Tim Radley speaking at the PLUGin event –
“Welcome to the Global Shopping Mall – future of E-commerce and Retail”
31st October 2018: 6-30 to 8-30 pm
Central Working Victoria, 25 Eccleston Place, London. SW1W 9NF
For more information and to book:
https://www.eventbrite.com/e/plugin-welcome-to-the-global-shopping-mall-future-of-e-commerce-and-retail-tickets-51031747330?aff=ebdshpsearchautocomplete
Those, with a longer retail tooth, will remember an extreme retail concept from the 1990s called Incredible Universe. At 17,000 sqm it was a retail heavyweight, selling everything electrical and technological, such as it was back then.
The ultimate “Category Killer.” It was killed off by its operational scale and, even before the internet, by its over-ambitious expectations of physical retail. Within a decade it had disappeared.
It marked a turning point with a legacy for today’s retail world. Whilst its name inadvertently prophesized the future of retail; the failure of the format revealed the limitations of physical stores to attract and demand the patronage of the customer. Physical scale no longer meant irresistible destination.
Roll forwards to today’s world. What are our retail destinations, our future centres of shopping? Where is the global shopping mall?”
The expression “shopping centre” itself is becoming obsolete.
Retail is less focused and more dispersed. Not so much shopping centres but indeed an incredible universe. The customer has a digital and physical retail world at their feet, and their finger-tips. They are in control. They will define where, when and how they shop.
The centre of shopping is now the customer. More specifically the mobile, as an extension of the customer’s personality and physical location, it is the heart of this new shopping centricity.
This doesn’t mean that mobile will be the only way to shop. Its role is equally to educate, to guide, to connect and socialise with a variety of digital and physical shopping experiences.
Mobile simply puts the individual at the centre of their personal incredible universe.
Let’s look at some aspects of their new world…
Selling generic product in a physical context is dead. Amazon, Zalando and online competitors with their convenience and choice have already taken the market. Witness the demise of Toys & Us, Comet, HMV and many others.
The numbing purchase of necessities, the tedious trudge for lowest price is being alleviated, rationalised and owned by digital.
The weapons for online customer patronage are convenience, ease-of-shop, segmentation, personalisation, delivery, returns, logistics, loyalty rewards.
The digital battle plan is to develop into lifestyle support brands where retail is just one element. Amazon is not killing retail. It is a remarkable retailer. It sells service, entertainment, support, product and lifestyle, as well as convenience and price. 100 million people pay over 10 billion dollars to Amazon Prime for the privilege to spend money.
Digital retail is less about product, and less about choice.
The digital world will increasingly define choice not offer it. Successful operators will develop trust with customers through appropriate edits and choices of products. Alexa and others will suggest purchases as needs and desires emerge, and like-minded influencers with the trust of their followers will inspire impulse.
Digital customers are in fact “buying time!” Time to spend on other parts of their busy lives – namely entertainment, experiences and social interaction. And yes…their physical lives including physical shopping.
What about physical retail?
As the Ying to the Yang of digital convenience, physical retail is about experience and entertainment. Even digitally nurtured Generation Z’s are discovering, for the first time, the fun and social interaction of physical shopping as part of their daily lives.
Physical retail is recognising and reacting to this new reality. Shopping Centres can no longer just be places to buy. All shopping is becoming a by-product of living, and that must be a combination of fun, education, entertainment, well-being, leisure, creativity and sustainability.
Recent analysis from the new Westfield Centre in Oxford shows that over 50{9a7291a7292e83c5148384adada0c82317c2655f4bcb859b5345564a4c272287} of customer visit in the evenings for the mixture of leisure and entertainment with retail. Physical shopping centres as such will evolve into these even bigger and better “lifestyle” destinations. Witness the new Westfield in Shepherd’s Bush, now the largest shopping centre in Europe, with its wide variety of entertainments including innovative hybrid restaurant concepts combining eating with bowls and golf.
New centres and old will need to create a connection with the community.
The need for community belonging and interaction is a powerful trend. A return to historical social needs. The retail exclusive high street and town centre is regressing back to a place where housing, retail, cafés, gyms, leisure, cultural and local support services provide people with their lifestyle needs.
Lifestyle communities will continue to attract people to live and to shop.
Within this model the retailer opportunity is to become a “local destination’” Retail business will continue to evolve from the passions and activities of individuals where products and retail opportunities emerge as a commercial extension. Multiples and chains will increase events and experiences in their business models. There will be a higher priority in established and new businesses for customer service and visual display and a true engagement with the community around their shop locations. These will be the essentials for survival and success.
Retail businesses will become retailer communities in themselves formed of retail personnel at every level, suppliers, collaborators, customers, influences, local business groups and community enterprises.
Retail will become part of life. Not a means to its own end.
People will continue to turn their back on mass consumerism, demanding added-value and emotional connection with the businesses and people they buy from.
So, while no one can be sure in such an uncertain world, in such an unpredictable industry. The future of the shopping mall may look something like this.
The centre of shopping is the customer.
Mobile retailers will be ever-present but must be more than just sellers of product and must continually be seen brightly by the customer in the universe of alternative solutions.
Physical retail must literally move with the customer. Only the most attractive and exhilarating retail experiences will entice the customer to travel to them. Stores will open in appropriate lifestyle locations, combined with food and experiences, where the customer comes to live and enjoy.
Permanent store portfolios will be supplemented with dynamic & flexible pop-up concepts that predict lifestyle patterns, anticipate buying trends and selling locations, and which respond to constantly changing patterns of movement.
Above all, successful retailers will shake free of their origins from an operational perspective and from a customer brand perspective. We will no longer segment retailers as physical, pureplay, digitally lead, or omnichannel. We will no longer draw a line between shopping centres, department stores, mass merchandisers or communities of independent retailers.
Retailers will simply be successful – inspiring, educating, supporting, facilitating and engaging a community whenever, wherever and however is appropriate.
One thing is unequivocal…the customer is in control.
If you want them to be your customer, you need to go with them and be with them every physical and digital step of the way.
Are you understanding the lives of your customers?
Do you still treat their custom as a right and not as a privilege?
We’d love to hear your experiences?
Sleep on it and let us know in the morning…
tim.radley@vm-unleashed.com
0044 79676 609849