The turbulance and in many cases down right crumbling
of the the consumer retail market is not a new problem but has been growing steadily
over the past three decades. Remember, McLeods, Kresgees, Woolworth's
they were the giants in consumer goods in Canada with Robert W. Simpson, Timothy
Eaton and the Hudson's Bay company. The first big disturbance came in
the sixties when retail moved to the suburbs with the baby boomers finding places
to live outside of the core areas of the country's cities.
Woolworth's became Woolco, Kresgees K-Mart and Simpsons,
which had been bought by the US firm Sears in the fifties and Eatons
stayed pretty much in the downtown areas. The market place had changed as the seventies
saw malls springing up where ever you could put a highway and pour out some cheap
The eighties brought us more of the same with big malls getting bigger and shopping
went from being a necessity to a recreation. The problems of over building, over
extending into the market place occurred, but was one of those things that was to
be expected with the free wheelling and difficult to predict trends in urban growth
and the variations in the economy.
Just as the malls saw a shake up of the retail industry the shift in population began
a serious shift in demands and the Hudson's Bay's Zellers was one of
the first in Canada to follow Canadian Tire into rapid expansion to meet these
new demands as the American giant, Wal-Mart moved into Canada.
The mall culture was in trouble long before the consumer spotted it and the first
signs were showing south of the border in the early nineties, but by the late nineties
trouble in retail-land had moved north. K-Mart had no shortage of customers
but its owners and management were tripping all over themselves so that the corporation
left the Canadian market entirely and tried to get itself reorganised in the United
States. Zellers and its parent Hudson's Bay assumed that the demise
of Eatons would fill their stores with customers and Wal-Mart picked
up most of the Woolco locations and began moving from them almost as quickly
into their trademaker isolated, on-your-own stores on urban peripheries. COSCO
came to Canada attempting to out big box Wal-Mart.
The time of the mall was by 1998 in the past. New ones were being unbuilt in favour
of massive shopping centre areas where large retail stores would build close to one
another sharing parking lots and customers. Prince Albert, Saskatoon
both seen these developments that had first appeared in Richmond British
Columbia and now Regina has not one but two of these consumer splash-down
So surely these mega market places are the retailer heaven of the present and future?
No! They are a form of urban blight because they really use up the real estate and
because they require huge volumes of customers, they tend to draw their customers
from formerly viable small towns, smaller cities and even the malls. With lots of
customers they are certain to be successful, well that is what the owners of the
corporations were thinking when they poured billions into their creation and cities
like Regina, Saskatoon and Prince Albert fell all over themselves
with tax concessions to attract these retail outlets. But, the Christmas of 2004
painted a much different picture.
What had happened to the retail spending? The credit card companies and financial
insitutions were reporting record spending by Canadians this past Christmas while
the retailers big and small were reporting moderate increases and in many cases declines.
Many have wondered that it is just the agricultural income problem that forced Zeller's
to close its outlets here in Tisdale and Weyburn but the crop around
Swift Current was just fine and the oil patch in that area is booming yet
Zellers is closing its Swift Current outlet. SAAN has been bought
out by one of those vulture companies that buys up businesses of any kind then guts
them for immediate cash and sometimes tax dodges, the real issuse, what was the problem
that brought SAAN to the decision to sell out the company cutters.
The world of marketing, the world of economics and the world of consumer demand has
one and only one constant and that constant is change. If you are not moving, innovating
and researching new possibilities you are a part of history, not of the future. In
1998 I visited every business in Tisdale, Melfort and Nipawin,
I talked to them about the Internet and what possibilities it would bring, only one
car dealership I talked to understood the message and established a web site and
of all those businesses, I was totally rejected. I don't believe it was because I
was a bad salesman, but because I was talking about the future and the retailers
I was talking to, were living and selling in the past.
Most of you who read this web site will have noticed that each Christmas I have done
a series of stories advocating local shopping and done features on all the businesses
in Tisdale. After my lack of success in 1998 I had decided that I would not
seek advertising to support this web site and would not accept advertising. I am
preased with that decision but doing free stories on retail outlets who often were
hostile to me and my work seemed more than I should endure and after the days and
nights I put in making businesses in Tisdale look good on my site for the
2003 Christmas I was thanked by two business owners, no e-mail thank yous, no thank
you cards and not even responses from those whom I handed out printed copies of the
stories and pictures. These folks don't care, so this year (2004) I did nothing.
I am not just complaining in a pouting rant, I want you to understand that the retail
consumer goods businesses, even on the small and local scale, have it wrong. So.
. . . where did the consumer spending go in the Christmas of 2004?
In our family, we try to keep our Christmas spending reasonable and meaningful and
it was a shock to discover that like the national average, we as a family, also spent
almost twice what we did in 2003 on Christmas. My wife and I had done all of our
shopping here in Tisdale both years, well that is what we thought until we
started looking closer at the purchases. More than half of the money we spent and
this was true of our sons and two daughter-in-laws, went to the Internet marketplace.
One of our sons spent $120 buying music gift certificates for his cousins and friends
from the new Apple iTunes store. I know we are not the only ones to do this,
one friend bought all of his gifts this year either directly from the Internet or
by doing his shopping and selection online then ordering the goods from online or
mail order retail outlets.
Things have changed. We haven't charged into the eBay era, we have simply
altered our consumer patterns. We now have the ability to shop and compare, check
the reviews, then find the best price. My gift for my wife was based on a review
from the New York Times camera critic.My brother talked to a shop keeper then
went on line to check out the information before he made his purchase. The malls,
the big box stores, the mega retail parkinglot bonanzas are not part of the purchasing
picture of this time.
Did you see how big the Sears 2004 WishBook was this year? That corporation
knows what is happening and has moved into the new marketplace. Even the fixed base
stores are not ignoring reality. Canadian Tire is, year by year seeing its
online sales rise progressively.
Think about it, would there be any point in opening a music store in 2005 with millions
in sales going to the online MP3 market. Does anyone buy a book at a bookstore
any more, certainly a few do, but Amazon and other online outlets have that
market covered. Just so you can see that not everyone was ignoring this trend, we
stopped selling computers in 1997 when Apple began selling online direct and
if you check the market place, Dell sells most home and business computers
today, all direct sales, not through stores or retailers. The computer industry was
aware of this trend and you can bet the immediate future is not going to see a reversal
in this trend.
The bottom line is that things have changed. The Web and the ability to shop any
time day or night any day of the week and get the information you need, rather than
what a saleman wants to tell you, has changed the way you buy things. Remember that
one car dealership I mentioned that went for a web site, well their sales is now
about 30% in Saskatchewan's cities and not in their local market and a couple of
months ago, they sold a pickup to a man in Toronto who flew out to Saskatoon
got in his truck that had been driven in from Tisdale and he drove home.