It seems as though every couple of weeks, the media reports how retail is dying, sales are down and stores are closing. Many media sources use the advent of online shopping to blame the mass failure of many staple stores which have been around for many years.
I, however feel differently. Part of the reason being is that in the current climate many households do not have disposable income due to the rising cost of living. But moreover, younger generations are just not purchasing and consuming stuff at the rate in which retailers and marketers encourage and want/need them to. This is a big problem for those aiming to sell and make a buck. Younger generations are also struggling to get into the housing market and when they do are generally buying smaller homes which have limited space to store stuff.
There is also a noticeable trend towards experiences, travel and eating out as opposed to buying material goods so in many cases it’s not even a lack of spending, but rather a shift in terms of where people are choosing to spend their money. Recently iconic makeup brand Napoleon Perdis went into administration and when a household name like this starts to fall apart it helps to highlight changing economic and consumer behaviours (who, by the way also had an online platform as well as brick and mortar stores). My mother frequently says to me after she’s been to the local shopping centre that the shops were quiet but the coffee shops were packed. Perhaps people are having their smashed avocado on toast instead of a new outfit? Is this in itself evidence hospitality is growing and retail is slowing? But the dollars are still flowing into the economy, just in a slightly different way.
I’m very curious to see how future generations spend their money and how this will shape our society in years to come. Will ‘stuff’ become a thing of the past and experiences and dining out reign supreme? How will changes in the size of our homes and even our ability to afford housing affect the consumer goods we buy? It’s something I’m excited to see play out in the coming years.
How have your consumer spending habits shifted?