EDITORS NOTE: This is the second in a multi-part series – Retail Therapy – that focuses on the past, present, and future of the retail sector. The series will conclude on October 2, 2019, with a live stream panel discussion.
The foundation of modern Western philosophy is based on French philosopher René Descartes’s “Cogito ergo sum” or “I think, therefore, I am.” Some 400 years later, US consumers created the basis for the modern economy, or to put it in terms Descartes would recognize: I shop, therefore I am.
And there is a lot of shopping going in the US with the retail sector employing more than 5 million people and accounting for 6% of GDP. “That’s the largest component of the private sector economy,” according to industry expert and retail veteran Michael Londrigan, a member of the faculty at New York City’s LIM College and a guest on the BBB National Program’s >Better Series podcast. “Fashion alone accounts for more than $250 billion in sales each year.”
Londrigan notes that retail has always been an important part of the US economy. “Back before the department store chains, you had the peddlers and trading posts that were the life-blood of communities. But retail really took off in the 1950s and 1960s with the move to suburbia and the birth of the mall. And the increase in disposable income.”
The size and scope of the retail sector is not the only thing that has changed in the past 50 years, so has the power of the shopper. Where once designers and manufacturers decided what products they would sell, consumers now have more sway over what’s on store shelves and racks than ever.
“Fashion, for example, used to be top-down with designers setting the trends,” explained Londrigan. “Today the trends can come from anywhere. Bottom-up from consumers, top-down from designers, or sideways!”
That consumer empowerment, made possible by technology, is helping to reshape the retail landscape, according to Londrigan. “You have to listen to the consumer. You have to offer excellent customer service. To be successful, the retailers and entrepreneurs really have to understand who their consumer is.”
To listen to the Retail Therapy podcast series, visit the BBB National Program’s Podcast website, listen to your Apple Podcast app, or your favorite streaming platform.