How Can Retailers Adapt To The 15-Minute City Trend? (Podcast)

• Published date: 14 December 2021
• Subject Matter: Corporate/Commercial Law, Environment, Consumer Protection, Real Estate and Construction, Corporate and Company Law, Environmental Law, Consumer Law, Real Estate
• Law Firm: Gowling WLG
• Author: Mr Chris Hunt

The COVID-19 pandemic has accelerated numerous consumer trends, notably an increased focus on buying locally and the concept of a 15-minute city, where everything you need is just 15 minutes away. What challenges does this present for retailers, both in terms of their online offering and brick and mortar stores?

In this podcast, our head of retail, Chris Hunt, talks to cosmetics company Lush's customer experience specialist Katie Nugent and Dr Tamira King, senior lecturer for strategic marketing and sales at Cranfield University, to discuss the future of the retail sector after the pandemic and how retailers can adapt to the trends that everyone's talking about.

self

Transcript

Chris Hunt: Hello and thank you very much indeed for joining us for this Gowling WLG podcast. We are an international law firm working in major sectors, including energy, life sciences, infrastructure, financial services, real estate technology, and retail. Make sure you subscribe to receive our latest podcast episodes and visit our website Gowlingwlg.com for all our latest insights.

My name is Chris Hunt and I'm head of the retail sector at Gowling WLG.

In this special one-off podcast, we'll be exploring how consumer trends accelerated and encouraged by the pandemic have meant challenges for retailers in terms of their online offer, bricks and mortar, the refocus on local and the growth in 15-minute neighbourhoods.

We'll be discussing all this and more with two retail experts. You'll hear from Katie Nugent, who is from the global support team at British cosmetics retailer, Lush and Dr Tamira King, senior lecturer for strategic marketing and sales at Cranfield university.

Chris: So, a very warm welcome to both of you.

Tamira King: Hi.

Katie Nugent: Hello. Morning, thank you so much for having us.

Chris: Pleasure. I thought we'd kick off this very interesting subject by touching firstly on your differing perspectives to our central question, which is how can retailers adapt to pandemic induced to consumer behaviour and the increase in buying local, which is a subject I think in retail terms is very dear to most people's hearts. So perhaps Katie, if I could kick off with you.

Katie: I will kick off by saying first and foremost, we sell, so at Lush we sell fresh handmade cosmetics. So, the change in habit towards buying locally, buying more often suits our business model quite nicely. We were inspired by fresh fruit and vegetable markets when the company first started out and the products are still made freshly by hand.

We want our customers to enjoy them fresh. So, somebody kind of popping along to their local shop to pick up their skin care routine in the same way as you would pop along to your local bakery to pick up your, your bread and what you need for the next kind of couple of days is actually great.

And we love to see our customers shopping in that way. So that part is, has really lent itself well to the way that we operate. Having said that, obviously we've got such a kind of diverse property portfolio. We've got shops that are in more kind of local locations, as well as the more kind of central city centre, touristic locations you would expect around the world.

Which, we still see as playing such a huge part in our brand and in the future of retail as real kind of destinations that people still are and still will go out of their way to come and visit for that full retail experience.

Chris: Excellent, thank you. Tamira, same question to you.

Tamira: So, I was just reflecting while Katie was talking about how, during the pandemic and people had to stay at home, people rediscovered their local shops and the breadth of services and the products that they had to offer. And in many instances how those local shops kept their local community going. They had so much to offer in being part of enabling people, to be part of a community, reduce the loneliness and the impact that COVID had.

So, I think the interest and the people that related to their local stores and the interest in them is here to stay. But I also want to reflect on the changing consumer confidence of online shopping since the pandemic. And I think smaller retailers and local retailers are going to have to also build in their online presence. Be aware that people might pop in one day and then shop online the next and try and marry up those customer journeys and to help consumers depending on how they're shopping and where they're shopping and whichever device they may be using.

Chris: Very interesting, thank you. And so, you come at it from similar but different perspectives. And it's perhaps good that we move on to a more of a group discussion between us, because there are some interesting topics that arise out of this. The first I think we probably ought to cover something that's very COVID related. So, since restrictions lifted and we're all glad they, they have in one form or another and people have got back to offices. What are you seeing as the main differences in shopper's behaviour in comparison to where we were before the pandemic, have we seen a sort of acceleration of what was happening before? Have we seen changes happening that are directly as a result and really discuss that because I think we're all interested in that topic.

Katie: I think one of the biggest challenges as we're getting back to that footfall return into the high street, into our shopping malls has been that kind of unpredictability in terms of trends. So, the footfall over the last kind of 18 months has been so up and down which makes, rotas for staff, a real challenge in physical retail. And similarly with buying habits and what people are buying. We've seen a real shake up, and I think that's a reflection of how people are spending their time as Tamira was just, was just saying that people are spending more time at home. People are - a lot of people are spending more time on things like self-care and rituals and routines.

And that's why we've seen, one of our kind of most famous categories is bathing items are bath bombs and bubble baths and we've seen these absolutely sky rocket. So, in terms of the trends, we have been keeping an eye on that so that our managers are in a good position to be able to, anticipate and be there for our customers, whether that's staffing wise or having the right products there.

And then in terms of how customers are responding to being back out for the most part, people are just delighted to be back in shops, able to have that, that social experience, having a chat with someone, being able to pick up a product and smell it, try it on your hands. Again, coming from beauty and cosmetics, its such a tactile thing, right?

So, when you're shopping. For a fragrance, you want to be able to smell it. You want to be able to wear it before you're committed to buy. If you're shopping for a new skincare routine, it's so important to be able to have a chat with somebody who can give you that best advice. So, I think we're seeing people really appreciate that hands on experience and that one-to-one service that is just not the same when you're shopping online.

Chris: So, have you seen, would you say you've seen a surge since restrictions are properly lifted and people clearly feel a little freer and a little safer going out into the world? I mentioned to you before we started that my local store, which is in Stratford-Upon-Avon, and even this appears to be extremely busy, not least by certain members of my family, with certain members of my family shopping there. Have you seen a surge in people wanting to, and actually visiting physical stores?

Katie: Yeah, the footfall is picking back up for sure. Obviously, some channels are bouncing back a lot quicker than others. We are seeing the more kind of local high street stores really bounced back, the malls that people can drive to quite easily. Those were the first ones to pick up. And now we are seeing things like our train station stores just ease their way back up to pre pandemic levels. So again, it's having that diversity in places that people can choose to come and shop with Lush, I think it has been really helpful to meet all of those different customer needs.

Chris: And the local nature of it is particularly interesting. Isn't it? Because if people are reluctant to travel and there's a move obviously with ESG and the increase in the price of petrol and diesel, for example, that local point is really interesting. And I know that a number of your stores are very much local and focused, aren't they?

Katie: Yeah. We're looking at capital cities. So, London, Paris, Tokyo, as more of a series of connected, almost villages than before where we might've thought of it as a homogenous, this is London. And we have seen people shopping more in their local stores. So yeah. As an example, I was working in our Wimbledon shop last week. And I was so surprised that so many of the customers who were coming in were known to the team by name, they were recognized as they were coming in. That's such a lovely thing to see.

Chris: Your usual, Madam.

Katie: Yeah. It's so lovely. And I think, people are responding so well to that from a customer perspective. After, the last few years that we've had and that disruption to be able to go into a shop to be remembered, for the last conversation that you had when you last visited to be known by name it's just, it's an incredible thing to be able to bring to the high street.

Chris: Yeah, very powerful. And Tamira, what's your research telling you on a, and work you're doing in this area, telling you on pandemic related trends in this area?

Tamira: Yeah. So, to reflect on Katie's first point about trends, I think there was a lot of research coming out on certain products were real winners in the pandemic. Like you've talked about hygiene products, cleaning products, fresh products were doing really well. And leisure wear, for example, in fashion was doing really well, probably suits, not so much.

So...