Towns, commerce and the future

French towns are withering and losing their core, while shopping centers outside of the cities are booming, as recently described by the New York Times. Meanwhile, in the U.S., the suburbs are going through an equally dramatic transition. Malls are being outcompeted by e-commerce and eventually have to shut down, leading to shrinking demand for chain-restaurants and other services that previously were being frequented by hungry and entertainment-seeking shoppers.

Stories like this could be written about towns in various countries. The creation of shopping clusters outside of city centers and the rise of e-commerce are two global themes that no one will be able to stop. The best way to look at the shift and its negative consequences is therefore with a stoic mindset, following the principle that what you cannot control, you shouldn’t not spend a lot of time trying to control. As long as a city doesn’t force its population to shop at the local stores (which hopefully will never happen), more shops and old school businesses will vanish. The economics and experience of getting things from the giant mall or – increasingly more likely – from the internet, are generally too intriguing for consumers to let the undesirable side effects for the community come in between themselves and the convenient purchase or unbeatable bargain. Continue Reading

From someone in a country without Amazon, a few questions about Alexa

Switzerland and Sweden have a couple of things in common. First, the names seem to be similar enough in many languages so that mixing up both countries is a very common phenomenon. Second, there are certain commonalities in regards to people’s mentality, for example a tendency to avoid conflict (for me, as a German living in Sweden and working with Swiss companies, there has been and still is a lot to learn). Third, in neither of the two countries, Amazon is operating its online store. This is in so far remarkable as I know that many people in Amazon’s core markets cannot even imagine anymore how life would be without the e-commerce giant. The reality from a customer perspective: It’s a bit inconvenient.

For the Swiss, Amazon.ch forwards directly to Amazon.de, offers free standard shipping above a certain order value, and obviously there’s no language barrier navigating the site. However, if you order from Switzerland which is not part of the European Union, you might end up having to pay additional customs charges in order to be able to pickup your package. In Sweden and the other Nordic countries, people are also forced to order from Amazon sites in other European countries (or the U.S.). Local versions in Nordic languages don’t exist. In Sweden, amazon.se is only a parked domain. Continue Reading

Pebble’s most recent crowdfunding success proves that pull manufacturing is the future

Pebble

Some weeks ago I wrote about the many disadvantages of physical retail and why we should abandon it immediately if we could (which we cannot yet for socioeconomic reasons). One thing I did not mention in that post but which most likely will play a crucial role in changes to come for retail is the rise of product manufacturing based on specific demand. One could also call it the switch from push to pull manufacturing.

Until now, most products were produced by companies that could not be sure whether all or even a high percentage of units would be sold. Instead, guess work, predictive market research and individual opinions decided about volumes. Then placements in stores combined with different marketing activities were used to create demand and generate sales. The existing products were “pushed” into the people’s field of attention in the hope that people would buy. Continue Reading