Geronto-tech: shock for mall and high streetPosted: February 28, 2011
Every couple of weeks, or so it seems, we get to read a new iteration of the same research. What this research tells us is that – shock horror – the “older generation” is not only comfortable with “new technology” (sorry for all the quotes marks), but has welcomed it to hearth and home.
Yes, it’s the over-40s/50s/60s that are buying the Kindles, shopping voraciously online and playing Angry Birds. Who would have thought that the wrinklies, brought up in a world of hansom cabs and gaslight, could have figured out where the On switch is, just like that?
Of course, anyone aged under about 75 had plenty of exposure to PCs in the workplace, and has been living with the internet, digital cameras and novelty phones for the past 10 years and more. Old dogs are very happy to learn new tricks when there is a palpable benefit available to them. Indeed, the old dogs have proved remarkably adept at figuring out which functions to ignore on a PC or a TV handset (ie most of them), and how to exploit technology to do straightforward and useful work. Some applications – eg Twitter – have built their success on the middle-aged, rather than the young.
What all this flim-flam tells us is that, in the real world, the older generation has adapted very readily to technology. I’m interested in their predilection for shopping online, and for downloading content. The hardcore of early adopters to new technology and new concepts may be young, but the next wave will be older and wealthier – people who have been around the block a couple of times, and are prepared to pay good money to make life a little easier and a little more interesting. They’ve learnt the value of shopping around, so they are avid users of price comparison websites; and they’ve got a pretty clear idea about what they enjoy doing, and what leaves them cold.
And increasingly, the business of “going to the shops” is at the frigid end of the scale. Not just mechanical, repetitive shopping for groceries, that they’re happy to outsource to Tesco or Ocado, perhaps adding a twist of unpredictability with Abel and Cole. No, more and more consumers reach a point in their life when they know what they like, and they know how to use technology to get it, at the best price.
For teens and early 20s, shopping is a social experience. Hanging out in New Look or the Apple Retail Store is fun when you’re young. Ten years later, dragging yourself and family around Debenhams or Currys is precisely the opposite.
Those in their middle years – which for the sake of this argument we’ll extend from the mid-30s right through to the early 70s – are time poor. Some of them are still cash rich, in the old noughties equation, but the proportion that feels comfortable is falling. They want value, and they want efficiency. Online shopping for goods and services provides this, and the physical stores struggle to compete. For many customers in our broad, middle-aged bracket, the high street is toast. It’s for the birds. It’s history. And if you want to buy this stuff – well, what’s the name telling you?
I think that we are a very long way from seeing this shift from physical store to online shopping flattening out. Online retailers understand what their customers want – they have infinite data to enable them to continually update their offer to maximise the benefit of clicks on different products and categories. The manager of a physical store has to stand and watch the displays to see what is grabbing the customers’ attention; the online retailer not only knows, but is constantly tailoring the offer for their market, and for that individual customer.
Of course, consumers still enjoy using stores that give them extra, intangible value. John Lewis genuinely trains its partners in product knowledge and customer service, rather than paying lip-service to these concepts. Sales may have dipped at JLP in the past few weeks – the partnership publishes sales data every week, which the City uses as a bellwether for the high street. I would posit that JLP’s public cold will be others’ private pneumonia.
Given the drift away from shops by the over-35s, what is the future for retail real estate, whether in regional shopping centres or old high streets? I commented a couple of weeks ago, when I was being rude about Camberley, on the impact of major malls across the UK, whereby the number of locations required for national coverage is falling. I suspect that this trend will continue, and that the future for shopping will be split between the major destination (Westfield; Kingston; Reading) and the genuinely local high street.
Those that fall between two stools – clone town offers with a choice between poor public transport or expensive parking; towns where shopping, working, recreation and residential zones have been scrupulously separated by planners; centres where the amenities that encourage community are absent – are going to suffer significantly. We need to think seriously about the future of our town centres; and individual retailers must plan for the online trend to continue to erode their physical store sales, recession or not, for the foreseeable future.