The Perfect Storm, or at very least a very big one ….


It is nothing to do with Brexit, it is not Trump, North Korea or banking (although three major banks in Europe have collapsed in the last couple of weeks), it is to do with retailing .

The big players in retailing are diversifying at a rapid rate. Amazon, the devil incarnate, not only started opening books shops they have just purchased a grocery chain (Whole Foods -mainly USA, but does have stores in the U.K.). Tesco seeking to move into wholesaling (Bookers), Sainsbury’s trying to buy NISA , a buying group of independents. Ocado, the giant UK online food operation is seeking to replicate its model throughout Europe.Major car brands opening car showrooms in shopping centres. Online operations  are going forwards and backwards, and the end consumer is undergoing a complete psychological restructuring . The electrification of cars will restructure the retail landscape in ways that have yet to be explained (come back to that in a minute).Not least, the latest approaching whirlwinds, Big Data and AI. These two alone will be more than capable of forming their own retail hurricanes.

Big data, is what is says it is :

extremely large data sets that may be analysed computationally to reveal patterns, trends, and associations, especially relating to human behaviour and interactions.

It is said that 90 % of data available to mankind was created within the last two years. Only the biggest have the resources to handle this data and what they do with this is anybody’s guess. Lucifer (aka Amazon) offers some pointers. Currently they are experimenting with Amazon Go, a completely ’tillless’ experience. You walk in, take what you want , walk out entirely till free. It is a retail ‘holy grail’. Initially, it ain’t bad for the consumer. If there is anything to ruin what enjoyment , you may or may not, experience shopping , it is soon ruined by the queue at the checkout .To reach this stage , Lucifer has had to absorb, crunch , diagnose , and utilise big data. Even  they (or rather he, she or it, whatever Lucifer is) find that not all is hunky dory. Yet as sure as Lucifer sells books, it will happen. 

Electric cars, now there is something I don’t think has been thought through , the consequences that is. I am not against , and would be quite happy,if the price dropped and the charge lasted 500+ miles, to buy one. Petrol forecourts are a reducing breed anyway, but the petrol need bit will disappear entirely . In its place will be re-charging centres, presumably? However, instead of a 5 minute fill and maybe a packet of crisps, inordinately expensive packet of liquorice allsorts , and an amazingly low priced Apple Watch ‘look a likey’ guaranteed for over 72 hours, the car occupants will be there for at least 30 mins. So what’s to do ? More cafés, a small shopping mall, profits will need to be made.  The oil companies will have to completely overall their business models of retail forecourts, which, I suggest, will have their own impact of other retail concepts.

Artificial Intelligence, is with us , or very nearly , in the form of driverless cars. It is used every day by Apple, with Siri, or Microsoft with Cortana. Google search is driven by AI. Currently, we are in a place in time when we can talk to a small device in our kitchen and order a toilet roll. This can only be the beginning. As to what that ‘beginning ‘ maybe, is very unclear . What is clear is that the impact on retailing will be of ‘storm force’ proportions. 

Storms create problems but they also create opportunities and whether you are supplier, retailer or even consumer, we have to mitigate the problems and seek the opportunities. Sounds so easy when you write it.

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