Let’s Get Small – the Upsizing of Convenience drives the Downsizing of Retail Store Size

The global trend is towards convenience and proximity retailing. Projections that super-stores would take over the shopping universe have turned out to be completely wrong. The growth is in Convenience (43% increase over last 10 years), Discounters (33% increase), and online (31% increase). Insofar as our time is the most precious thing and in shortest supply, convenience becomes the commodity most valued by the consumer. Is Lottery penetrating this segment of specialty, branded, and niche stores?

Tom Fender and Toby Desforges both spoke on the global trend towards convenience and proximity retailing. This is a very big, somewhat surprising trend. Projections that super-stores would take over the shopping universe have turned out to be completely wrong. A very funny video from a few years ago dramatized the fear that superstores were on track to gobble up the whole world. Now come to pass is the reality that Hyperstores and SuperStores are actually in decline. The growth is in Convenience (43% increase over last 10 years), Discounters (33% increase), and online (31% increase).

And it’s not the e-commerce channel that is taking the biggest bite of market-share from the Superstores.  It’s smaller stores, convenience stores, niche and specialty stores.  Is Lottery penetrating this segment of specialty, branded, and niche stores?  Wouldn’t the sell for Lottery be more about driving store traffic as opposed to the commission income?  Especially insofar as our time is the most precious thing and in shortest supply, convenience becomes the commodity most valued by the consumer.  With that priority in mind, Convenience chains like 7-Eleven offer great value. And stores like Walmart, Tesco, and Whole Foods are downsizing their stores to deliver more convenience and specialty.  The increasing diversity of options and consumer choice creates opportunity for marketers to provide innovative solutions for the new retail trade styles.  Lottery should fine-tune and tailor its value proposition to meet the needs of these new trade-styles.

The pressure on big-box stores is also coming from the online world. Hundreds of new e-commerce multi-channel and multi-brand e-retailer platforms are emerging to create a highly diverse and fragmented market-place of consumer options. There are the Online Market-places, Brand stores like H&M and Ikea, Online shopping portals like Amazon, Subscription websites, and Niche specialists. It is much less likely than it may have appeared a few years ago that a Walmart or Amazon or Tesco will increase market share to the point of dominance. The market-place of consumer options will continue to grow but it will diversify, further dividing share between more and more channels and options.

Big box superstores are in decline. The question is … How might Lottery define and capitalize on its role in this retail environment that is shifting back to Lottery’s traditional wheelhouse of convenience stores, small neighborhood stores, niche and brand and specialty stores? For one thing, Lottery needs to see itself as a category. Presently, Lottery is often folded into broader product/service groups. We need to enlist a higher level of engagement from our retailers, motivate them to analyze and assess the profitability of Lottery as a stand-alone category.

The founder of Alibaba, Jack Ma, started the consumer-facing Taobao as a market-place platform that enables small retailers to sell services and products online. Struggling to carve out a role for itself in the Chinese consumer market, Taobao launched Tmall.com as a platform for online brand-building, providing a platform for large brands to build their brand. It was widely believed that the logistical challenges of selling online in China would make it impossible for this model to succeed. They needed to think of something different, something dramatic to get attention. So, Taobao invented its own special day for a big sale. Think “Black Friday” and “Cyber Sunday”. They created “Singles Days – November 11” that enabled them to sell $15 billion. That is more than all retailers in the U.S. sold on Black Friday and Cyber Monday combined. DesForges points out that Taobao invented this “Singles Days” with nothing like the massive retailer footprint and brand awareness that Lottery has. How might Lottery leverage its incredible brand and distributional assets to better advantage and create its own marketing/promotional event?

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Synopsis

Français
Voyons petit. L’évolution de la commodité emmène la régression des commerces de détail. Tom Fender et Toby Desforges ont tous deux parlé de la tendance mondiale vers la commodité et le commerce de proximité. Il faut se rendre à l’évidence : les supermarchés et hypermarchés connaissent en réalité un déclin. La croissance se trouve dans la Commodité (43% de progression au cours des 10 dernières années), les Discounters (33% de croissance), ainsi que le commerce en ligne (31% de croissance). Et ce n’est pas le canal du commerce en ligne qui vole la plus grosse part de marché aux grandes surfaces. Ce sont les boutiques plus petites, les supérettes, les boutiques de niche, les points de vente spécialisés. Notre temps étant la ressource la plus précieuse et la plus limitée, la commodité devient l’avantage le plus important pour le consommateur. La loterie doit s’adapter à cette évolution, ajuster avec précision sa proposition de valeur afin de répondre aux besoins de ces nouveaux styles de commerce. Des centaines de nouvelles plateformes de commerce électronique multicanal et de commerçants en ligne multimarques émergent pour créer un marché proposant au consommateur une offre extrêmement diverse et fragmentée. Il existe les marchés en ligne, les marques telles que H&M et Ikea, les portails d’achat en ligne tels qu’Amazon, les sites à abonnement, ainsi que les spécialistes de niches. Le marché des consommateurs ne cessera de se développer, de se diversifier pour proposer toujours plus de canaux et d’options. Les innovateurs se sont toujours retrouvés face au Mur de l’ « Hors de Question ». Toutes les raisons qui font qu’il est hors de question que l’innovation puisse fonctionner
  • Gutenberg a inventé l’imprimerie à une époque où 93 % des gens ne savaient pas lire. Et le manque de librairies signifiait qu’il n’y avait pas de distribution !
  • Edison a inventé l’ampoule électrique alors qu’il n’y avait aucun moyen de fournir l’électricité aux points de consommation.
  • Karl Benz a inventé l’automobile alors que conduire était illégal.
  • Elon Musk s’est entendu dire qu’il était inutile de produire des voitures électriques en masse car il n’existait pas de réseau de bornes pour recharger les batteries.
Dans notre secteur, que pouvons-nous faire pour créer une culture d’optimisme et de motivation irrépressibles afin de passer outre le mur de l’ « Hors de Question » ?
Español
Es hora de empequeñecer: el incremento del comercio de barrio impulsa la reducción del tamaño de los comercios. Tom Fender y Toby DesForges hablaron acerca de la tendencia global hacia el comercio de proximidad. Lo que ocurre, en realidad, es que las grandes superficies están en declive. El crecimiento tiene lugar en tiendas de proximidad (incremento del 43 % durante los 10 últimos años), tiendas con descuento (incremento del 33 %) e Internet (incremento del 31 %). Y no es el canal de comercio electrónico el que está dando el mayor mordisco a la cuota de mercado de las grandes superficies. Son las tiendas más pequeñas, el comercio de proximidad, especializado y de nicho. En tanto que nuestro tiempo es lo más valioso y escaso que tenemos, la conveniencia se convierte en el bien más valorado por el consumidor. La lotería debe ajustar y personalizar su propuesta de valor para satisfacer las necesidades de estos nuevos estilos de comercio. Están surgiendo cientos de nuevas plataformas de comercio electrónico multimarca y multicanal, que crean un mercado sumamente diverso y fragmentado con multitud de opciones para el consumidor. Existen mercados online, tiendas de marcas como H&M e Ikea, portales de compra como Amazon, páginas web bajo suscripción y tiendas de nicho. El mercado de opciones para el consumidor seguirá creciendo, pero también se diversificará, dividiendo aún más la cuota de mercado entre más y más canales y opciones. Los innovadores siempre se han enfrentado a la Muralla del “No se puede”: todas las razones que justifican la falta de innovación.
  • Cuando Gutenberg inventó la imprenta, un 93 % de la población no sabía leer. Y ¡no había librerías, así que tampoco habría distribución!
  • Cuando Edison inventó la bombilla incandescente, no había forma de proporcionar electricidad a los puntos de consumo
  • Cuando Karl Benz inventó el automóvil, conducir era ilegal
  • A Elon Musk le dijeron que no tenía sentido producir en masa un vehículo eléctrico, porque no había redes de alimentación para cargar las baterías
Como sector, ¿qué podemos hacer para crear una cultura de optimismo e impulso irreprimibles para superar la Muralla del “No se puede”?
Deutsch
Downsizing: Das Wachstum der Nachbarschaftsläden führt zu einem Rückgang der großen Einzelhändler. Tom Fender und Toby DesForges haben beide über die weltweite Tendenz hin zu kleinen Geschäften und Nachbarschaftsläden gesprochen. In Wahrheit geht die Nachfrage nach immer größeren Mega-Stores zurück. Die derzeit wachsenden Branchen sind Nachbarschaftsläden (plus 43 % in den letzten 10 Jahren), Discounter (plus 33 %) und Online-Handel (plus 31 %). Und es ist nicht der Online-Handel, der den Mega-Stores den größten Marktanteil wegnimmt, sondern es sind kleinere Läden, Nachbarschaftsläden sowie Nischen- und Spezialgeschäfte. Da unsere Zeit knapp und unser wertvollstes Gut ist, werden Nachbarschaftsläden von Verbrauchern sehr geschätzt. Die Lotteriebranche sollte sein Leistungsversprechen verfeinern und genau auf die Bedürfnisse dieser neuen Einkaufsarten zuschneiden. Es gibt hunderte neue kanalübergreifende und mehrere Marken vertreibende Plattformen für Online-Handel, die einen höchst diversifizierten und fragmentierten Markt von Optionen für Verbraucher schaffen. Es gibt Online-Marktplätze, Markengeschäfte wie H&M und Ikea, Online-Shopping-Portale wie Amazon, Abo-Websites und Nischen-Spezialisten. Der Markt der Verbraucheroptionen wird weiterhin wachsen, sich diversifizieren und den Marktanteil zwischen mehr und mehr Kanälen und Optionen aufteilen. Innovatoren haben seit jeher mit Zweiflern zu kämpfen, die alle Gründe anführen, warum eine Innovation nicht funktionieren wird.
  • Gutenberg erfand den Buchdruck, als 93 % der Menschen nicht lesen konnten. Und keine Buchhandlungen bedeutete, dass es keine Vertriebsmöglichkeit gab!
  • Edison erfand die elektrische Glühlampe, als es keine Möglichkeit gab, Strom an die Verbraucher zu liefern
  • Karl Benz erfand das Automobil, als fahren noch verboten war
  • Elon Musk wurde gesagt, dass es sinnlos ist, ein Elektroauto in Serienfertigung herzustellen, da es kein Netzwerk zum Laden der Batterie gibt
Wie können wir als Branche eine so unverwüstliche Motivation und einen unbändigen Optimismus schaffen, der die Zweiflern in die Schranken verweist?

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