Without any doubt, the most widely asked question, or variation thereof to all the presenters we saw on the Westfield World Retail Study Tour was â€˜How do you see e-commerce impacting on your business/the industry?â€
The answers were fairly narrow in their responses too and â€œItâ€™s going to be hugeâ€, â€œWe expect quite a big impactâ€, â€œWe see it as a very important growth channelâ€ and â€œItâ€™s a great opportunityâ€ would probably sum most of them up.
One of the most interesting facts to come out of all of the e-commerce conversations was that most experts agree that e-commerce sales will probably peak at around 20% of all non-food retail spending by 2020. (Which may go some way to explaining why none of the responses were â€œWe are absolutely terrifiedâ€)
Hold on! Only 20% you say? Judging by some of the doom and gloom media reports we see almost every day, isnâ€™t the rise of e-commerce meant to mean Armageddon for traditional retail? Even if they get it wrong and its 30%, that would still seem a lot less than most would expect given the bad press. And this in light of another statistic shared with us that 89% of Australian consumers still prefer to shop in store rather than online.
E-commerce as a complete retail killer? It would seem not. Itâ€™ll probably take a nice chunk but wonâ€™t kill it.
What it does seem to be shaping as the complete killer of though is bad retail. Boring, uncreative, non-stimulating retail that relies on nothing more than old, tired store formats, sale signs and discounts to get people through the door. Because as we all know, if there is one thing e-commerce is good at, it is sales and discounts.
Shopping at its core should be an emotional function not a logical, transactional one that leaves you with the feeling of just having made a bank withdrawal. And the good retailers we saw on the tour are getting back to just that, getting customers through the doors using a variety and mixture of creative and innovative methods from store design and layout, VM, theatre and interactivity. In all such stores, in all of the cities we visited, there was almost always a decent crowd of people, engaging with the store and its product and most importantly, spending money.
There were a number of examples of this but my personal favorites were watching potato crisps being prepared from scratch in a mall in Tokyo, being able to tap your own mustard into an authentic ceramic jar in Paris, Collette, the curated product store in the same city and buying a personally embroidered peak cap in New York, all of which cost a premium to buy from.
But the cost seemed to be the last thing on the minds of the people in those stores, which is surely the ultimate sign of whether a retailer is getting it right or not and a real motivator to get struggling retailers thinking outside of their current box?
As always I would love to hear your thoughts on this or previous posts from the tour in the comments section below or feel free to e-mail me on email@example.com