According to international retail futurist Howard Saunders, the effects of the 2008 GFC which remade the retail business landscape are still being felt by retailers, especially large international corporates that have not been able to respond quickly to the priorities of a “rebooted” consumer.
Saunders was in Australia as part of the annual Westfield Retail World Survey, and spoke to students and industry professionals at the Sydney Institute of TAFE's Ultimo campus last week.
In his presentation, Saunders introduced a new acronym for the retail shoppers of 2015, a cohort he's dubbed Post Apocalypse Man (PAM) – or Woman, as the case may be. PAMs approach the process of purchasing goods and services with a different outlook – one that frames the task as a quest for the perfect solution and one that privileges a “hero mentality”.
“There has been a revolution in retail,” Saunders said.
“Before 2008 we were buying stuff we didn't need and using credit to do it. And then came the crash. I call it the apocalypse because it changed everything – I fundamentally believe that.”
“Trends and change happens in us – we start to see the world in a different way,” he said.
“My evidence would be the way we view brands like McDonalds, Burger King and Starbucks – the view these days is that there's too much stuff, too much waste and why does everything have to be so big? These brands know they're in trouble – they're still selling billions of items but they know the gourmet brands are taking over that that consumer perception has shifted. This change has happened in a few years.
“In the UK, there was a statistic that said one in every seven pounds spent nationwide went through Tescos tills. This supermarket became a mega-market selling food and electronics, fashion, bikes and car insurance and optical glasses and they took over. Now they're in deep trouble, stores are closing or becoming much smaller and are drilling down their focus.”
An interesting statistic Saunders cited is the exponential growth of the gourmet or Farmer's Markets in the US. Before 2008 there were 10,000 farmer's markets in regular operation, now there are 25,000.
“It's incredible to think that at the worst possible time in US retail history, these markets have more than doubled,” he says.
“And now online brands like Ebay and Amazon are wanting to turning to the high street, leasing retail space. Interesting brands want to be part of what the high street has to offer.”
“In the wake of watching banks collapse, governments overturned and general chaos reign, a new hero mindset has arisen. So now that things are OK and we've all come through it, we want the best now, not 'a' product, but 'the' product. And the search for 'the' product is not limited to a particular category, it influences the way we view everything from a cup of coffee to t-shirts, to high-end luxury items. We want different things from our brands now; the new PAM customer mindset is a consumer who, like the pioneer, like the pilgrim, is searching for the authentic answer to their needs that combines form, function and a handmade, bespoke aesthetic.
Saunders' findings suggest the new consumer mindset is bound by five broad rules:
- PAM wants to know what the product's provenance is; consumers are now looking for the 'right' product with the 'right' values.
- PAM thinks it's all about me; the new 'me-centric' culture means that products will be either bespoke or offer customisation.
- PAM thinks I only trust experts now; the customers are seeking specialists in their fields, companies whose products are formed from an extensive knowledge of a particular niche and are able to express that through their marketing and branding.
- PAM says talk to me: retailers and brands must have something to say, not merely something to sell. Retailers have got to open a dialogue and communicate with the people that shop there.
- PAM says nothing need be ordinary (NBBO); customers expect more from animated signage to dedicated retail pop-up spaces that by their very nature are changing and evolving. These customers don't respond well to conventional retail space, challenge them, excite them, offer them an experience they can't get anywhere else.