Growing up, we got our milk and our bread at the local store around the corner. But Stop & Shop was much more than that. It was a place where our neighbors stopped by for a chat and to share the latest gossip. It was always as much about the human and social experience as it was about getting groceries.
We know that despite the rapid growth in e-commerce, the desire to try before buy still runs strong among consumers, especially when it comes to Generation Z. According to Forrester Research, by 2018, e-commerce will represent 11 percent of the US market – meaning that a hefty 89 percent of commerce will still happen at the physical point of sale. People like that social experience!
With that in mind, Mastercard recently partnered with Marie Claire to unveil the Next Big Thing store, showcasing retail-focused IoT solutions that bring the in-store experience closer to the digital experience.
But physical retailers are not only challenged by competitors that are originating on the web – they are also up against a very robust social trend. As I have been closely following consumer spending behavior for the last 10+ years it is clear that post the 2008 downturn people started to spend more of their money on experiential purchases – and less for the consumption of hard goods.
Over the course of this year, destinations such as Portugal and Iceland have been particularly successful in attracting international tourists to spend an extra day – for example to discover local food or nature. And American visitors traveling to Europe now allocate just under 25 percent of spending to retail purchases (compared to 50 percent for Chinese tourists), with Denmark being the country where they spend most on food.