A few weeks ago, during a brief visit with family in the Pacific Northwest, my brother-in-law showed me a fascinating 1937 Sears, Roebuck and Co. catalogue he had purchased at a benefit.
According to a new study of the near term changes in retailing produced by IBM and the NYU Stern School of Business, Sears, along with Montgomery Ward and J.C. Penny, used books such as these in the early 1900s to create modern retailing.
Fragmentation in retailing began in 1975 and by the year 2000, consumers took increasing control. By 2020, the already $1.3 trillion Millennial market will be fully in charge.
A benchmark report by Retail Systems Research released last month notes that 60% of “product selection” now occurs before shoppers leave home. Mobile influences will skyrocket from 50% of purchases today to 75% in three years.
But the report also predicts that mobile use will eventually become the “glue that ties the physical and digital shopping experiences together.”
This is because, the report notes, “People like to shop. Shopping is entertaining and fun.” Retailers that will thrive are those that integrate mobile into that in-store experience as well as use it to empower employees.
But digital isn’t the only condition that will revolutionize retail.
The IBM-NYU report notes one huge condition that will impact communities is that physical retail space doubled between 1980 and 2010, far faster than warranted by retail sales.
Contraction of that space is accelerating, while much of what will be slower growth in retail sales overall will be online.
Empty retail space flooding back on the market will make it even harder for traditional “brick and mortar” retailers, especially independent, locally owned stores so crucial to quality of life and distinguishing community sense-of-place.
We’ve already heard analysts call for retail giant Wal-Mart to close 100 of its stores as the company moves to smaller footprints half as big in urban stores as noted in this article by a friend, Ed McMahon, who holds the Charles Fraser Chair for Sustainable Development and Environmental Policy at the Urban Land Institute.
According to ULI, there is now more than 1 billion square feet of vacant retail space in America, (mostly in empty big box stores,) largely because the developer-driven churn expanded retail space 5 to 6 times faster than growth in retail sales.
Local governments who haven’t already are well advised to start thinking strategically about how to help locally-owned retailers survive while surviving the upheaval in property values vacant retail space will create. It begins by stopping the insidious practice of subsidizing developers that cater to chains.
The contraction of physical retail space won’t be pretty and the consequences of years of developer-enabled churn will collapse back on communities, neighborhoods and residents. On the bright side, much of this space is disposable. The buildings weren’t made to last anyway, compared to historic structures undergoing adaptive re-use.
As noted in the book entitled Retrofitting Suburbia: Urban Design Solutions for Redesigning Suburbs, by Ellen Dunham-Jones and June Williamson, professors respectively at Georgia Tech and City College of New York, communities are being left with millions of acres of “underperforming asphalt” including dead or dying strip malls.
This may also be an opportunity for communities to greatly expand the ratio of open space and green infrastructure such as urban forest, reminiscent of the early 1800s when so much farmland was vacated in the east as people migrated westward.
It is also an opportunity for communities to become more sustainable, replacing retail innovations such as the disposable economy which began in the mid-1800s with paper shirt fronts and cheap watches according to a fascinating book by Giles Slade entitled Made to Break: Technology and Obsolescence in America.
This occurred about the time Singer and McCormick began “branding” products. The advertising industry was born to sow the seeds of consumer dissatisfaction and by the turn of the century, retailers were incorporating the ideas of obsolescence and disposableness into products.
By 1920, for instance, “55% of American families - nearly every family that could afford a car – already owned one.” So General Motors innovated the “new model year” with incremental and mostly superficial changes.
Retailers had even used disposable products to undermine calls for frugality to aid the war effort during WWI but by WWII, the ethic of recycling took its first toehold among consumers.
Following WWII, buildings, too, were built on the “cheap,” purposely designed not to last or to ultimately be repurposed as earlier buildings have been but to be cookie-cutter and generic and to be torn down and replaced. This purposeful churn has induced sprawl, and in many places, all but extinguished sense of place.
Today, public opinion polls in the United States show that 82% of Americans “feel a sense of pride” when they recycle and the feeling extends to historic preservation and adaptive reuse of those buildings not built to be disposable.
Troubling is that according to Harris Interactive this feeling is lower among men and younger generations. But overall, the ratio of those who feel strongly about this sense of pride in recycling is 5.5-to-1 positive.
More than 6-in-10 Americans feel a sense of guilt when they don’t.
Today, 3-in-4 Americans make an extra effort to recycle outside of their homes with 58% doing so at work, 22% as they walk along city streets and only 16% when they dine out.
Only 22% do so when they are traveling, where airports, train and bus stations, as well as hotel rooms, lag far behind in making recycling convenient. A few hotels now have two in-room waste receptacles with one green for recyclables.
Seattle-Tacoma International Airport is a best practice example of how to make recycling easy in airports and other public transportation facilities. Nearly half of all travelers never or rarely make an effort to recycle.
Harris surveyed only adults, but another area of disconnect for recycling outside the home is in public and private schools. All of this is to say that communities engaged only in getting residents to recycle curbside are missing many other areas in which they should be concerned.
Another huge loophole are apartment complexes and their renters.
Something confirmed in studies of littering is that 54% will trash a recyclable if a recycling bin is not nearby and 17% will throw it on the ground which it eventually threatens water supplies. This percentage is significantly higher in the South.
Significantly, nearly half of Americans now think explicitly about disposal when they look at buying something. That percentage falls to 41% in the South, though.
Most troubling is that a full third of adults in the South make no extra effort to recycle, according to an enlightening book published last year entitled, The Mind of the South, by reporter and essayist Tracy Thompson.
Noting that individual rights—including property rights—are a central American value, the book concludes that in the South we take them to an extreme, blinding us to the rights of groups such as those seeking the right to have clean air and water and scenic beauty.
This often lies at the heart of struggles that seemingly make no sense, such as reactionary legislation in my state seeking to make North Carolina known for huge, mega-landfills and desecration of roadsides as well as the state’s reputation for scenic beauty..
I assume this same mentality will argue against sustainability and in favor of disposable consumerism and developer churn as well as urban forests and green infrastructure.
I suspect some will respond to the strategic issues in this blog with “good, we don’t need quality of life and sense of place anyway.”
We’ve got a ways to go.