Retailing had a good long run. It was fun while it lasted. But it’s over.
A world where few purchases are made at physical stores?
Think about it…
-Consumers learn about products in great detail from manufacturer or etailer sites, with ratings, cautions, and opinions at increasingly wiki-like mass-input product info sites.
-The declining world economy (a long-term situation economists now call “the new normal”) is diminishing the scale of retailing. For cost efficiency, there are fewer SKUs – soon we’ll have to make do with 30 styles of red stilettos rather than 300.
-Conspicuous consumption has become uncivil, our new lifestyle is “blending in” rather than “keeping up with the Joneses”. To quote a line from a previous LabNotes: In this new pattern of social behavior, profligacy has become…thinking hard here…what’s a word that combines “dumb” and “impolite”?
-Delivery systems like USPS, UPS, and FedEx have become more efficient as they’ve scaled up to meet home-delivery demand.
-Daily food no longer requires bought and stockpiled ingredients…these days it’s take-out, delivery, or eat at chain feed troughs.
-Complex, fast-evolving electronic products are far better suited to internet sales than retailing. (Other than the Apple Store, part of a uniquely closed products and services ecosystem, mall electronics stores are fading away.)
-Mobile phones that transact with vending machines will cause those machines to proliferate. Because every consumer will have a mobile phone, they’ll buy picture hooks, pantyhose and pajamas from a nearby machine.
-As retail margins and sales volumes have waned, corporate managers have been cutting costs: dimmer lighting, fewer window cleanings and tightening the wage and benefit screws on store employees. So the register clerk you’ve waited longer to come face to face with is more likely to be the type of passively hostile, minimum-wage “sales associate” you’ll buy your next shoes at Zappos.com to avoid.
Now for the good part (for us brand pros anyway). On the internet, your brand is the universal icon of what you are and what you sell. Without the distraction of adjacent shelves of similar stuff, that icon is pure and potent on its web page.
Never has branding – especially the “good behavior” that underpins online brand value – been more important.