I, some­what exas­per­at­edly, said, “Who the hell is going to buy all this stuff?”

Our town’s pop­u­la­tion is only 120,000 but we seem to have a huge over­ca­pac­ity of retail space, with more going up all the time, thanks in part to a devel­op­ment hun­gry First Nations band with plenty of avail­able real estate.

Mikey replied, “Well, the town isn’t get­ting any smaller and peo­ple need to shop somewhere.”

That, and a recent arti­cle by Medi­a­Post reporter Lau­rie Sul­li­van, got me think­ing. Do we? I mean, do we need to shop “some­where” as in a phys­i­cal store location.

I paused, and then replied, “I’m not so sure. I buy a lot more things online.”

“Really?”

“Really.”

A few days later, I was in a pre­sen­ta­tion where some­one showed dig­i­tal mar­ket­ing growth pro­jec­tions for local adver­tis­ers on a slide. The growth over the next few years was rel­a­tively mod­er­ate – about 5 to 6% year over year. This despite the fact that the cur­rent pen­e­tra­tion rates were well short of 50%.

Put it all together and I can’t help won­der­ing whether we, col­lec­tively, are “sand­bag­ging” our local dig­i­tal growth poten­tial. Mod­est growth pro­jec­tions assume fairly lin­ear trends in the future. We use past adop­tion and extrap­o­late these into the future. Sta­tis­ti­cally, it’s prob­a­bly the ratio­nal thing to do, but what it doesn’t take into account is a dra­matic shift in behav­ior. For exam­ple, what if we’ve reach­ing a tip­ping point where, as Sul­li­van notes, it’s just a lot eas­ier to shop online than to actu­ally hop in your car, drive across town and then try to nav­i­gate through a 25,000 square foot mas­sive retail location?

That’s the way things tend to go in real life. We don’t incre­men­tally change behav­iors, we change en mass. And when we do, we trig­ger mas­sive waves of change that decon­struct and recon­struct the mar­ket­place. I sus­pect we’re get­ting close to that tip­ping point.

Per­son­ally I, like Ms. Sul­li­van, find the phys­i­cal act of shop­ping a royal pain in the tuc­cus.  Recently, my wife and I decided to go buy some coast­ers, those lit­tle squares that go under cups on your cof­fee table. Indi­ana Jones has embarked on less daunt­ing quests. When we finally found them I reckon that, account­ing for my wife and my time at fair mar­ket value, those coast­ers cost some­where around a thou­sand dol­lars. All this for a six dol­lar set of coast­ers that I don’t even par­tic­u­larly like (don’t tell my wife)!

We’re to the point now where shop­ping should be pain­less – a search, click and buy, then relax and wait for FedEx to deliver. Even local shop­ping can become mas­sively more effi­cient through mobile tech­nol­ogy. At some point, we have to real­ize that going to huge retail stores that are built to max­i­mize per visit sales rather than enable you to find what you’re look­ing for is a hor­ri­bly inef­fi­cient use of our time. And when we do, the cur­rent retail par­a­digm is flipped on its pointy lit­tle head. The net impact? Those mod­est growth curves sud­denly shoot for the sky!

And all those big box stores that Mikey and I drove by?

Per­haps bowl­ing will make a sud­den come­back. I know sev­eral great loca­tions for an alley.

Orig­i­nally pub­lished in Mediapost’s Search Insider Novem­ber 3, 2011


Biography / Resume : Gord Hotchkiss is the founder and senior vice president of Enquiro, now part of Mediative. He is renowned in the industry for his expertise when it comes to understanding online user and search behaviour. He and the Enquiro team have built a solid reputation for being the leading experts when it comes to understanding what happens on a search portal and why. Before Enquiro, Gord was chairman and director of SEMPO (The Search Engine Marketing Professional Organization), he worked as a columnist for MediaPost and Search Engine Land, and he was a regular speaker at industry conferences and events. Gord is also the author of The BuyerSphere Project: How Business Buys from Business in a digital marketplace.