Mega Pop-Ups Will Sprout Like Weeds
In 2013, Pop Up retail will venture beyond concepts like Ebay’s social media temp store in London, or the Nintendo demo shop in San Francisco. Instead of these boutique-level brand-centric concepts, look for large scale, multi-unit holiday-based concepts trolling for much more significant dollars. Moreover, with pop-up retailers taking their unfair share of $8B worth of Halloween revenue and big box retailers abandoning their 40k square foot stores as fast as humanly possible, look for “retailtrepreneurs” to start blowing out other heavy shopping occasion opportunities like Back-to-School (ideal for 10,000 square feet from late July through September), or Black Friday, which has clearly burst way beyond the boundaries of a single day. In effect, the “Black Friday store,” online or off, is a locked and loaded winning brand proposition for anyone smart enough to grab and leverage it.
Appliances and Home Automation Goes Boom
Older Millennials with young, growing families who are considering new homes won’t soon forget their struggles through the recession and will likely be more apt to invest in their current homes than new ones: Enter home upgrades in the form of some fancy new hardware and software: Expect record breaking appliance sales of high-touch, high-tech Whirlpools, Samsungs and LGs – sales strong enough perhaps to drag Sears through a year of a little less red ink thanks to Kenmore – but certainly a boom to Home Depot, Lowes, and h.h. gregg. Also, Time Warner, Comcast, and even Apple – anyone with either a pipeline or a camera in your home will challenge ADT in home security and automation: Suddenly friendlier and more affordable software linked to smartphone aps make it not just possible, but easy.
While the Devil may wear Prada, he probably bought it at an American retailer like Saks or Bergdorfs. But that’s about to change because like the automotive category (Toyota, Honda and Nissan), and music (The British Invasion), the American retail landscape is turning international and fast. First you’ve got Japan’s deconstructed playa Uniqlo: Think Gap meets anime, deconstruction meets expansion, and street style fashion that makes other apparel merchants watch and shudder, i.e. a $12B mega brand is focused on quality for the masses. Zara, perfectly suited to the Millennial attention span with their twice-monthly insertion of new products; Topshop, with their secret spaces and a planogram that’s somewhat a derivative of Anthropologie. While Topshop’s Flagship London store offers a nail bar, hair salon and one-hour tailoring, its U.S. stores may eschew much of that and instead deliver “gypsy rocker” designs and designers – Kate, Stella Vine, and others. Once again, value proposition trumps all and “same ‘ole store” for less is not remotely as compelling as “fresh and new” and low enough in any language.
Healthier Crappy Food
As fast casual concepts continue to lead the $12B restaurant industry, expect new “healthy eating” concepts to arise like so many fresh avocados. Yes, duplicitous America will continue to at once become more obese and healthy, but while those Americans who crave high fat, hormone rich chicken, or other foods plump with corn syrup or trans fat are amply represented, the other side of the table will now have their day: Look for concepts like Evos or veggie-juice based versions of Jamba Juice to first show up in the fast casual space, but then trickle down to QSR. Gluten-free, organic, and hormone free… these are not fringe terms anymore, and 78 million boomers who want to live forever will exit the treadmill and find themselves craving the good stuff.
The End Of The “We’re Closed” Sign
While we’re talking Black Friday, mark your calendars because November 22, 2012 (Thanksgiving Day, i.e. Black Thursday) will forever be remembered as the date when brick and mortar retailers realized that every holiday, every day in fact is a shopping occasion, and that an open store can be a profitable store no matter what day or time it is: Within the next two years, there will be no days off at brick and mortars. (Hell, ecommerce and pure plays like Amazon never close, why should the mall?)
On Thanksgiving night, Walmart, Target, Sears, h.h gregg and major malls from Opry Mills in Nashville (shuttered 24 months ago but on Thanksgiving night dealing with massive lines at all seven entrances) to Florida’s Sawgrass Mills were just as busy at 1:00AM as they were at 8:00AM as shoppers were clearly galvanized by the chance to grab deals early and beat the Black Friday rush. And by the end of the weekend, an estimated 147 million Americans had been shopping in stores, with 76 million more saying they would track stores and sales throughout the weekend.
But this isn’t just about extending the boundaries of Black Friday. Yes, shopping on Thanksgiving Day became an instant blueprint for 2013. But beyond that, we can now expect to see Christmas Eve shopping that extends straight into Christmas morning, New Year’s Day and Easter to create sales event energy, and more middle of the night madness.
We all know that people will literally trample themselves to death with the lure of a great deal. Is it so hard to believe that on any given holiday the tough will go shopping? Just like Internet pure plays… 2013 will be the year that brick and mortar officially becomes a 24/7 business.
Throwing The Sale Under The Bus
In 2013, the floodgates will open and marketers will do anything and sacrifice everything for consumer data. I mean, why give anyone a deal if you’re not collecting data in return… a rock-solid email, phone, or address for starters. In the same way Jeff Bezos is practically giving away Kindles and tanking on margin all to build his data fortress, more brands will start seeing data not as icing on the sale, but the very purpose of the sale. So to those bean counters who’ve always said that cash today is more valuable than cash tomorrow, today’s lesson is not always: The new math is this: A low margin sale that collects data today is worth the data-leveraged high margin sale tomorrow.
The Merchandise-to-Marketing Apocalypse
Once there was Main Street, if you owned Tony’s Sporting Goods or Nancy’s Salon or Bill’s Pet store, then just having the merchandise was enough. But as commoditization has run amok, more brands are finally understanding that there simply are no more products and services, only the marketing that decommoditizes them. Remember, at one point Walmart was a world-class merchandiser, having practically invented supply chain management and just-in-time inventory. Yet in 2008, even their 100,000 SKUs for “always low prices” wasn’t enough. They reinvented their brand and upped their media 70% to $853 million. That’s great merchandising turning into great marketing. Better still, think about Geico. In a category without a pulse, they turned a brilliant online merchandising model into a marketing juggernaut, not just with a killer value proposition (Give us fifteen minutes…) and watershed creative, but with their own 70% increase in media to nearly $500M, which was twice as much as shell-shocked Allstate and State Farm. Geico used its commodity busting merchandising and marketing model to fuel the rocket that took them to #2 in a category where only 11% of the customers change carriers, and will surely take over the #1 spot at some point. The key is that as more brands have become undervalued and scooped by private equity, more cash is available to quickly pursue a killing. So look for 2013 to be the year that more brands in low-interest, under-marketed categories – insurance, hospitals, pharmacies, bicycle stores, tourist destinations – follow-the Geico lead, turn up volume big time on their marketing, and transform sleepy categories into top of mind hits. All it takes is a gecko and some very deep pockets.