It’s all about balance
According to Nielsen data released in the US at the end of 2017, vinyl record stores have achieved more than 1,000 per cent growth in the last decade. Furthermore, while digital music downloads peaked in 2012, physical album sales continue to grow. The same thing has occurred with books. While e-book downloads peaked in 2014, bookstore sales keep growing. In the US, physical media is now outselling digital.
While some say this trend is an antidote to digital overload and rooted in nostalgia, the truth is, the return of these media has much more to do with human psychology and physiology.
As with everything in retail, there are two sides to the coin. On the consumer side, new technology has many benefits, but wholesale change to the exclusion of all else is not something shoppers crave. While we may like the convenience of being able to carry whole record collections in our pockets, we also like collecting the artwork that comes with our favourite album covers and the tactile and audio richness that analog formats provide.
Our physical senses evolve over millennia – not overnight. For consumers there is clearly a time and place for everything.
On the retailer side, we lurch far too easily and too far. When something like digital emerges, practitioners are often their own worst enemies, hastening the demise of traditional products and services and radically altering how they do things, as they strive to adapt to new trends. Moving wholesale away from the old to the new effectively robs shoppers of any alternative, ensuring the new trend becomes the only reality. Until, that is, shoppers and entrepreneurs lead a renaissance.
In a recent article in the AFR about the resurgence of analog technology, Vinyl Destinations manager Mark Mebalds was quoted as saying, “Our sales trebled in 2017”.
In a retail market that is growing annually at close to 3 per cent year-on-year, such rapid growth does not come from following the crowd, especially one that is hell-bent on cost strategies rather than customer experience strategies.
Saving and splurging
The unavoidable fact is this. Retail opportunity has and always will be about the differences between shoppers not the sameness. Sameness is a mass merchant strategy that works for the 20-tonne gorilla that dominates a category.
Even then, the smart ones provide differentiation around the edges, so they don’t become all about cheap price and convenience – attributes that dictate commoditisation, little loyalty and negligible margin elasticity.
The human condition has always sought balance. When work is stressful, we seek revitalisation. When life seems a bit boring, we seek stimulation. And when convenient shopping and low prices are over-saturated, we seek value-added experiences and products that give us more.
The money we save on cheap, everyday items we willingly splurge on things that make us feel special. The great record stores and bookshops that are prospering when other categories are complaining show where we should be looking for future retail prosperity.
Find the opportunities to connect with customers that are willing to pay more for what gives them more, and give it to them
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