Where and how do people shop in the future?
The future of retail is not about shopping
Creating experiences and rethinking urban development
When talking about the future trends in retail, we often use the term "digitalization". Admittedly, digitalization will in the future redefine the rules of the retail trade. That is as sure as night follows day. Trend researchers, experts and customers are aware of this fact, but the extent to which these rules will change is still beyond anything that we can imagine. But buyers will not adopt and use everything that is technically feasible. The retail trade is changing and being conducted online to an increasing extent. And it will have to maintain its presence online in the future – only in a different way and by thinking things forward.
Today, brick-and-mortar stores are increasingly disappearing and being replaced by online retailing, especially in smaller cities and rural areas. This has had a huge impact on shops specializing in textiles, leather goods, books or ceramics in particular. Only the food trade has been spared so far. It is worth noting that small retailers often play an important role in the urban landscape. Large shopping centers are also coming under pressure. Customers are increasingly staying away, preferring to make their purchases online. The stationary retail market will not however disappear, despite e-commerce, but it must continue to evolve:
- Purchasing processes have to be geared to the needs of the customers. Focus today is being placed on concepts that make shopping an experience, therefore attracting people to the cities. Stores need to be places that customers enjoy visiting, where they can spend time, meet their friends, and purchase products and services then and there. Fashion shows in boutiques, wine tastings in delicatessens, fitness classes in sporting goods stores, outstanding restaurants in the immediate vicinity – there are no limits to the imagination when it comes to creating an unforgettable shopping experience.
- The classic customer journey is becoming increasingly rare. For many brick-and-mortar retailers, the future therefore lies in combining online and offline offerings. The stationary retail market could focus on making it possible to try out products and put them to the test, while orders are placed and purchases made online. Brick-and-mortar retailers cannot however avoid investing in new technologies if they want to survive in the marketplace.
- Well-trained, qualified personnel are vital to the stationary retail market if it is to offer an unforgettable shopping experience. A high level of service quality offers added value and benefits to customers, something they are not offered when sitting alone in front of their laptop.
- New business models need to be developed. The brick-and-mortar retail trade can compensate for the weaknesses of online retailing. Individual retailers could eliminate problems relating to unpredictable delivery times and time-consuming returns, for example by accepting and returning customers' packages around the clock.
As a project developer, we naturally give considerable thought to how a property can be made attractive to customers so that it contributes to the "new" shopping experience. Utilization concepts need to be rethought: If customers are no longer going to brick-and-mortar stores, the stores need to come to the customers. The vision here is a vibrant mixed-use urban development with high-quality architecture and an attractive mix of uses for future-oriented shopping, living and working.
After all, a property only works if the utilization concept is well received, attracting both tenants and visitors over the long term.
Konstantin von Abercron