Downtown Retail Part II: The Nexus of Time Pressure, Proximity, Convenience and Customer Service

In recent postings I have detailed how retailers, over the coming five years, will be facing an environment in which shoppers, especially those in the middle-income bracket, will be having fewer discretionary dollars to spend and consequently inclined to give more weight to low price in their purchasing decisions. In this posting I argue that downtown retailers will best handle these trying circumstances if they understand and exploit the nexus of time pressure, proximity, convenience and customer service. Even in an economic environment where price is a leading factor, downtowns and downtown retailers can compete when they offer the time-pressed local shopper the proper convenience and customer service. Time pressure is what is making proximity again a powerful downtown asset.

Time pressure: Americans are more time pressed than ever and this is changing our society in many ways, sometimes subtle, other times not. Major golf outings are down 33%, major cultural centers like the Metropolitan Opera are shortening performances and intermissions to satisfy the modern customer who demands “express entertainment” and health clubs are offering 30-minute “drive-by” workouts for the busy-but buff-body. The most time-pressed group is working mothers with young children. One way these mothers are creating time for themselves is by spending far less time shopping, especially traveling to and from malls. Another is outsourcing food preparation through take out, sit-down and prepared meals. Time pressure is making consumers look for shopping opportunities close to home. It also inclines them to “satisfice,” i.e., to buy merchandise that is “good enough” in terms of quality and/or price, which sometimes makes it easier for downtown merchants with limited assortments to compete.

: Downtowns have always been closer to the typical residential shopper than that super-regional mall, but, as we all know, the allure of the mall with its vast retail selection, sea of parking and low price points has siphoned off downtown customers for decades. Now, time pressure and convenience (and gas prices to fill that gigantic SUV) are making downtown appealing again. Back in the 1970s, people might pile into the car for a 10 a.m. to 3 p.m. day at the mall – it was considered a leisure trip. This is not the case anymore.

: This means making visits quick, easy and, if possible, enjoyable. Time in and out is fast and/or well spent; products are easy to find. But can convenience compete against low prices in an economic crunch? Yes, if the other three factors of Time Pressure, Proximity and Customer Service come into play. Studies show that convenience can often beat price when it comes to household necessities like food and drugstore items. Even Wal-Mart, Home Depot and Sears are experimenting with smaller store formats to speed up the shopper experience – including self-checkouts. Downtown retailers with their intimate size are already there – but don’t hide the milk at the back of the store! Consumers get aggravated when they realize they are being manipulated and are losing precious time. Convenience also means that the entire downtown shopping district is quick and easy to navigate – busy streets are easy to cross, parking is well-marked and available, public toilets are provided and are user-friendly for moms with young children, etc.

Customer Service
: This means providing customers– through personal services — a quick, easy and enjoyable shopping experience. There are numerous ways to achieve this including letting customers shop after hours, knowing their names and their favorite products, sending them birthday cards, providing cappuccinos, offering gift wrapping and delivering their purchases to their homes so they don’t have to carry them around town. Big boxes cannot compete on the same level (or they haven’t tried – yet!).

Downtown merchants can seldom compete on price, but they, alone and organized, can hit home runs on convenience.

For the full report on “The Nexus of Time Pressure, Downtown Proximity, Convenience and Customer Service” visit after May 1, 2008.

This posting was written with the inestimable assistance of Mary Mann.