Executive Vice President of retail business Cardtronics
Though online shopping has indeed become a behemoth, those who spent the last decades prophesizing the end of the brick-and-mortar retailor stand today with a fair bit of egg on their face, at least here in Canada. The data clearly shows that Canadians still overwhelmingly spend their time and money out in the world, shopping in physical stores with cash in hand. In fact, only 20 per cent of Canadians say that they prefer to shop online, compared to a whopping 48 per cent south of the border.
The Rise of The Personal Shopping Experience
The key to not just surviving, but thriving, in this retail landscape is understanding what it is that motivates consumers to visit a physical store over a website, and what keeps them coming back once they do. Trends in consumer behaviour are a moving target, so vigilance and adaptability are required to succeed in the retail space. But success is still very much an option. “There’s this idea of the retail apocalypse that keeps being bandied around, but I don’t think that’s coming,” says Bill Knoll, executive vice president of retail business at Cardtronics. “What we’re seeing instead is a slow erosion of generalized shopping in favour of more personalized and boutique-style experiences.”
The boutique phenomena is multi-faceted, but a big part of it seems to boil down to fatigue with impersonal all-purpose superstores. When shopping is routine and tedious, Canadians are more likely to shop online. And so, when we do go shopping in our communities, we want to be catered to. “Big department stores are not the destinations they once were,” says Knoll. “Today, people particularly value having access to specialized salespeople who are more knowledgeable about a rich selection of products in a specific category. When a retailor is paying attention to a customer’s needs above and beyond simply the products provided, it turns shopping into an experience rather than a chore.”
Canadians Are Using Their Wallets as Social Tools
Another motivation driving the success of smaller retailors is an increasing sense of social and environmental responsibility. Today’s consumers are well aware that the way they spend their money has a direct effect on the world around them. Canadians have started to vote with their wallets through a marked preference for fair trade or made-in-Canada products, as well as favoring stores that can show a green commitment and supply chain.
Specifically, more and more Canadians are prioritizing homegrown independent businesses that have smaller footprints and larger local impact. “There’s an ongoing trend towards supporting local retailers,” agrees Knoll. “Canadians understand that when you support local business, you are helping people who live in your community and, in turn, you’re enriching that community. All of the studies and surveys have shown that Canadians are willing to pay a little bit more to promote things like social engagement and environmental sustainability through their purchases, rather than simply feeding into the bottom line of a big company.”
Still, Convenience Can Not Take a Back Seat
At the same time, the pace of life in Canada is not slowing down. Even as we gravitate towards specialty retailers, we are also preferring to make fewer overall shopping trips, and the average consumer is buying more on any given outing. This means that location is more important than ever, and it’s always been extremely important. It also means that, even for boutique stores, there is a lot of value in being able to provide convenience through secondary services like an ATM.
It may seem, on the surface, that nothing could be more convenient than making a purchase with the click of a mouse, but try telling that to someone who’s sick and needs cold medicine, or someone who’s hungry and needs a sandwich, or someone who’s going to be on the road all day and needs cash in their wallet. There are some things that just can’t wait for the mail truck to arrive. When a customer is able to bundle several urgent needs into a single shopping trip, the memory of that convenience sticks with them and influences their future behaviour.
Adapt to Thrive
Sustainability, convenience, and customer experience: These are the new values that are driving consumer behaviour in 2019 and beyond. These are the touchstones that keep Canadians walking through shop doors rather than filling online shopping carts. If physical retailors are struggling in today’s environment, they would do well to look closely at these shifting trends in consumer preference before simply assuming that online shopping is the problem. Because the truth is that Canadians are still out there every day, taking cash out of physical ATMs and spending it at physical storefronts.