Shopping physical products in dedicated streets was often convenient and sometimes fun. With the advent of digital shopping, we need to rethink the purpose of these streets and how we use them.
The Forces Shaking the Ground Beneath Shopping Streets
Consumer needs for shopping are quite transparent. Most of us love convenience and a bit of seduction and inspiration while shopping. In recent years, a new kid in town has slowly entered the scene: sustainability. Not only do consumers want to shop more sustainable products, they also want to do it in more sustainable ways. On both aspects, online channels currently come out first and the traditional high street store that sells physical products is suffering. Read more about the sustainability of online shopping in this recent article by Maximilian Gellert.
A great manifestation of the online shopping trend across all product categories is the GLORE (GLobal Online REtail) Fund, that shows the development of a mix of retailers focused on selling online. Yes, Covid-19 is certainly helping this trend. And yes, ‘going shopping’ may see a short rebound once we are able to move around more freely again. But the long-term success story of online shopping will continue unbroken.
There will always be traffic on the streets – but we will congregate for human interaction rather than to purchase physical goods. After a moment of relief once the pandemic is under control, the benefits of the much more convenient digital shopping channel will continue to erode our shopping streets.
Let me I just take my own family as an example. While it was certainly the pandemic that provided us with the impetus to try cooking boxes (Hello Fresh), their fundamental relevance and need fulfilment will stay. In our case it’s a mix of conveniences: I don’t need to find a tasty recipe, drive to the supermarket, search and pay for a parking spot, find the ingredients, and carry the goods home, and I don’t have to worry about left over ingredients that will spoil. But what’s even more compelling is the experience element our cooking box provides: Cooking the recipe at home with my daughter and enjoying the time together has become a key reason to continue with the service.
Will cooking boxes replace going to a restaurant with friends for some nice food and socialising? Certainly not. But the box has significantly reduced my number of visits to the local supermarket and decreased my average basket. Why any supermarket chain worth their salt (at least none of the retailers that I see here in Austria) has not yet introduced their own cooking box service is beyond me.
Shopping Physical Goods in a Shopping Street: A 21st Century Dinosaur
With the rise of online retailing came the search for ways out for brick-and-mortar retailers. Lower rents, higher regulation of online retailers, and the expansion of omnichannel services are the preferred levers to pull when trying to save the dinosaurs from extinction. None of them will truly help though.
What role will the flexibility of landlords play? How much longer will they leave buildings vacant, in hope for the return of shoppers? Or will they eventually accept lower rents and/or accept new business and service ideas for their spaces?
Regulating online retailers might be an option (and is currently en vogue with European politicians) but is against consumer preferences and will not prevail. Omnichannel is a band-aid that will help some retailers survive. But it won’t help smaller retailers without the means to invest in some of these technically complex solutions.
Let’s face it: Like dinosaurs, many retailers selling physical products on shopping streets will perish. It’s time to begin rethinking the usage of these city-centre shopping streets. Let’s not protect the old but dream big and focus on creating something new.
Moving Away from Pure Consumerism
For those dreading the monotony of seeing the same brands everywhere, now is your time to help shape the future of what a shopping street can look like. While repurposing former industrial areas like Hafencity Hamburg or the Hafen Duesseldorf is already well established, now it’s time to start rethinking our outdated city-centre shopping streets.
With a joint effort from city planning officials, real estate developers and us, the inhabitants of these great cities, we have a huge opportunity at our hands to shape a better future. This will not be an overnight process but the ground has already begun to shift.
So, what might the future look like? I am thinking of aspirational places in which people can live, work, play and shop. Yes, shop. It is the relative priority that shopping receives vis-à-vis other elements that makes all the difference. While today shopping is the primary objective on most city-centre shopping streets, it may be much less important in the future.
In fact, the mix could and should allow social life to re-enter these areas, instead of the current on/off times that depend on shopping hours. It is about finding a mix of offices, homes, theatres, hotels etc. that support around-the-clock life. It is not about the uniformity of offers, but about the right mix to turn shopping streets into places with a life and soul that deserve to be called a city centre.
Four Ways of Repurposing Shopping Streets
Larger empty spaces, for example department store buildings, could be used by art galleries, or as practice rooms for bands. Pop-up retail concepts are currently also en-vogue, even though they do run counter to some of the ideas offered in this article.
Transforming for residential use:
The image below, for example, was taken in Berlin Kreuzberg and shows a former store that was repurposed into an apartment.
If you are not too fussy about your privacy, this might be for you. For bigger buildings, it could also be interesting to repurpose the ground floors, currently often used as commercial units, into parcel drop off stations to satisfy tenants’ increased online shopping needs!
Services that require physical presence:
This is a not new idea. But given the likely decrease in rents, it might regain popularity particularly due to the often excellent connection to public transportation. Gyms, Doctors and anything to do with physical well-being (like rehabilitation or massages), or even various sports offerings may also be interested in these locations.
Yes, you have read correctly. Production businesses in urban locations. Whenever a production process requires few (natural) resources and is low in emissions, it can be considered for city-centre locations. The store of a former fashion retailer in Solingen, for example, is in the process of becoming a ‘see-through factory’ where you will find a mix of retail shops, small manufacturing businesses, and office spaces for creatives.
Or have a look at this urban coffee roastery with café in Cologne, Germany:
And of course, if there is still too much space, why not create a green public recreation areas for everyone to enjoy.
Now Is the Perfect Time to Act
What time-frame are we talking about? As with the introduction of renewable energy sources, these processes are slow and will probably require some regulatory action by local or regional governments. But like with all great things, we have to start somewhere. And now is the perfect time to think about the future purpose of the city-centre rather than dwell on how to prolong the often dreadful existence of today’s shopping streets.
Featured image credit: Cha già José (CC BY-SA 2.0)
About the Author:
Christoph Berendes is a consultant in strategy development and process optimisation for fashion brands and retailers. He has more than 15 years of experience as a consultant, line manager in the sportswear industry and in e-commerce marketplace distribution. Read more of his work here or connect with him on LinkedIn.