and here to tell us why this is all happening
melissa Gonzalez, principal at M. G. Two
and founder of the Lioness Group. Good to have
you on the show this friday. Can you break
down the retail trends that you're seeing right now?
Are people shopping african mortar in person more than their
shopping online. You're definitely seeing a correction happening right
? We had an extreme shift to online because that
was the only way in which we could shop as
consumers. We got really adept at doing that.
Um but you have that pent up demand and desire
to be in person to have that tactile experience to
be part of community events. So you are seeing
it come back. There's also products of consideration where
that in person experience is necessary. We still have
a bit to go and mastering fit online. So
you're you're seeing a correction happen really. E commerce
isn't going to go away but it did skew to
an extreme direction just because those were only options.
Yeah. And it's funny because I feel like we
had an interview and I was talking about the nostalgia
of mall culture and it's actually starting to come back
a bit, I think people are out and about
and trying to shop in person, get that experiential
that we always talk about. But my question for
you is if you think that e commerce maybe adapted
a little bit too soon or grew too quickly to
scale to the pandemic, like we've seen across the
board for a lot of pandemic darlings, I think
businesses that have had trouble reading this landscape, what
are your takeaways from how they've adapted and how they
can potentially adapt now that things are changing. You
know, the successful ones are going to be the
ones to understand that as consumers, we're just at
the end of the day we became more fluid in
the way in which we interact across channels and platforms
with brands. So there's not gonna be just 11
cookie cutter answer. We gotta lean in some commerce
. So we have to leave into stores, we
need to lean into great customer experiences and understanding how
we meet them at the moment of intention or interest
and get them what they need. So for the
in store environment, it's those brands and retailers who
have invested in things like flexible fulfillment. But thinking
beyond this is just a transactional moment. How do
we also make this a brand moment? How do
we recognize that this becomes a driver of in store
traffic, right. It's about having the fluidity and
the convenience given to the customer because if you think
about the utility tech, the service for them,
it's really convenient. Right? And so we have
that convenience factor added with tech but they still want
great brand experiences. So it's about marrying the two
, you've also seen a lot of brands evolve over
the past years thinking about their physical retail footprint and
what is the flagship destination? What is the service
hub? So it's also thinking differently about what that
portfolio looks like. And understanding again, how is
it best serving the consumer because at the end of
the day, we sell products to retailers and brands
sell products, but they have to be in service
of the consumer regardless how they're interacting with them.
Yeah. And speaking of being in service with consumers
, we know a lot of these e commerce brands
reigned supreme during the pandemic. I mentioned that term
pandemic darling, I think of companies like amazon huge
Carbonneau and also stitch fix, Where are they sitting
now? What's the status and what are you seeing
unfold? Yeah. So they're having different uh some
similar challenges, some different challenges. So if we
start with an amazon, yes, there's a lot
of news out there about them having a trim down
their warehouse footprint and whether it's 10, you know
, 10 million, 30 million uh square feet.
But what um what again is happening is we had
to ramp up to meet unprecedented demand right for delivery
and then have to re normalize where that's going to
be at. I think the interesting side is on
the amazon as we're talking about brick and mortar is
they've done some tests. Um four star open and
close. They're expanding, amazon go, had some
challenges with whole foods now they're opening new stores for
fashion. So I think they're still finding their footing
to of what physical retail is gonna mean, but
also validate that they continue to recognize its importance in
the customer journey and building that customer relationship with fast
food delivery. Again, I think that was accelerated
from pandemic. People were nervous to go outside,
it felt safer that way. But again, you're
seeing a return to wanting to go in person.
Um and then on the, on the real estate
side, there's a lot of conversations around do these
dark stores have the curb appeal that they should,
Is this what landlords want? They're taking a closer
look about how their zoning. Um those segments where
those stores have been popping up, so whether or
not they'll be able to get past some of those
new zoning restrictions there and then went stitch fit.
You know, they're having challenges with supply chain issues
and and and and inflation and those costs, which
is very real for for brands and retailers that rely
so heavily on delivery, you know, those costs
are going up and it's impacting the bottom line.
How much of this phenomenon do you think has to
do with inflation? Are you thinking that one of
the major contributing factors is the fact that people have
just been cooped up during the pandemic, so they
want to get back out to brick and mortar?
Or does some of this have to do with going
in person to see items and kind of Finding the
bargain comparing deals from one brand or one store to
the next. Yeah, I think it's a little
bit of both. There is some fatigue of just
staring at a screen and that's the only way you
can purchase something and then I think it's category specific
. You know depending what you're looking to solve for
. Sometimes you just really can't feel the confidence to
do that online. You might want to not want
to have to deal with having to deal with returns
, getting your package re re shipping that out going
to ups or wherever you need go for that drop
off. So I think it's a combination. There
is definitely pent up demand. You saw that kind
of out of the gate, you're seeing a little
bit of shift happening when you talk about inflation.
It's not impacting everybody the same way, right?
So those in the lower income bracket, the increase
in cost of gas has a much significant impact than
those who are in the higher income brackets. So
those are staying a bit stronger. Um So it's
it's not one answer fits all, but inflation is
definitely a challenge. Um And then people are reprioritizing
how they're spending money as well. So not every
category that was seeing the strength that they were seeing
through the pandemic is the same categories of seeing it
today, Melissa Gonzalez, Principal at M. G
. Two and founder of the lioness group. Always
good to have you on the show and get that 00:06:21.290 --> insight