By Crosby Renwick
Sure, the Internet plays an aggressive game. It’s looking like the Internet business is trouncing the retail business. However vast an assortment or low the prices a retailer offers, the Internet does it better and cheaper. The prognosticators all say the same thing: What little growth there will be in consumer spending over the next five years is mostly going to happen online.
But, the bricks-and-mortar model can start winning again by leveraging its natural talent with the changing conditions.
Changing conditions? Well, that would be the aging of the marketplace. It’s a fact: Got to go with it. On the face of it, this changing condition looks threatening versus assistive because older people don’t spend as much on goods — they’ve pretty much already bought everything they really need. But they buy services. In fact, for several decades households have been increasing their expenditures on services while expenditures on goods as a percent of all spending have been going down.
Natural talent of retail? That would be service. Yes, service. Haven’t bricks-and-mortar retailers been in the service business all along? Especially mom-and-pop stores, who buy, edit, arrange, display and demonstrate an array of products while bringing them close to the customers. That’s service, I think. It’s a natural talent missing from the Internet; you can’t click and order services. Services most likely require in-person experiences within bricks-and-mortar.
Services for the aging population already happening at retail
We’re already seeing a lot of healthcare coming to retail — from walk-in clinics and urgent care centers to large insurance companies opening storefronts to counsel on health policies. Even laboratory testing has gone this route: AnyTestNow, a national chain of walk-in labs offering any blood or urine tests without a doctor’s prescription, already has over 100 retail sites.
But the explosive growth of the senior population brings with it opportunities that go well beyond storefront medical and insurance services. Here’s just a few of the concepts that could help fill some of those vacancies on Main Street, in malls or in strip centers:
Senior Social Clubs
One of the biggest services retail can provide is bringing like-minded people together. Just like those yoga fans who flock to Lululemon for classes — and, of course, the store’s yoga wear — lots of seniors are going to be looking for company. Here’s the idea: group senior care packaged as “Senior School” or “Senior Social Club” — complete with a gym, reading class, art programs, a woodshop, talent shows. Where do I sign up?
But why locate in retail space? Couldn’t this be done in a church basement or on any other location besides Main Street? Yes, but by being front-and-center, by being at the core of a community rather than hidden away, you increase awareness and acceptance. By being in the center of it all with retail locations, the Senior Social Club doesn’t get forgotten — it’s right in front of you everyday. Drive by, walk by and you’re reminded it’s there. And when Mom or Dad have left the stove on again, the solution is right there.
Simple idea: Look at what Whole Foods Market has done to the supermarket industry by specializing in pure, natural and/or organic. The boomer generation fell for it hard and fueled their growth. In comparison, “conventional” supermarkets now look a little un-natural.
The same opportunity exists in the drugstore business. All the big drug chains turned themselves into convenience stores in the past 20 years. Pharmacy is still a major part of their business, but nobody specializes in it anymore. And, what a giant, dependable business it is. Indeed, the elderly average six prescriptions per person, to be taken every day for the rest of their lives.
The people who shop at Whole Foods, Trader Joe’s and the like are believers in “integrative medicine” — the best of both the eastern and western worlds of healing — naturopathic (plant-based) remedies combined with western pharmaceuticals. The problem is those folks won’t find any national or regional chains that could be deemed ‘The Whole Foods of drug stores.’ To those shoppers, a drug store featuring a ‘natural’ front end amply stocked with herbal remedies, teas, vitamins, supplements, and organic beauty/personal care items, the clinical pharmacy department would appear safer, better, smarter. Staffed with knowledgeable people, an “Integrative Pharmacy” could be a national hit.
Senior Living Superstore
If you’re over 50, you or one of your friends is likely thinking about moving to a house that is more “senior-friendly” — more accessible, no stairs, higher toilets, showers instead of tubs, etc. A Home Depot-type store that could help you modify your existing house could potentially save you thousands of dollars. This one-stop emporium would be a place where you can get a stair lift, grab bars, motion-sensitive lighting or even arrange to have an elevator installed. While we’re at it, let’s surround these home-modification products and services with the thousands of items that have been specifically designed for an aging population — from large-type books to invisible hearing aids. Today, the only retail place where you can access even a modest assortment of these products is a hospital supply store. It’s probably located on the wrong side of town, it’s grey, badly lighted and there’s a wheelchair and toilet seat in the window — and probably a dirty window, to boot. Instant downer.
The opportunity is to bring it all together under one roof, clean it up and make it a pleasant place to shop.
When you think about it, the only place where the Internet beats bricks-and-mortar is on low prices for commodity goods. Who wants to be in that business anyway? Let ‘em have it and let’s get on to targeting growing markets with high-margin services.
Let’s apply what retail really already does better — servicing its clientele — and focus those services on the exploding aging population.