2016 – A brick wall ahead for bricks and mortar retail?

2016 – A brick wall ahead for bricks and mortar retail?

2016 – A brick wall ahead for bricks and mortar retail?A New Year! 2015 was an ‘annus horribilis’ for many bricks and mortar retailers, large and small. What might 2016 hold for them? It appears Landor, the branding and design company, think that 2016 will see a resurgence in brick and mortar retail. But before you go off and buy shares in Tesco and Wal-Mart, let’s pause for thought. As I see it, while shopping has changed massively in the past few years, retail is, in many ways, still stuck in the 20th century, and bricks and mortar retail will face another tough year in 2016.

2015 was the year when retail started to see some real change. After five years or more of rumblings, of models creaking, things really started to change last year. Tesco’s fall from grace in 2014 had already shown that there were fundamental problems with the 20th Century retail model they still followed. Last year continued those trends. became a model that more and more shoppers took up. Still more discovered that discounters were more than low prices, and actually offered reasonable quality and a fair deal. More and more shopping moved online. More and more shopping went mobile. But it wasn’t all one way traffic onto devices – Amazon also launched an offline store. Independent stores in some sectors grew for the first time in many years. Shopping changed as shoppers were liberated – with more and more places to buy, they chose to eschew the ‘one-stop-shop’ model of the last century and move into a new, fragmented shopping mode.

Has bricks and mortar retail seen the light?

With shopping behavior changing so much, a casual observer would assume that the way brands and retailers market to shoppers would change dramatically too. But, a trip to a store (either online or offline) suggests that this hasn’t been the case. In a typical superstore, a shopper is still greeted with floor displays stacked with discounted products, deals and discount codes. Discounts, discounts, discounts.

Shoppers are enjoying the fragmented shop

And so for two reasons, I’m afraid Landor are going to be disappointed. Firstly, there is little evidence that shoppers will “will return en masse to the old-fashioned way of shopping”. While there is evidence that Generation Z shoppers have more affinity for bricks and mortar retail than millennials, I rather think that shoppers are enjoying the liberation of this new way of shopping. And while shopping habits will continue to morph and change, it is unlikely that we will see a mass return to bricks and mortar retail.

Bricks and Mortar retail has a mountain to climb (with its hands tied behind its back!)

Secondly, bricks and mortar retail will change, but it won’t be overnight.  Bricks and mortar retail will inevitably wake up to the fact that they need to step up and deliver a better experience, but the sheer cost of transforming entire store portfolios alone would kill most businesses. And this comes at a time when there are more demands than ever on the average retailer. Recognizing the need to win online as well as offline, bricks and mortar retail is having to fund online operations which for many are still not profitable. Many find themselves embroiled in expensive price wars. Fighting one of these battles would be tough, but trying to win on three fronts will take time and a lot of cash.

This decade still seems to be the most exciting time to be working in shopper marketing or in retail. It might be a rollercoaster ride for some, but it will be a thrill and a fabulous learning experience for those who rise to the challenge. If you’re involved in brands, marketing or retail, please subscribe to my blog to join me on the journey through 2016 and beyond and to pick up helpful tips on how to navigate the turmoil and come out triumphant!

 

Image: Wikipedia

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