December 26, 2020

Retail pundits predict 2021 and beyond

Pythia, an ancient Greek soothsayer (photo: Olga Kuevda_shutterstock)
Olga Kuevda_shutterstock
The mother of all soothsayers is regrettably no longer available to advise traders on the marketplace
Who would have thought it this time last year? Our panel of experts would have been laughed out of court had they predicted that today's consumers would be wearing protective masks on eerily quiet shopping streets, while fearing both infection from the coronavirus and the worst recession in generations.

And what a year it has been! In 2020 trade, political and social cohesion, and even our well-being have been challenged as seldom before in peacetime. In this chaos and turbulence, experts and advisors are needed more than ever to provide their confused fellow mortals with at least some form of a guide. 
 
If the scourge of Covid-19 has any silver lining at all, it might be that months of working in home, sorry, mobile office and holding video conferences may have forced some of the more reflective to reimagine capitalism as we know it. Perhaps it is demanding too much of our international trade gurus to reconfigure our whole system, but how about retail?

We therefore asked them: What do you see as the most significant or exciting development in retailing/fmcg manufacturing and challenge for the future?

One could add a host of other questions before they start: To what extent does the coronavirus pandemic call globalisation into question? Must managers take planes and drastically increase their carbon footprint only to exchange the same kind of platitudes they are wont to make online? Do European consumers need to have strawberries flown in from Kenya every winter?

Covid vaccine (photo: MarsBars/iStock by Getty)
MarsBars/iStock by Getty
Hope in a bottle
As more and more tasks are crowd-sourced in our increasingly digital world how can we stop people becoming alienated from their work? 
Can our environment survive more plastic consumer goods packaging and diesel-powered delivery vehicles? Are we really happier, the more we consume? Open shops and restaurants are essential to a thriving economy, but are they more important than the preservation of life during a pandemic?

Despite these burning issues, there is at least some reason for optimism in 2021 and beyond:

Governments are preparing to roll out mass inoculation programmes, so shops, cafés, hotels and restaurants could be up and running again as early as spring; recessionary forces will also wain with herd immunisation; a naughty schoolboy will leave the White House, making international trade deals and climate accords possible again; and all Brits who voted for 'Bremain' will be delighted that Brexit has at least been concluded with a free trade deal, thereby obviating burdensome tariffs and quotas while reducing the danger of a downward spiral in future relations with the EU.

But let's see now how our distinguished panel balance hope and fear in their answers:


Brave New Post-Covid World



Dagmar BottenbruchAngel Investor & Consultant, Berlin:


Dagmar Bottenbruch, angel investor & consultant (photo: Dagmar Bottenbruch)
D. Bottenbruch
Dagmar Bottenbruch: "Packaging remains a huge issue"
"Next year will still be totally affected by Corona, of course, with major consequences for the hospitality sector, particularly for the smaller independent operators. This is absolutely dramatic and will affect our inner cities in a terrible way. Everything digital is receiving a massive tail wind at the expense of a diverse local offering.

In the interim, nothing is more important than saving lives. But some of the precautionary measures taken are at least debatable. For instance, most restaurants and shops had already implemented all necessary safety measures before the renewed (partial) lockdowns. Also, as the current developments show, the closing of restaurants doesn't seem to reduce infection levels and mortality rates.

I'm not sure that Corona calls globalisation completely into question. However, one thing is clear: A complete dependence on mission-critical products, as shown with protective gear and masks, is very dangerous. This is obviously especially true for medical items, pharmaceuticals, and certainly also certain food products.



In Germany, for example, it has also become dangerously clear that the 'outsourcing' of practically all harvesting labour to seasonal workers from abroad is perhaps not the best idea.

Furthermore, it would seem business and tourist travel activity were a bit 'out of control'. Airports were functioning way beyond full capacity and exaggerated tourism in certain areas and cities had started to lead to opposition from locals. Clearly, however, falling into the other extreme is also not a good solution.



Some business travel is absolutely necessary, especially when it comes to engineering work, and certainly also for strategic exchanges from time to time. Communication suffers badly when there are no physical meetings for extended periods. However, it is also clear that many meetings don't have to be held in person, and regular meetings (such as Boards) don't always have to happen physically.

Plastic bottle washed up on the shore (photo: weixx Fotolia)
weixx Fotolia
Message in a bottle
I don't think we need strawberries and roses flown in in the winter. But where does one draw the line? And how do you explain this to the people whose lives depend on these jobs? At the end of the day, the consumer has to make that decision at the Point of Sale.

Corona shows once more how different people are. Some thrive in their home offices, others suffer greatly. The best, of course, would be the proper matching of work mindset and work requirements. I'm pretty confident that, after a few years of adjustment, most people will end up in a place they can cope well with.

Packaging is a huge issue, greatly exacerbated by the surge in online ordering when many stores and restaurants were closed. There is no easy answer here. Reusable delivery boxes might be a solution. But any such system would be very hard and time-consuming to implement if you really want to create an all-embracing system with many participants on both the supply and demand side.

However, the trend is clearly up, up, up which means huge amounts of trash from packaging, high pollution levels, and traffic issues caused by delivery vehicles.

Meanwhile, some consumers are happy, and others are not. But the partial lockdown has also shown many of us that there are a lot of things that one doesn't really need. This realisation will gain speed and traction, but it will be a long time before there is any real impact."

 

Linda EathertonFounder, Eatherton ConsultingChicago:


Linda Eatherton, Founder, Eatherton Consulting (photo: Ketchum)
Ketchum
Linda Eatherton: "Out of chaos comes order"
"It goes without saying that 2020 was a year most are anxious to see come to an end. While we are eager to put the disruption in our rear-view mirrors, there may be reason to stop and look more closely before we enter 2021.

Out of pain comes healing. Out of chaos comes order. The learnings and the changes borne of this pandemic period will be the silver lining that makes us all stronger.

We learned that our supply chain was breakable and the fragility of our interdependent system was underappreciated. We learned that our production facilities and our retail venues need to be reworked for optimum employee safety. We learned that consumers, when faced with real health & safety issues, turned to food they can trust made by people they trust; food that respects our planet and its resources.

We learned the market is ready to embrace more digital shopping options. We were reminded that our businesses, our people, and our products are essential…to life, health, the economy and the social fabric of our world.

Changes are hard to make. And the hardest changes are the ones we make when there are no other choices. I could contend that these hard choices and tough adjustments will all ultimately make us a better, more reliable, and more relevant industry capable of feeding a hungry world in good times and bad."


Martin GaberPartner responsible for German-speaking countries & international, JosDeVries, Munich:

Martin Gaber, Partner at JosDeVries (photo: JosDeVries)
JosDeVries
Martin Gaber: "Light at the end of the tunnel"
"2021 will be the 'light at the end of the tunnel' year. We estimate that, after a difficult first quarter, the rest of 2021 will be more normal — and that this will have a strong impact on the retail sector as well. The food retail industry in particular has experienced unexpectedly high sales growth this year. So, comparable growth will probably be negative in 2021, which again will put more pressure on the different retail formats. 

Therefore, we expect retailers will reconcentrate on the transition process of their store formats — bringing a new approach to multi-format retailing, investing in a seamless customer journey, and focusing on an optimal integration of food service and food retail. Here our strategic design agency offers its expertise and can help retailers reach their goals."



Dr Kay HafnerCEO, Hafner & Cie., Digital Change And Strategy GmbH, Essen, Germany:

Dr Kay Hafner (photo: Hafner & Cie)
Hafner & Cie
Kay Hafner: "Challenge your roots"
"My prediction for 2021 is that 'business building' will make the difference between success and failure. A new wave of 'intrapreneurial' innovation will be the winning formula for the coming years. Entrepreneurial concepts, like buying companies or starting new ventures, will be less successful than new ideas which boost organic growth and improve the strengths of your company.

Business building opens the path to new digital products, distribution channels, and services to meet the opportunities of an ever faster changing world. Covid-19 accelerated the need for the transformation of established business concepts. You have to keep pace with constantly shifting customer and market trends.

Looking for insight along your value chain is more important than deal making, because you readapt your success factors to the changing environment. True business builders will increase resilience in a crisis and during a time of radical market changes.

Winning companies are successful from day one because they are built for scale and real demand and not for the gratification of some manager's or owner's pet project.

Creating a customer base at a cost that will allow you to achieve profitable sales may sound like an easy task. But building any such business requires inspirational leaders and competent external experts.

Don't bet on single business areas and corporate units, diversify risks around the core of your company. Combine your traditional corporate strength with the agility of a start-up. Identify cross-functional teams who are willing to manage the building process and who challenge your roots with drive and extraordinary initiatives."



Tim Harrap
Head of Collaboration, Lye Cross Farm, Redhill, Bristol, UK; @WorldTradeMaven:

Tim Harrap, Head of Collaboration, Lye Cross Farm (photo: T. Harrap)
T. Harrap
Tim Harrap: "The pendulum always swings back"
"The Covid butterfly flapped its wings in 2020 and chaos ensued worldwide. Production plans were thrown out the window, forecasting lost all relevance, and food service disappeared. Never has our industry faced such a calamitous time. Sadly, some businesses have already closed, and recessionary pressures will impact further through increased and significant unemployment and business closures.

It remains to be seen whether humanity has taken on board the impact of Covid for their psychological and economic well-being. The airlines have grounded their planes, potentially not returning to full service for a couple of years or more — that speaks volumes for the period ahead.

The platitudinous soundbite #buildbackbetter needs to be called out for its vacuousness. It is not addressing the fundamental challenges to the capitalist economic model where, particularly, financial capitalism's rent-seeking distresses the economic well-being of wider society.

Ruth Bader Ginsburg reminded us to keep the faith and that the pendulum always swings back however hard the current times seem. To that end, consider the merits of the Chinese market — there might still be commercial opportunities for individual businesses.

However, the unwinding of the Belt & Road initiative into a debt crisis for China as local populations turn away from out-and-out consumerism does raise the question as to whether the People's Republic can continue on its current path?
I would therefore suggest that the 'Year of the Ox' is going to be difficult for China."

 


Ibrahim Ibrahim
Managing Director, Portland Design, London:

Ibrahim Ibrahim, CEO Portland (photo: Portland)
Portland
Ibrahim Ibrahim: "Let's work together to rediscover the highs of High Streets"
"The key issue for quite a while now, and one that has been exposed this year by Covid, is how the seismic shifts in retail are impacting our town centres and local communities. There is no time to waste in addressing the dichotomy between the dependency on physical retail and its decline.

The internet has taken business away from physical retail. However, I passionately believe the internet will not kill High Streets, but will liberate them! Firstly, we must overcome the pandemic of mediocrity and 'cookie cutter' retail that has lost its relevance to communities and consumers. 

We must shift the emphasis of our High Streets from a 'shopping' to a 'community' rhythm. We should urgently re-think old siloed 'mixed-use' towards connected 'blended-use'. Here workplace, residential, education, hospitality, health & wellness, 'maker spaces', and community amenities seamlessly blend with retail, food & beverages as well as entertainment.

This would create the 'connective tissue' that can reactivate our public realm and encourage constant footfall and engagement, while driving value above ground. To accommodate this shift, we will need to adopt a 'community curation' approach that transcends 'leasing boxes'.

Imbuing our High Streets with a truly authentic 'spirit of place' will involve a mix of unique experiences that align with the community and reflect the essence of the place.

A 'future-ready' master planning approach will facilitate the programming of our High Streets, while blending local independents and start-ups with national and international brands. This will deliver both permanent and transient experiences.

With the introduction of flexible lease models, we will also be able to keep good occupiers while attracting new players and creating High Street incubator platforms.

Ye olde shoppe boarded up (photo: Stephen Barnes_shutterstock)
Stephen Barnes_shutterstock
Digital boom: Covid has greatly accelerated the trend towards online shopping. But at what cost?
As many physical shops shift from being focussed on transaction to customer recruitment, they will increasingly behave like media. Fixed leases will often not be fit for purpose, so new data-driven lease models will need to be developed to demonstrate how physical space can drive media impressions, engagement with social media, and downstream e-commerce. This will be one of the many new ways to revalue physical space.

Additionally, retail is increasingly polarising with autonomous, hyper-convenient, zero-touch experiences at one extreme, and immersive, participatory experiences at the other. We have also seen the growth of the 'by appointment' and subscription economies — both accelerated by Covid-19. 

Covid-19 has also speeded up the focus on wellness, which has ceased to be just a commercial category. Physical and mental wellness must form part of the DNA of all businesses and our High Streets. A biophilic approach to the design of our public spaces is now a priority. This extends beyond 'greening' to wider sustainability and connection to nature using natural materials, water, light, and open spaces with the sounds and aromas of nature.

We are entering an era where people demand genuine value and experiences that deliver surprise and newness. Our aim should be to create places that are 'serendipity machines' and which build anticipation, engagement, repeat visits and a true sense of belonging.

As Alain De Botton suggested in his book 'Architecture of Happiness', we need to bring 'back-of-house' activities such as making, education, workshops, artisans etc. into the public sphere in order to create interest and to intrigue the customer.

Let's make sure all stakeholders work together to rediscover the highs of our High Streets."

Boris PlanerRetail Consultant, Frankfurt:

Boris Planer, Independent Retail Consultant (photo: World Retail Congress)
World Retail Congress
Boris Planer: "Generation Greta will demand values, purpose and experience"
"Retailers and consumer packaged goods companies reacted forcefully to the sudden lockdowns imposed in early 2020. This deserves a lot of recognition; however, the wave of challenges will not stop in 2021. While the pandemic and its implications dominated trade debate throughout the year, a number of well-established disruptive trends continued to unfold, and often even accelerated, until they became main stage.

In 2021 retailers and brands will face the accelerated erosion of their middle-class customers. But, responding with an exclusive focus on affordability will no longer win the battle for retailers. The mindshift among customers is so comprehensive that even cash-strapped consumers recognise the need for change and are trying to add sustainable and ethically-sourced products to their shopping baskets whenever their household budget permits.

These social trends towards more conscious consumption will continue to grow as 'Generation Greta' moves into its prime spending years and replaces the baby boomers in working households. So, the demand for values, a sense of purpose, and meaningful experiences will continue to gain importance. Parallel to this, materialistic lifestyles will continue to decline as consumer awareness of global crises becomes widespread and mainstream. 

This will also create a trend towards more localism as consumers seek to support domestic producers. Retailers will also source more locally in order to protect their supply chains in an increasingly fragmented world with less open borders. This will create opportunities for new, local brands. Meanwhile, consumers will be expected to pay more for high-quality food that is ethically sourced along safer supply chains.

Last but not least, digital transformation will continue to accelerate. This will demand new skills from retailers and brands who must finally recognise the force of online as a new sales channel. Food retailers must review their store portfolios in order to provide omnichannel services. They must make their stores economically viable against a scenario where bricks & mortar sales could decline by up to 10 per cent over the next five years."



Michael Sansolo
Retail Industry Consultant, Washington D.C.:


Michael Sansolo, Retail Industry Consultant (photo: Michael Sansolo)
M. Sansolo
Michael Sansolo: "Cabin fever will create a massive swing back to food away from home"
"In many respects, predictions about 2021 might be easier to make than in the past for one simple reason: Covid-19. If the vaccinations created to battle the virus are successful and quickly distributed world-wide, we face one scenario. If there are any problems in effecting this, we face another. Sadly, these two paths are clear and defined.

Let's start with the nightmare scenario where the vaccine either doesn't work or distribution isn't fully achieved. In that case, we'll see a continuation of the problems we had in 2020 with shoppers unable to return to stores as in the past. In this case, we will continue to see enhanced reliance on internet-based shopping with products reaching homes by delivery or curbside pick-up.

The supermarket industry will continue to record high levels of sales as restaurant eating will remain challenging. However, the rate of sales growth will slow due to simple math. There were enormous growth rates in 2020 compared to 2019 (a normal year), but 2021 and 2020 will have similar conditions. Nonetheless, supermarket sales will remain at historic high levels.

The more optimistic scenario is one where the vaccines work and get wide distribution quickly, perhaps by mid-2021. In that case, we face incredible uncertainty as to whether shoppers will return to old patterns of eating, shopping and cooking or if changes from 2020 become more permanent.

In addition, the global economy still has to cope with the shock of so much commerce grinding to a halt in 2020. As we know from previous downturns, economic issues lead to consumers economizing on a large scale. This should play right into the strengths of extreme value merchants like Aldi, Lidl and all the dollar store varieties.

My prediction in this scenario is mixed. I believe shopping has been permanently changed by 2020 and a large percentage of shoppers will continue to rely on delivery and curbside pick-up simply for the convenience. This will force traditional retailers to create more permanent methods of fulfilling these needs.

However, after nearly a year of being locked at home, I expect a massive swing back to food away from home as shoppers finally get to cope with cabin fever from the lockdowns. In this case, supermarket sales will appear to decline as 2021 will have no way of continuing the Covid-fuelled gains of 2020." 



Jon SpringerExecutive Editor, Winsight Grocery Business, Chicago:

Jon Springer, Executive Editor, Winsight Grocery Business (photo: Winsight Grocery Business)
Winsight Grocery Business
Jon Springer: "Pricing, value and efficiency will come even further to the forefront in 2021"
"Between the global pandemic, widespread social unrest, and irresponsible and counterproductive leadership, 2020 was an incredibly chaotic year in the US. 2021 will be its aftermath.

In food retail, the crippling of the restaurant industry and entertainment services, work-at-home, and school-at-home provided a gift for traditional U.S. supermarkets. They absorbed incredible volume gains, but were largely able to pass on rapidly rising costs.

Supermarkets were also able to gather investment fuel in order to expand both e-commerce and technology in a situation where insufficient capacity was the only limit to further growth. The crisis also tested retailers' crisis readiness.

If and when progress is made in combatting the virus, food retailers will encounter year-on-year gains that will be impossible to surpass. They will also have to face economic impacts – largely hidden from food retail in 2020 – which will probably bring pricing, value and efficiency even further to the forefront. This portends difficult times even for the very best in the business.

We'll see Amazon make further progress in the physical food retailing world, while Walmart and others will make further ventures into the virtual world. They will continue testing and deploying technologies to make businesses more efficient and ones which genuinely support the changing way people shop." 



Dr. Mirko Warschun, Senior Partner & Managing Director, A.T. Kearney GmbH, Munich:


Mirko Warschun, A.T. Kearney (photo: Kearney)
A.T. Kearney
Mirko Warschun: "Social distance will create proximity"
"There's no doubt e-commerce is skyrocketing to dizzying heights — local neighbourhoods will continue to serve people or serve them anew as a mainstay in a world that is becoming increasingly virtual. Local formats will gain further traction as long as they are embedded in social media activities and sell with a positive vibe.

Social distancing will continue to be key — whether for local shopping or at big grocery multiples. Food outlets have come up with a host of creative ideas in recent months: vending machines that offer a shop's entire product range, including fresh fish and meat, fruit & veg, dairy and local specialties, as well as stores that sell at the door or window and restaurants that serve diners in their clients' cars.

Grocers have learned how to leverage their own technology competencies. They have also learned to develop solutions that attract shoppers and awaken their digital curiosity in unstaffed stores. 2020 has proven that social distance shopping is not just limited to non-food e-commerce, but, when paired with real convenience, it also creates a new level of digital experience.

Sustainability is most definitely being taken to the next level. The expanding rollout of reusable packaging systems and advanced circular economy platforms has already opened up new options for consumers this year. These will continue to evolve around a customer-centric supply chain. This development can no longer be held back and will accelerate in 2021.

Despite this, new forms of store usage, such as concession stores, farm-shop concepts and micro-fulfilment centres, can only be realized if retailers and FMCG manufacturers work hand-in-hand."



Bill Webb
Senior Lecturer - Retail Management at The London College of Fashion Business School and Member of the Ebeltoft Group of Retail Experts:


Bill Webb (photo: Bill Webb)
B. Webb
Bill Webb: "Buy less, demand more" (photo: private)
"The retail infrastructure we know today is a legacy of a time, half a century ago, when education and communication had become universal, international travel was ubiquitous, consumers were thought to be homogenous, and strategies based on global mass markets were considered legitimate.

The first two decades of the 21st century had already seen many of these assumptions beginning to be questioned. Covid-19 has transformed the tremor of change into a veritable earthquake. In the words of Duke Ellington 'things ain't what they used to be'.  

2020 has seen a rise in consumer nationalism, especially in China, political protectionism, growing digital engagement, an explosion of environmental awareness and support for minority groups of all kinds.

The forces of fragmentation have been hard at work. Today's consumer has been characterised as focusing on three dimensions — cost, convenience and conscience — yet beneath that lies a complex mesh of consumption drivers, many of which have not previously figured in retailers' strategies or business models.

There are those who want to share, rent or create their own products, or repurpose products — or go without altogether, as well as those who can't wait to get back on the consumption bandwagon. The patterns of consumer demand have been blown apart, both in terms of what is wanted and how it is obtained.

We have witnessed the demise of many retail stalwarts from all over the world. But there are still queues outside Primark, and sales of everything from bicycles and fitness equipment to 'zoom casual' lounge wear, Christmas hampers, health & beauty products or books and online education have all increased exponentially. What algorithm could have predicted that? 

Consumers are confused, disorientated and instinctive. After the Spanish flu epidemic in 1919, who could have foreseen the effervescent 'Roaring 20's'? Despite the plethora of retail forecasts, no-one knows what the retail future will be like. Defining the 'horseless carriage syndrome' in the 1960's, Marshall McLuhan wrote that 'the future mimics the past until it finds a form of its own'. 

I've spent my career as a retail manager and consultant trying to find better ways of doing things. Tomorrow's entrepreneurs will need a different mindset, concentrating on providing vision and leadership in uncertain times and doing things differently, with the support of a talented and agile team. H&M's just announced Singular Society member model imitative is one such example.

In the post-Covid world the role of retailing is likely to be reimagined as more of a facilitator and less of a distributor. Bigger will not necessarily be better. As Patagonia says in their latest mantra 'Buy less, demand more'."



Julian WildPartner, Corporate Finance for Rollits LLP, Hull, UK:

Julian Wild, Partner, Rollits LLP (photo: Rollits)
Rollits
Julian Wild: "The world has become a smaller place"
"The Covid lockdown has shown all us what can be done from home and in particular through home deliveries. Amazon, like it or not, has been a total revelation in how to order something today and get it delivered to your home tomorrow. This may kill the High Street, but it gives consumers what they want without stepping outside the front door.

The service is amazing and will extend significantly into food & drink. My son started a cottage industry in candle-making and orders his raw materials and packaging on a just-in-time basis through Amazon. 

Let me also make a few other points:

Keeping people safe has to be the top priority during the current pandemic. I don't buy into the economy over safety argument;

I'm sure there will be a lot less travel by plane and train and a huge increase in Zoom or Teams callsNot just for the environment but more for efficiency and best use of time, managers will massively reduce the amount of unnecessary travel; 

There will be a greater reluctance to commute and waste a lot of time travelling to offices and factories if employees can work from home. But some jobs can't be done online, and the camaraderie of the workplace shouldn't be underestimated; 

* The pressure to provide more environmentally-friendly packaging and energy solutions will not go away. These will be demanded by consumers and retailers alike. I also think there is greater recognition now that more is often less and that we can survive happily while consuming less; 

* But globalisation is here to stay. Disastrous though Covid-19 has been, the world has become a smaller place."



Clive WoodgerFounder, SCG London:

Clive Woodger, SCG (photo: SCG)
SCG
Clive Woodger: "Life is short. Play more."
"Last year, I noted the rising trend of SOB (Shame of Buying) and the dichotomy of virtue-signalling retailers who promote their sustainability credentials and values in order to encourage ever increasing consumption of stuff we don't really need — whether everyday items or luxury brands. 

By definition, any luxury brand must be suspect when viewed through an essential item lens. However, consumer aspirations still prevail.

The recent Chinese 'Singles Day' sales involved 200 luxury brands like Prada and Balenciaga. We are constantly told that retail, whether off- or online, is about the 'experience' as an intrinsic part of a consumer quality/value judgement. It will be interesting to see how those retailers who survive the pandemic will adapt to new customer expectations of a more ordered, service-orientated shopping experience that the crisis has forced on many retailers.

Covid has turned the consumer world upside down. New government dictates that we should be only buying 'essential items' beg the question: 'What is essential for physical and mental well-being?' The latter allows plenty of leeway. One minute we are encouraged to 'eat out to help out' but lockdowns force us back to isolation. I'm very happy to book ahead, be served at table or have items brought to me rather than the old system of the customer having to do everything.

In an increasingly seamless on- and offline retail world, after overdosing on Zoom and the internet, physical retail could become more of an essential for many people. Perhaps there will be a renewed preference for real human contact as opposed to yet another algorithm. The old cliché 'the customer is king' might be due for a comeback.

Greta Thunberg's demands for us to stop flying and consuming and to go back to the supposed nirvana of a preindustrial age has scarily come about — but not quite as she had imagined.

The nightmares of the global pandemic are combined with a new emerging political world order characterised by an aggressive China that directly opposes concepts of democracy. This creates increasing conundrums for international retailers – but also Chinese entrepreneurs. Jack Ma, the Alibaba founder, has had his wings clipped by the Beijing regime who suspended his Ant Group stock market listing. So, a new political order now controls one of the world's most successful retailers and business entrepreneurs.

Fridays for Future (Sonia Mertens on Pixabay)
Sonia Mertens on Pixabay
Fridays for Future: They seek Greta here, they seek Greta there, they seek Greta everywhere
How do global retailers who are heavily invested in the massive Chinese consumer market preach about their 'values', given their dependence on the People's Republic for their future growth? Volkswagen are now having to defend their manufacturing plant in Xinjiang where government re-education camps are holding over a million Uighurs and other Muslims. Back in 2013, the decision to open the plant appeared to be a simple one for VW — as they said at the time it was purely 'based on economic considerations'.

In hindsight, such a statement seems not only dated but naive in a world where political considerations must be taken into account and where ethical values are of critical importance. However, this has now got to the point where, it seems, that every business, particularly retail, must now be signed up to a 'woke'-based set of business ethics.

Brand advertising must now tick appropriate societal boxes or face so-called 'cancellation'. Shareholder interests nevertheless need to be met in the real world. It is interesting to see how big corporations and international retailers now desperately try to be seen as cuddly, local entrepreneurs, committed to their communities.

Messaging can become reduced to what I call, vacuous values verbiage – in other words it doesn't really say anything. Marketing agencies are now forced to be politically correct and have every communication vetted to avoid upsetting over-sensitive audiences. Where did wit, sharp narrative and a bit of creative cynicism go?

I really miss a memorable classic like the banned Xbox ad 'Life is short. Play more' — surely a universal message we can all relate to in these strange times."



We wish our readers a sustainable, ecological and much better New Year. Let's get the virus done in 2021, and in the meantime #coronaonlyfromthefridge. Cheers!



Lebensmittel Zeitung print and digital (photo: LZ)
LZ
Our German retail B2B newspaper, Lebensmittel Zeitung, in print & digital
Statements introduced and collated by Mike Dawson, international editor,
Lebensmittel Zeitung













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1 Comment (Write a comment)

  1. Matt
    Created 6 January, 2021 17:39 | Permanent link

    The pundits' view

    Firstly, thanks to the whole German Retail Blog team for all the insights — not only in this particular blog post but throughout 2020!

    This time, I think I was most impressed by Clive Woodger's statements. For example, the points he makes about the way governments dictate "what is essential" for a healthy life. (Interestingly, here in my home town of Berlin bookstores are seen as essential, so they have remained open despite the general shutdown of non-food stores.)

    Another good point Clive makes is how big corporations and international retailers now "desperately try to be seen as cuddly, local entrepreneurs".

    Obviously, how we define local and regional remains an unsolved issue. And can the reduction of consumption ever harmonise with a fast-moving consumer goods industry hungry for growth?

    Finally: "Where did wit, sharp narrative and a bit of creative cynicism go?" Well, I'm afraid that trying to appeal to everyone in an increasingly heterogeneous society, while remaining determined not to upset anyone, means that you will inevitably have to lower your standards...

    Thanks for your work, Clive!

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