The End (and the Beginning) of Everything
The Amazing Evolution of the Retail World
Estimated Read Time: 4 Minutes
After a long talk about how we were going to handle the post-COVID work environment in our Columbus HQ, it dawned on us that office culture, cooler talk, cubicles, conference rooms, Dilbert jokes, corner offices, offices period… were either over or had completely changed. All of it. Kicked to the side of the laser beam highway that's blazing through this frantic century, just like phones with cords, newspapers, and cooking dinner. Offices got sent into the vernacular of the "can you believe we used to…" world. In other words, offices, as we once knew them (like two years ago), are toast. Or at the very least, a totally new kind of toast. Stunning.
But wait, it also occurred to us that offices weren't the only thing that's changing so rapidly that our grand kids will laugh when we tell stories of the good old days. How about cars (vs EV's)? Shopping centers (vs e-com)? Movie Theaters (vs streaming)? Fast Fashion (vs re-sale)? Dine-in (vs delivery)? Cabs (vs Uber)? Business Travel (vs Zoom calls)? Advertising (vs influencers)? Boomers (vs Z)? All those changes before we even start to think about what's happening to baseball umpires (v robots)!! Yes, it's the end of just about everything. 1995 seems like 150 years ago.
If you thought about it for a while, you might have a panic attack. So don't. But do think about this; we've also adapted quickly to the beginning of all the aforementioned new everything. Humans are moving on without even trying. But not quite everything is in that stew. From what we're seeing in our research, humans still love stores. At least some of them, some of the time, and in some of the places. So, not so fast, “New World”, let's not throw stores under the self-driving bus just yet.
In a recent WD study utilizing the thoughts of over 2700 fellow Americans that match national demographics, we discovered that when given a 'select one' choice (of 12) as to what kind of a physical store they would go to when they're not shopping on-line (FWIW, respondents said they'd be shopping 64% of the time on line go-forward), 37% of them chose "local brand, local store". Light in the tunnel, indeed. Also, when given a multiple choice ranking (1-7, 7 being high), "local-local" got an excellent 54% top 2 box (6's & 7's only) score. So a slow down sign to the e-com completely taking over mentality for sure. At least not if having local space (think: the customer's at home now) has anything to do with it.
We saw another sign that our love affair with stores isn't completely over when we asked those same 2700 people how they'd like it if a “big brand / local (smaller) store” came into their neighborhoods. We got back a terrific 50% top 2 box score on that question as well. That's big news, especially for the leaders of retail Real Estate development. Thanks to the genie being out of the bottle on working from home, the idea of actually opening some new (albeit smaller) stores is not so crazy sounding anymore. Combine that thought with the popularity of 'showroom stores' (58% top 2 in another WD study) and you've got less build out, less leasing cost, less labor and a fantastic billboard that a customer could and would want to walk to.
Moral of the story is this; sure, it's the end of many things we once thought of as permanent, but it's also, if you look between the cracks, the beginning of what could be a ground breaking new / old frontier for the beleaguered idea of a physical store. From what consumers are telling us they want, (IE: the job of a retailer) brands of all stripes should consider the following in their upcoming real estate, development, and design strategy meetings:
- GET LOCAL: be where your customer is now
- THINK PORTFOLIO: not only type, but location
Re: that second bullet… the New World has told us another thing; there is no singular store model or solo primo location anymore—there are many. Winners will be those brave enough to embrace a design, operations and location strategy that's multi-faceted, flexible, adaptable, and creative. There is no longer a set-in-stone, singular model to scale a brand. There is no 'prime' location (think 80's / malls), and no exemplary model that will work everywhere. There are many. That means, in order for a physical fleet to succeed, accepting the fact that you need a customer-focused portfolio of options at the ready is paramount, including the following:
- A new look at what 'local' means.
- Spaces with exciting and different experiences that include pick up and delivery.
- Fast-fill commerce spaces that are pick up and delivery only.
- Fresh locations, local and otherwise, that are destinations built around the customer's needs, contextual value and your own set of influencers.
- And of course, room for commerce spaces you haven't even dreamed of yet.
The delta between where we are now and the New World of customer-based physical spaces is not as wide as you may think. Target, Nordstrom, Express and others (Urban Brands has always been local) have devoted their powers to similar strategies and the results are in their quarterly reports. The time to act is now… because everything just ended… and that makes this the best time ever to begin anew.
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