How working from home is changing consumer behavior

It’s no surprise that one of the biggest disruptors to physical retail has been ecommerce. But let’s not forget working from home.

Lee Peterson, executive vice president of thought leadership and marketing at WD Partners, shared results of a recent survey on the topic during NRF 2022: Retail’s Big Show. During his presentation — “Retail Supernova” was a featured session on January 18 on the StarWind Stage — Peterson wondered aloud why the work-from-home phenomenon wasn’t more widely covered at the event, noting that consumers are now thinking differently, because they’re in a different place.

The WD Partners study, conducted in summer 2021, involved 2,700 consumers in the United States, sticking largely to the “center of the bell curve” demographically. In 2020, 83 percent of those consumers worked from home about 50 percent of the time (65 percent have been required to work from home at some point).

This year, however, 60 percent projected they’d work from home 50 percent of the time, and 40 percent said they’d work from home about 25 percent of the time. But get this: Zero percent said they would go back to an office five days a week. And the impact of that, he said, “is far-reaching.”

With all these workers staying at home, ecommerce is now the preferred method of shopping going forward for 68 percent of respondents; that number was 52 percent in 2020, and less than 30 percent in 2019.

And if these shoppers do visit a physical store in the future, 37 percent of respondents said they’d be most likely to choose “local,” or within a three-mile radius. That’s compared with, for example, 16 percent who said freestanding stores, 16 percent outdoor malls, 16 percent urban/downtown and 11 percent indoor malls.

The question, then, is whether stores are right there, in the neighborhoods where people might want them to be. Retailers now have a captive audience at home, at least 60 percent of the time — and for many, much more than that.

“Are we servicing them?” he asked. “Or did we build some kind of mecca 30 miles from them that they have to drive to, which they don’t want to drive to anymore?”

The survey respondents also gave insight into what they’d like to see locally, opening a multitude of possibilities for retailers. The most popular: local brands, big brands and dark stores, followed by in-home services, showroom stores and pop-ups.

Some brands are already making inroads in these areas. Peterson mentioned, for example, Target’s local stores; Nike’s longstanding community stores and more recent Nike Unite concept; modern-day convenience store Foxtrot; Ulta Beauty’s local focus and recent record-breaking earnings; Express Edit; and the Victoria’s Secret plans to open standalone stores outside of malls. And isn’t that retail’s job, he asked: to go where the customers are?

Peterson closed the talk with homework for the audience, encouraging them to explore the concept of the “15-minute city,” a residential urban concept inspired by scientist Carlos Moreno. The idea is catching on not only in Europe, but also with U.S. developers; everything a person might need is available within a 15-minute walk or bike ride. Retailers must understand what it’s all about, he said, because consumers are going to make it happen.

And as for the title of the talk? A supernova is a large explosion that takes place at the end of a star’s lifecycle, often creating new stars and galaxies — a fitting metaphor, he said, for physical retail. New stars have been born.