Published on page B2 of the May 7, 2006 issue of the Philippine Daily Inquirer
AUTHOR and science of shopping guru Paco Underhill recently talked about interesting developments in the retail industry based on his clients worldwide:
1. Cutting edge of retail is generally where money is young.
Underhill stated money is not young in London, Paris, Frankfurt and New York. But it is young in Moscow, Dublin, Sao Paolo, Mexico City, Shanghai, Mumbai.
2. One of the primary motivations of construction is how to control labor costs.
Labor cost is not an issue in places like the Philippines, Mexico and Brazil. "Emerging markets are less likely to look to Europe and North America for ideas. Emerging markets need to start leading."
3. How do I fit into a multi-tasking life?
Underhill stated "value is not just a price issue. Price is not the only factor that determines whether a person will buy a product, consumers are looking at values and merits."
4. The Ma and Pa stores are booming.
Consumer firms acknowledge that these stores will be a major contributor to sales growth.
5. Social stratification of retail is over.
Underhill stated that in the past, the rich do not cross over to shopping in mass-based shops, but today, "Forbes Park residents are comfortable buying a Coke from a sari-sari store."
6. Used is cool.
The popularity of used clothes or ukay-ukay is not just a trend in the Philippines. Underhill said there are stores in Japan that span several floors, selling used clothes, ebay and Craig's List carry second hand items for sale.
7. Finding new ways to sell the same stuff.
8. Lingerie and mobile are the hottest products.
9. Most staff in emerging market are highly motivated, well-educated, and trainable and loyal.
10. The use of shopping carts is declining as shopping missions change. Consumers go to stores more often in the 21st century than 20 years ago. Design for private labels is one of the opportunities in Philippine packaging.
11. Family eating rituals are changing.
12. Shoppers of clothes are two kinds—those who buy for special occasions; and those who buy for everyday wear.
"Many labels fall in love with the Saturday night market but the market is the Monday to Friday."
13. The emerging market innovation is finding ways to get beyond the price. Underhill cited the Roppongi Hills mall which is a shopping complex, library, art museum, commercial office, hotel, residential place in one.
14. Selling to women. Shops have to adjust to the women market in terms of design, amenities and better understanding of why women shop.
15. Design alone is not the answer—the fastest growing retail channel are anti-design.
16. Mall owners need to evolve from landlords to place-makers —owning malls is not just about real estate and collecting rent.
17. It's important for businesses and their staff to be having fun because chances are consumers are having fun too.
18. It is all about solutions—understanding and innovating at the point of sale; learning how to compete with everyone; balancing global needs with local identities.
M.Q. Espino
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