- The growth of e-commerce continues
Online spending is increasing constantly. In 2019, e-commerce in Belgium has already reached a market share of around 10%, which could rise to 20% by 2025 if we follow the Anglo-Saxon trend. The impact on ‘brick & mortar’ retail will therefore continue, and even if this direct impact of e-commerce were only 5%, this would amount to no less than 1 million m² of commercial space that could be eliminated in Belgium in the coming years, mainly at poorly located and/or not ‘refurbished’ stores.
- More and more senior citizens
In view of the ageing phenomenon, it is estimated that in 2030 the number of senior citizens (+67 years old) in Belgium will be higher than the number of young people (<18 years old). Given this demographic weight and their purchasing power, which is much greater than that of young people, this objective deserves, in our opinion, a careful assessment of the needs and expectations.
The other major change in recent years has to do with the composition of families. Single-person households are already the largest: they now account for 34% of all households, and it is estimated that this share could rise to 42% by 2070, while single-parent families are also growing in number (currently around 10% of households).
- Improving the customer experience: ‘channel blurring’
A launderette integrated in a bar? Wasbar in Ghent was a pioneer a few years ago. A mainly young audience comes there to do their laundry and enjoy a drink or bite to eat on the spot while waiting. The Wasbar is therefore a forerunner of the channel blurring trend, or commercial hybridisation. The recipe was a bull’s-eye and new Wasbars, based on the same concept, were also opened in other cities.
A characteristic of these mixed concepts that we can see everywhere now, is the focus on customer experience: where retailers used to focus on the products they sold, it is now necessary to understand what the consumer wants, feels and has in mind when he enters the point of sale. With the rise of e-commerce, it is of vital importance to give the consumer a good reason to leave his home. The brands therefore distinguish themselves by a real added value. Our advice: creativity is essential to seduce the customer.
- A new ecological generation
The climate marches of early 2019 have shown that the younger generations are particularly sensitive to today and tomorrow’s environmental challenges. This is reflected in their consumer behaviour: recovery and second-hand use, the rise of the zero-waste movement and ethical fashion … The ethical-ecological aspect can become a distinguishing element in tomorrow’s retail trade.
- Sharing vs. buying
Another reflex of these young generations is to focus more on sharing rather than buying. Today, people rent their evening dresses, prefer AirBNB to a hotel, share a car (e.g. Drivy, Cambio …) and borrow their tools in a tool library (e.g. Tournevie).
Although the main argument is economic, the ecological aspect also plays a role here: sharing resources reduces consumption. In addition, the sense of belonging to a community of like-minded people is reinforced. We are convinced that this subculture will only increase.
- ‘Placemaking’ to give a new life to urban spaces
As the population in cities is growing rapidly, the challenge today is to preserve or redevelop the quality of life. Placemaking, a process of “citizens collectively appropriating public space from its design to its management”, is one of the responses that is increasingly supported by political decision-makers. Placemaking is a joint and inclusive process aimed at the revitalisation of neighbourhoods and public spaces. This is concretely translated into parks that are designed as dance halls, temporary playgrounds on squares, etc.
This urban revival is also leading to a renewed interest in inner-city retailing in order to get closer to customers. After decades of expansion in the periphery, we have seen a reversal of the trend in investment in city centres in recent years, due to large chains that were previously more present in the periphery. We have for example already told you about the exponential development of mini-markets such as Carrefour Express and Proxy Delhaize in the city. Today, even furniture giant IKEA is considering testing a shop concept adapted to the city centre, like in Brussels for example.
- It’s time for a commercial mix …
In view of improving the customer experience, we see great opportunities to strengthen the commercial mix, whether in city centres or shopping centres and other retail parks. In city centres, catering, leisure and culture have always played a fundamental role and were much better able to withstand the more general downturn in trade. Shopping centres now also understand that they need to be more complementary to e-commerce by offering a different, more complete experience. The share of Food & Beverage (F&B) is steadily increasing, to the benefit of all companies. We should also remember that the totally innovative concepts deepen the notion of diversity much further.
- … and a functional mix
In addition to the need for a mix in the retail sector, it is also time to develop concepts and parks in which the commercial function is integrated with various other functions: housing, services, logistics, offices, leisure, service flats, public facilities … We strongly believe in this transversal and systemic approach to such areas. In our opinion, this is the key to balanced and therefore more sustainable development.
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