The future of retail will depend on the innovators, according to Kevin Kelley, AIA, co-founder and principal of strategy and design firm, Shook Kelley.
“Retail is about the fashion of the times; therefore, it's essential for brands to look like a societal leader, not a laggard,” he said.
Kelley will present during the Specialty Food Association's Fancy Food 24/7 digital event, taking place September 27 - October 8. His session, The Bonfire Effect: How Physical Retail will Survive a Digital Future, will take place Wednesday, September 29 at 11 a.m. EST.
Kelley spoke with SFA News Daily about ecommerce trends and his advice for retailers as they look to the future.
How has ecommerce shaped the retail industry over the last few years?
While the effects of ecommerce are numerous, the most fundamental is its pressure to force retailers to decide whether they're going to sell commodities based on price, convenience, and ruthless efficiencies or sell experiences, social encounters, curation, adventure, and a sense of belonging.
One position is more of a utilitarian value proposition, while the other entails a more expanded value equation, where the features go beyond just the mere product into intangible, but “felt" qualities. While it's true that humans like to acquire goods at the lowest costs possible, once we get our basic needs met, we seek to surround our purchases with a greater level of meaning, identity, and social aspects.
Many traditional retailers have tried "riding the fence" between these two strategies, but this approach creates a weak value proposition and market position. Consumers today seek more extreme positions.
What are some surprising shifts in consumer behavior over the course of 2021?
Outside of COVID migrating a large swath of non-digital consumers to their platforms, there has been a fundamental shift from vanity, self, and materialism toward home, family, and community. We see this more noble trend lasting for a while until the memory of the pandemic fades.
Humans are a creative bunch, and they will always find ways to make life interesting, fun, and social, even when trapped in a cave or house arrest during the pandemic. There is a lot more money in cocooning than most retailers realize. But far too many brands are still selling the lifestyle of vanity, ego, and individualism and not tapping into the changing topics of national discussion.
What trends do you see coming in the last quarter of the year?
For the last few thousand years, humans left the safe confines of their homes to explore and connect with the world "out there"—whether it be the church, theater, market, high street, pubs, cafes, mall, or public square. But the pandemic forced a lockdown that was unnatural in terms of human behavior.
As social animals, we're not designed to be inside one familiar setting this long. It creates a cognitive impairment and affects our ability to remember things, distinguish our memories and keep our brain sharp. Our sensory organs—taste, touch, hearing, smell, and sight—need sensory activation and stimulation in new and different environments. We also need to see people—strangers essentially—beyond our friends and family to learn how to behave and feel like we belong to something bigger, even if it's a temporary community like an outdoor mall or farmers' market.
We're already seeing ample evidence that consumers have had enough house arrest and are going "out there" despite the risks and hazards. We anticipate this consumer ambition to increase towards the year's end, even with the variant. Both consumers and places seem much more prepared to deal with social distancing, masks, and sanitary measures than we were back in March 2020. The innovations to retail, customer service, and engagement we've been involved with are much more sophisticated this time around.
Do you have any advice for retailers hoping to better connect with consumers?
Far too many retailers have this tendency to lay back to see what others are going to do next. But this "wait and see" attitude leads to missing pivotal cultural curves and a follower mentality.
The most progressive retailers we work with are already knee-deep with securing sites, plans, permits, and construction contracts to create new retail innovations and social experiences that will be ready to open up as a first mover's advantage. I encourage retailers to use this slightly dormant time to develop new and innovative ways to create value and experiences the market will react to when the coast is clear.
Related: Fancy Food 24/7 to Feature Fast Pitch Friday; Walmart US CEO Speaks on 'New Normal'.