of a nation.
There is little doubt Covid19 has had a profound impact on consumer behaviours, as the world prepares for new measures as countries periodically ‘lockdown’, events conspire that compound issues for retailers delivering devastating consequences for local economies. Some place hope on a vaccine, that it will somehow return society to some normality, while others fear a two tier society will emerge. Either way the sector has to find a way to respond or all of use will be worse off, have fewer places to go and if like me you like going to resteraunts — there wont be many left.
There has been a fundamental shift in consumer behaviour, changes that introduces important strategic questions.
The key question everyone is asking: will these consumer changes be permanent?
What can retailers, mall developers and operators, grocers and convenience stores do to refine their value strategies?
How can the industry win the confidence of customers?
What should local municipalities do to avoid ‘zombie’ towns and main streets?
How do we rebuild our communities decimated by recent events?
What do owners, landlords, brands and retailers need to do next?
This document looks at the implications of these shifts, examines latest research and customer surveys conducted by the worlds leading consulting firms — McKinsey, PwC, EY and Andersen Consulting. We consider the broader insights from discussions with mall owner/operators and with real estate investors and some leading brands. We explore the emerging opportunities as the retail industry attempts to pivot and consider new strategies, while others face certain bankruptcy.
In the US it is believed 45% of malls will go bust, in the UK 50% of high street brand names have already closed their doors for good and with Arcadia group collapsing leaving a £350m pensions hole it is going to be a tough Christmas for many. There is a glut of available retail space and now commercial landlords who have been less than accommodating for their struggling tenants, are themselves now facing bankruptcy.
Reference Data: A list of reference document links used in researching this document can be fund at the end. The links also confirm the data sources and pictures, charts and maps that are used as examples and data points.
Changing needs & priorities
It is carnage out there. All attempts are focused on what can be done to stave off business failure. The consumer retail industry is searching for answers, and the data is throwing up some interesting insights. It is clear the consumer is also looking for something different. Their concerns about health and unemployment are adding to their frame of mind, their decision making. Consumers are responding to, and embracing retailers that use the next wave of automated contactless technology, are geared up for online and home delivery, shops who have make adjustments to their proposition, in an effort to meet the changing needs of families as consumers, those important assets who have control over ‘discretionary spend’.
What has happened to the consumer experience, the customer journey as a consequence of Covid?
What can be done to rebuild our communities?
What should be the response to changing consumer tastes and loyalties, considering the shift to online?
Now that Health and Wellbeing have entered the consumer mix, how should the retail sector respond ?
With 80% of consumers feeling more connected to their communities, it is clear the current retail proposition cannot meet demand?
What should shopping mall owner/operators, developers and towns and city administration and local government do next?
Covid — the accelerator…
The consumer retail industry was already experiencing difficulties. The arrival of Covid has merely accelerated the problems and compounded the issues of a complacent sector. A sector in need of fresh ideas, unable to respond to changing consumer expectations and had not invested in the primary technology enablers. A structurally disparate sector comprising different participants that had no intention of working together — landlords and operators, developers, retailers, brands and the supply chain elements — each focusing on their own version of customer experience or relying on someone else to deliver it.
In many ways the retail model mirrored manufacturing, assuming economies of scale could be gained from large, no huge retail spaces (malls and out of town shopping areas), huge centralised regional fulfilment centres was their answer. Vast expanses of glass and concrete that created soulless environments that offered little differentiation. Every mall, shopping centre felt the same and with few exceptions, where for many the experience was already poor.
Shoppers were already bored, real engagement was falling and online sales were increasing. The old model where landlords and mall operators relied on the big retail brands as cornerstone tenants, who they relied on to provide the innovation and invest in the actual point of purchase, the customer experience was actually getting worse, it was failing.
It is fair to say the ‘consumer retail operating model’ has been largely defined by the real estate developers model. The need to maximise space where all the owner had to do, was rent spaces to the big brands. Offering very little actual support other than a loading bays, toilets and a car park. They expected the large brands and retailers to bring their technology and innovation, to deliver the experience.
Covid has laid the retail industry bare exposing those businesses that didn’t invest in contactless commerce or an adaptable technology infrastructure. The core retail business model was already broken. The shift has already taken place. New levels of online volumes were achieved in weeks that would previously taken decades. There has been a 10 fold increase in demand for telemedicine and healthcare services. Disney achieved more new subscribers in 5 months that took Netflix 7 years. The shifts have been rapid and brutal, and now everyone is asking what do we do now to compete effectively?
Yes, Consumer Behaviour has changed…
There were several structural shifts and strageic plays set in motion prior to Covid — a rapid move to digital commerce, the rise of the ‘artisan economy’, growing number of local brands, the vegan movement, an awareness of carbon footprints of products and heightened awareness of food security and provenance.
Amazon’s has responded by moving downstream to acquire grocers and deploy technologies (Alexa) into homes that integrate with the shopping experience. Offering every kind of customer experience, choice and options for paying and delivery of their goods. Grocers have initiated a multiplying effect of smaller local community opening stores in smaller towns and petrol station forecourts have shown to be vital to support communities offering a life line and help, in the UK ‘home delivery’ seen as the fourth emergency service.
The rise of conscious shopping where families focus on essentials and their most basic needs, fuelled by concerns over job losses and economic uncertainty. Families rely on fewer visits to the shops, require retailers to deliver a safe environment and cater for their adjusted needs. There has been a rise in community first attitudes, where families look to buy local produce and a backlash towards brands and companies where it is perceived they haven’t done enough to help people.
Criticism and blame from the public is rising, as councils and municipalities have not responded well. Appearing to sit back and complain of lost tax income and empty public transport and car parks. Conveniently forgetting they gave planning permission that underpinned the retail sector, and in the UK they still impose costly parking fees, and allow litter to gather and vagrancy in boarded up shop doorways in towns and neighbourhoods that resemble a ‘zombie apocalypse’. They are not helping and the public are not happy.
There are of course regional and geographic differences between the US, UK/Europe, Middle East and Asia as consumer attitudes towards government decisions, rules and regulation vary due to ethnic, social norms and behaviours in each country. The data shows that despite these perceived differences, new trends have emerged that are likely to become new norms.
- The rise of community and local convenience/fulfilment
- Consumers shop consciously for price/value, for food safety, look for hygiene
- The changing retail mix — the demand for healthcare and wellbeing is both a requirement and an opportunity
The question everyone is asking — will the changes in Consumer Behaviour be permanent?
Changes in consumer behaviour is becoming ‘hard wired’, a combination of intermittent rules and regulations, the social curtesy of wearing masks and distancing, a more safety and health conscious decision to avoid confined spaces, large gatherings and hand washing.
When coupled with the closure of non essential public spaces during ‘lockdowns’ — bars and restaurants and public entertainment (cinemas), consumers have sought alternatives. People have adjusted, found new paths and adapted their lifestyles so that life can continue, working from home, the kids online education and above all keeping safe. The increased spend on essentials, a new focus on healthy alternatives, new expenditure on home entertainment and the rise of hobbies — cooking and gardening with a self sufficiency agenda and home fitness.
The question on everyones mind. When the Covid pandemic passes will consumers go back to old ways or will some of these newly acquired behaviours remain? It is worth reminding ourselves that certain ways of life remained after 911.
It is inevitable some people will quickly adjust to pre Covid ways although by then the retail landscape, our towns and cities will look entirely different. Large empty or half full shopping malls, empty main streets in towns that have lost their lustre, where large brands no longer want to be the cornerstone of the shopping experience. With many already replaced by smaller facilities that cater for a wider set of community needs, ‘pop up’ shops and local markets where anyone can sell their products and services. It is already starting to look very different.
New behaviours replace old habits and routines. New upcoming brands are replacing the old — think Peleton, LuLu Lemon. A smaller mall, a smaller shopping centre repurposed as a community hub, a safe place for families and friends to spend time (for entertainment), to find support and can get access to wider set of essential services — a pharmacy (drug collections), wellbeing, fitness, dentist and mental health support becomes part of the F&B, grocery and entertainment mix.
The Convergence of Online and Offline…
We have seen a significant shift towards online shopping and growth in services (telemedicine, healthcare and mental health support) as people remain cautious and sufferer from anxiety — feeling isolated, lack of family contact, coping feelings of desperation. The shift to online has happened quickly due to primary two factors — more options for Home Delivery or Click-n-Collect where shoppers can choose how they engage and, online helps cope with feelings of isolation, as consumers use digital commerce to learn, play and purchase what they need.
In the US, one of the world’s largest consumer markets, data shows the frequency of visits to the shops has fallen by 40% (despite during lockdown people a free to shop for food). Shoppers are combining their needs, planning much further ahead, ordering online and are prepared to seek local alternatives and brands. Consumers have become more price conscious, look for quality and food safety given against a backdrop of economic hardship and job losses.
- A consolidation of purchasing resulting in fewer more meaningful trips
- Conscious decisions to buy local produce from local suppliers (help local businesses)
- Buy Online and Collect in the safe environment of their car.
Changing consumer loyalty
Consumers are making conscious choices based on the economic reality, convenience and what is available. The shift to local brands is part of a sense that people feel safer and more connected in their communities. The data shows more people have joined support groups, check in on neighbours and are supportive of essential workers and those supporting the community.
As shoppers limit their geography there has been a resurgence in shopping locally where consumers report they prefer to support local businesses that are there for them all the time. Local businesses are seen as a lifeline and an extra support layer to those struggling.
The various surveys confirm more people getting more involved in local events, supporting schools and colleges, churches and community centres helping with fundraising and collections for the poor and needy. In some ways we are returning to older ways where community and good neighbours matter.
Capturing Discretionary Spend
The consumer battleground has always been the competition to secure discretionary spend, albeit in many households due to financial pressures and stricter planning, overall spend has declined as families prioritise differently focusing on essentials first.
How to influence ‘discretionary spend’?
The single most important strategy for the any retailer — how to gain control and influence over decisions relating to discretionary spend? Spend often held by mum for essentials, and then dad. Amazon and Walmart continually adjust strategies where online and offline meet, as they move downstream to engage more consumers in more meaningful experiences. Amazon has acquired local JC Penny real estate and turned them into local fulfulment centres. Recognising the need for fast and efficient execution and linking with local suppliers.
To objective: to offer a seamless experience where it doesn’t matter how the customer engages, order online, collect at physical stores, or home delivery and being able to drop off returns without entering the store. Customers expect a seamless journey that blends online and offline world, with new digital and immersive experiences, so they can decide how they prefer to interact with the product or service proposition.
Traditional strategies to reach consumers centre on price and value, brand and product positioning, increasing basket size and ‘own brand’ penetration that offer higher margins are strategies may have run their course. These approaches traditionally backed by TV and mass marketing techniques, store displays and promotions are already having less impact.
The question, considering the shift in consumer behaviours - how to gain the attention of families, mums and dads that make 95% of the purchasing decisions? Think Alexa, Wholefoods and Go linking to Amazon Prime membership offering new levels of incentives and rewards. The answer — to join everything up. Something the fragmented retail sector hasn’t done and why Amazon is so successful. Although not perfect, it does go that extra mile, literally.
The new strategies that will win the day are those retailers and brands that understand the need to stay connected with consumers, support them, entice them and reward them for every aspects of their engagement, and at every stage, not just for purchase. Retailers need to help find and deliver new sources of value to families, communities and retailers to support a post Covid retail world, a new consciousness has arrived where consumers, shoppers and family members plan their trips, arrange family events and go about their daily lives, have list of the essentials they need and consider their movements between home, schools, shops and days out.
- Consumers are conducting more planning and research online before making the purchase
- Consolidation of activities supporting each planned trip or journey
- Retailers that help consumers with extra help and information do better
- Many larger retailers and malls are closing their doors offering more opportunities for local suppliers to fill the gaps and meet demand
- Shift to home working — remote working (online meetings & Zoom)
- Reduction is airline and general travel, less use of public transport — a rise in local tourism — families looking at local holidays closer to home
- Focus on healthcare and hygiene — a rise in cleaning and health products — consumers develop a healthier conscience
- Rise in ePharmacy and telemedicine as people look for help, issuances and access to pills and treatments
- Rise of unemployment and slow down in growth in certain industries most impacted by Covid — while grocers, delivery, healthcare industries thrive, workers look to re-skill and take up the slack
- Customers less sticky — less brand loyal, prepared to try alternatives and products that come with a conscience and other benefits
- An awareness of the rise in mental health amongst all parts of the community, a desire to help and invest time and effort into local communities, places of worship, schools, clubs and support infrastructure (Volunteering)
- The volume of online purchases and transactions will continue as the world embraces contactless commerce, automation and robotics, and immersive experiences.
What comes next has to be different…
There is a public health crisis coupled with low levels in confidence, a consequence of people adjusting how they live and work, how they prioritise their lives, keep family members safe and make spending decisions. Consumers stor more essentials, not wanting to be left without when the next ‘lockdown’ is comes. People are looking for assurances from brands, shops and hospitality venues, their health and safety needs will be met. They seek solace in local suppliers, fewer trips and want to see a new mix of products and services available.
Retailers and especially malls have to deliver the things consumers value most, to refocus on the things that matter, in a way that feels right for families and communities. By doing so they will be rewarded with business, loyalty and frequent and regular visits. There is a growing urgency to ‘repurpose’ the mall and shopping centre as a ‘community hub’, something it was always intended to be, but never really delivered on the promise, as the landlord focused on short term profit ignoring the opportunity to build and create value for the community.
The entire concept of a retail presence, a shopping village, the mall, main street means something different now. It is not just a pace to spend money and buy brands, to buy lunch and groceries. Engaging the customer no longer means waiting for them to enter to store, or sign up online, for them to make the first move. New strategies are required that engage the consumer in their roles as parents, community members, captains for sports teams, local midwifes and teachers, priests and social club members.
How can the retail sector respond?
Consumers are demanding an entirely new experience and what remains of the decimated sector has to ‘rethink’, ‘repurpose’ and ‘reposition’ their offerings and propositions to meet the new consumer behaviours that have emerged, many of which will continue.
The large retailers and bigger brands have had a good run, with many already succumbing to being Amazoned and not shifting to online commerce quick enough. Some have run out of capital, the proposition of others was already doomed pre-Covid, using it as the ultimate excuse. Many failed to spot and adapt to new social trends — the impact of social media influencers, the power of fame and exposure to volume of ‘eyeballs’ improving to odds of someone actually buying to catch the consumer at the right moment. Are these strategies now also struggling?
In the US, Europe and Middle East there has been too much retail capacity, with endless new developments convincing themsleves the retail gravy-train will continue, as humanity seems obsessed with a consumption society they have created. There are simply too many malls, some linked to residential and commercial real estate presented as ‘lifestyle’ living. Others, a copy of what has come before, and consumers were already bored. The continual march of development programs keep adding more capacity in the belief consumerism will keep growing and tourism will deliver returns for real estate developers — ignoring key data as to why so many malls are simply going bust. After all they sell empty boxes, and there is nothing exciting about a box, unless it does something meaningful.
A major location with access to large demographics was seen as the essential retail component — offering easy access, parking and open spaces with good transport links. It is worth recalling what they teach you at retail marketing school — that its all about position, position, position. We can safely say its not!
This obsession with old strategies masked a general lack of investment in underlying technology infrastructure that could deliver a better customer experience. Developers and landlords passing the issue onto the brands and retailers to solve, rather than creating new income streams other than rent. Developers relied on a dominant local positions, where families see the mall and the retail village as an exciting day out, albeit these days feeling a little like ‘groundhog’ day. Seen one mall, you have seen them all, mostly.
In the Middle East a visit to the mall is a popular day out for the family and in this region consumer retail represents a large part of GDP. It is a barometer of economic prosperity and relies largely on tourism. In Dubai, famous for its super malls (The Dubai Mall) that have become tourist destinations to behold, that assumes one thing. The tourists keep coming. Across the UAE dozens of new malls are being built adding more of what appears to be the wrong kind of capacity. In Riyadh the ‘Kingdom Mall’ hasn’t changed its proposition in almost a decade and no longer feels special, and behind the facade of fish tanks, top end brands, how much actual tech innovation and infrastructure support exists? Indeed malls across the region feel similar to ones on the US and Europe operating on a common theme. Developers building it as big as possible to pack in the brands, that will apparently increase footfall. A strategy that is not able to respond to Covid, and was dying anyway.
The pandemic has exposed the fundamental flaws in what has been a generic ‘physical’ retail model, as on all sides has singularly failed to invest in flexible infrastructure that can support new contactless commerce and varying degrees of automation. Unable to move to online effectively and respond to the latest delivery and fulfilment options, that can deliver the convergence of offline (physical stories) with online that incorporates Click and Collect and autonomous home delivery.
- Smaller physical footprints as brands cut back and look for better value, and shift more effort online
- Smaller local shopping facilities with the purpose to become community hubs not just retail centres
- There are no limits or fixed ideas as to what products and services can be includes in the retail mix of internal theme park, water park, dentist, fitness gym, literally any service can be added
- Shorter supply chains delivering local products and services into the mix
- New businesses and proposition enter the retail (mall) mix — healthcare centres, dentists, pharmacy, fitness and wellbeing centres offer new opportunities
- Local produce with both a conscience and provenance — the rise of artisan quality and authentic food experiences
- Malls owners have to invest in new technology infrastructure because the brands will focus on online and advertising
- Re-mapping the layout of the mall and shopping village — a focus on health, hygiene, safety and incorporating new experiences immersive, hospitality, entertainment and live (community) events
- A concierge service that guides visitor to what they need and delivers a converged experience where consumers can order online while at the store and collect in real time
- The attraction (the draw) will probably be the live event, how hospitality is delivered and immersive experiences — not the brands on offer, the large car park and food halls.
Mall Developers, Brands and Technology
The implications for building and rolling out the next generation of shopping malls and experiences is profound. The temptation to acquire distressed assets at a low price isn’t enough, hoping the value of property will someday rise. One opportunity is to repurpose what is already there, converting other brownfield sites and locations into the things that deliver for locals.
There are lots of prime real estate that has recently closed their doors and owners looking for solutions, continuing to burn cash when the customers are not calling any more. Amazon is already repurposing JC Penny locations as local fulfilment hubs, a validation of structural change that is happening now. The watch word is ‘local’ — a closely associated word in this context to ‘community’, where small businesses and their supply chain serve local communities.
The belief that ‘big is beautiful’, that scale matters and the cornerstone of the developers business case is a leading brand that underwrite occupancy, is not an option any more. For decades now out of town superstores have wreaked havoc on small family retailers, attracting consumers to shop outside of their immediate community.
With fewer brands surviving those left do not want to commit to long leases, prefer smaller spaces and require the mall (big or small) to offer the right infrastructure. Infrastructure that can deliver contactless commerce, automation, immersive experiences Virtual Reality sales, promotions and entertainment, supporting 5G for Augmented Reality concierge and tours, Internet of Things drone delivery, and rewarding all consumers for participating and entering their environment.
Rethink, Repurpose, Reposition
The primary strategy for the time being will focus on:
Repurpose the physical retail experience alongside ‘offline’ — the ‘convergence strategy’. Choosing the right locations, the right premises in the right areas to repurpose for community centred needs, products and services.
Reposition the consumer retail proposition as a community centric hub that delivers essential products, services and support, that draws the community together for a higher purpose.
Rethink the consumer experience focusing on the changing consumer behaviours, the mix of what is on offer — essentials versus entertainment versus support, versus feeling safe and secure versus health and wellbeing.
Repurposing involves investing in the technology enabling infrastructure that attract the best tenants and brands who want to deliver new experiences and where contactless commerce is seen as a given, the essential baseline and not a differentiator. Key brands that are doing well despite the pandemic are attracted to locations that can enable the convergence of online and offline, with eSports, gaming and ‘live entertainment’. Smart locations have embraced new old entertainment — ‘drive in movies’ are once again popular for no other reason customers can control their environment or thier terms.
Only by adding new infrastructure to a large or small mall, shopping centre or main street that can support what comes next e.g., LuLu Lemon virtual stores, Peleton virtual workouts, Twitch competitions, eSports events and automated inventory fulfilment, drone delivery, Click and Collect and ‘easy returns’.
We will see anew breed of landlords acquiring prime retail assets who understand one cannot rely on ‘rent’ or affiliate income as the primary sources of income. As mall owners now realise their primary income stream has dried up. The value of the underlying asset has plummeted. There is no bail out. They now wish they had invested in multiple income streams by offering services literally ‘outside the box’.
Measurement — what is success?
Part of the problem has been the measurement of success. The obsession in a physical store with revenue per square foot, footfall, the focus on increasing average spend per basket, will soon be replaced. To compete in a post Covid retail world, single product businesses and those peddling disjointed services will not be able to compete effectively.
A new generation of malls and shops rebranded as local community centres will emerge, seen as the family, the local community preferred destination, to shop, meet friends, get help and support, eat some food, see a movie, go ice-skating, play games, drop into the gym or have a massage, or even to go clubbing, get some needed treatment or pick up that prescription.
Non delivery of the dream
After all shopping malls were meant to replace community centres, as they dragged locals away from their towns to larger centralised facilities. But they sort of missed the point, behaving more like big businesses rather than investing in local communities. So we have come full circle as communities are turning their back on what is on offer, they have no choice as lockdowns have forced the local issue, as people find alternatives closer to home.
Repurposing requires the introduction of automation technology and resilient operations that can function at all times and support any retail experience the tenant whats to deliver (physical, online, virtual, augmented, or real time 3D photo realistic products) who wants to offer drone or self driving van delivery, allow customers to collect and have bags loaded into their cars.
What is the purpose of a mall, a shopping centre or main street?
People have realised malls and shops are part of the fabric of local communities, whilst they are far from perfect, in many cases replacing local businesses with out-of-town superstores. Realising when they are not there life is certainly harder, there are fewer jobs and people have to travel further to buy essentials. When communities are hit by economic hardship, they suffer, crime and uncertainty increases, standards drop and people feel lost. When they feel lost communities die.
Consumers want an environment to feel safe and one that can accommodate any and every type of consumer choice — for purchasing, returns, delivery, eating and drinking, for entertainment and to keep the family engaged. A meeting place, a business and entertainment hub, a place to heal oneself and get treatment, a place to live in adjacent sustainable accommodation, or a place to experience live events and immersive experiences, for education and study, for friendship and social engagement to avoid feelings of isolation.
It is worth remembering consumer retail locations (malls and shopping centres) create many local jobs, they pay their taxes which goes back into the community through local services. The concept of the ‘mall’, the ‘shopping centre’. ‘main street’ without Repurposing, Rethinking and Repositioning is doomed.
The future of our communities may well depend on how we ‘repurpose’ consumer retail facilities to benefit everyone, whilst creating an economic model that delivers returns for all stakeholders, not simply measured in footfall, average spend but also meeting the needs of local people.
There are no rules and no limits to the uses and things that can offer as part of the mix. Human needs are wide, their discretionary spend is available and they are starting to reject what is being offered right now.
Further Thoughts, Conclusions, a Call to Action
Changing consumer behaviours was already having a deep impact on the retail sector prior to Covid, a partial response to being Amazon-ed, the redefinition of tired propositions, the impact of new technologies that deliver immersive experiences — AR and VR offering game engine design with in game and virtual purchases and ability to design your own products e.g. Nike shoes. The effect of Covid has accelerated change a 100x.
Recent trends — the rise of influencers, famous people as brands themselves with more followers that most household names. The consumer retail market expanded to include product, service, experience that could be purchased at any time, anywhere — the convergence of online and offline, now intertwined with virtual worlds.
What’s in the mix is anything and everything
Consumer retail is a world that now includes everything — garments and apparel, foods and beverage, other goods (electronics) and services (car repair), entertainment and gaming, live events and sports and fitness, wellbeing and healthcare, education, virtualised stores, local pop-up markets and artisan street food, visiting artists and entertainers, the list and what we can expect to be included are part of the retail experience is anything and everthing a community needs.
Consumer retail requires a new wrapper, to be offered in many shapes and sizes, not just large malls and shopping centres, and physical locations must sit on an enabling transformational technology infrastructure that works longside online services, supports physical services that deliver help, rewards and value, that can unlock the full potential of all the propositions at once.
The maturity of automation and robotic processing removing then human element for efficiency, accuracy and speed, the use of Artificial Intelligence to second guess and predict ‘needs’ and ‘wants’ of consumers, where one could ask — is Amazon a retailer or an AI company? Or both? Is Ocado, now one of the worlds most valuable grocers, a delivery and fulfilment company or technology business or all three?
The arrival of 5G and soon 6G that improves network connectivity deliver instantaneous messaging, signals and communications allowing autonomous vehicles and interconnects devices such as drones that can re-charge inflight and deliver to your door, balcony or office. These technologies are not new, they are maturing and the cost is falling.
Consumer retail cannot be allowed to fail as the consequences on local communities are too great. Consumer retail needs to be redefined in terms of post Covid impacts, behaviours and as a means to rebuild communities. Smart money understands the social responsibility, they also know that when you win the hearts and minds of local people you will get their loyalty, you will earn their support and you will get their discretionary spend.
The opportunity for transparency and fairness, to create new commerce that rewards involvement and participation as well as spend, sitting on distributed ledger technologies that supports an open and fair ways of creating commerce digitally and conveniently.
What does good look and fell like?
Yes we love the glitz and vast selection of brands and foods on offer, but do we really, or is it all too much, overwhelming? Have we been told to like this, to walk around large boxes with artificial lighting and dirty air?
We may confuse easy parking and long walkways spread on several floors with convenience, or do we really find it exhausting and too much because its hard get around to see everything in a single day. Do we find the endless shops, same brands in the food courts all too familiar and yes boring. Yes we have cinemas, some have pop up shops, the odd mall with an ice rink or bowling alley, but it feels too familiar, somewhat tired and predictable, and lacks soul, cannot deliver for communities and families who needs and requirements are more specific. To keep us safe, look after us, entertain us, deliver good value and yes we will return time and again. Above all deliver the things we need today or we will find alternatives, move away or get our kicks and shop entirely online, as community crumbles.
Consumer behaviours have shifted. Communities are failing. The centres of towns, the heart and soul is dying. Retailers, landlords, developers and owner operators, and local government, banks and authorities have some choices to make. Either adapt and start investing in communities or go out of business, ending up with ‘zombied towns’ where people are alive but not living.
© Nick Ayton 2020
About the author.
Nick Ayton is a futurist and has worked in technology for over 40 years. A pioneer of business processs transformation in the 1990’s he works with founders and boards to help transform and valiudate business models and propositions. He has created a number of disruptive business models in financial services, airlines and transportation and in entertainment. He works closely with Family Offices and serves as board member at Mythic Studios a leading 3D animation studio and LifeSimple a business that has engineered an entirely new consumer retail approach which prompted his research and observations in this document.
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