January 17, 2005
Did you know that there are four people employed at Tesco to track planning, new suburban developments and the future motorway network? These people are watching, plotting and imagining the shopping landscape of 2015.They are concerned about where we will live and how we will get around. Will the new suburbs be grafted onto existing towns or will they be stand-alone affairs, located somewhere on a proposed motorway intersection, ring-road or flyover? And a host of other questions.
For the rest of us, these questions may not be critically important but are absorbing nonetheless. For a retailer, these trends are crucial. And given the amount of money talked about in the past ten days involving Ikea and Superquinn alone, the new suburbs are likely to be the scene of the most ferocious competition for our hearts, minds and wallets.
It is far from clear how many large shops will remain. For example, when Ikea moves into Ballymun, what will be its catchment area? Given that Irish people travel regularly to Ikea in Scotland and Liverpool, it is fair to assume that Ballymun’s Ikea will have an impact over the length and breadth of the country.
And what of the new buyers of Superquinn? Are they buying a supermarket chain with a local brand and culture or do they really want to get their hands on a highly valuable property portfolio? And what about the new kids on the Irish block, the German retailers? Will their surge continue? Their next move will be decisive. They are already advertising for sites all around this country. Clearly, they want to be everywhere. Who are their targets: Dunnes people, the Spar generation, or both?
As well as telling us whether we are Dunnes people or the Spar generation, the location of these new shops tells us much about how and where we will live in the future.
According to present trends, more than half the country’s population will live in the greater Dublin area by 2035. By then, we will be an unambiguously suburban nation. This is unusual by European standards, but not by American.
Almost 50 of the United States’ 280 metropolitan areas grew faster than Greater Dublin in the 1990s.Some of this development in the US has stalled in the past few years, but it has continued at great pace here. Mass suburbanisation implies that traffic congestion will get worse. As a result of mass outer suburbanisation, Ireland is now the most car reliant nation on earth. In the most extensively cited report ï¿½ the Transport Investment and Economic Development by David Banister and Joseph Berechman – the authors contend that we drive more than 24,000 km per year compared to the US average of 19,000km.
A recent survey of people’s attitudes to shopping by Amï¿½rach consulting reveals that 42 per cent of us rank convenience as the most important factor in choosing a supermarket as opposed to only 28 per cent for whom price is the dominant reason and only 5 per cent who believe that the quality of the produce on the shelves is the decisive factor.
So we shop where we can park, where we can get in and out of easily. We shop where we can back our SUVs almost into the supermarket to load up. We shop where the aisles are wide, easy to navigate and where the check-out queues are short. If we live in the suburbs – and an increasing number of us do ï¿½ this means we want to shop in big, car-friendly multiplexes. This increases car dependency, reduces the reliance on public transport, increases the likely floor size of future supermarkets and reinforces the suburbanisation of the country.
While shopping trends point to where and how we will live in the future, shopping behaviour reveals fascinating other developments. Hard as it is to believe, according to the Central Statistics Office, food prices have not risen here for 18 months. There appears to be competition between all the big stores in basic food items and for our part – while convenience dominates – our tolerance of price rip-offs is decreasing. Again, data from Amï¿½rach shows that 30 per cent of us regularly swap brands because another is on special offer, while one in three buys larger quantities if there is a ï¿½buy-one-get-one-free’ (bogof) offer. In addition, 25 per cent of us regularly use store cards and vouchers.
This price sensitivity, together with the success of the German discounters, indicates that our shopping is split between two distinct types of experience. This dichotomy is best summed up by the following quote from a housewife aired at a recent retailing conference in Dublin: ï¿½I’d rather shop the whole year in Aldi, than give up my skiing holiday each year.ï¿½ So she doesn’t particularly like shopping in Aldi but she will economise on basics, in order to splash out on luxuries. This is the spending pattern of most of us and it explains why, in Ireland, spending on luxury goods is rising four times faster than spending on basics.
In the new classless suburbs of greater Dublin, Cork, Galway or Belfast, how we shop reveals more than almost any sociological indicator. More than political preference, income tax bracket, religious observance, educational achievement or civic involvement, shopping and shopping habits tell you who your neighbour really is. Are they people like us or not?
Take two identical houses, identical lawns, similar garden sheds, comparable company cars. One family wears Hilfiger, spends Sundays in Liffey Valley and can’t wait for the Dundrum shopping centre to open. The other is brandless, goes for walks on Sundays and can’t wait for their Dublin Zoo family membership to be renewed. Despite being in the same socioeconomic bracket, same box-like estate and paying the same bin charges, these families have absolutely nothing in common.
Over the next ten years, as suburbanisation continues apace and the planning laws are mysteriously changed to suit the Ikeas of this world, this tribal behaviour will become more evident. The arrival of Ikea means more huge super-stores are likely to follow. Inevitably this will threaten smaller stores and, if recent history in the US is anything to go by, our shopping will be split into two distinct camps. The first will be shopping for basics done at massive discount big-box shops located in soulless retail parks off the M50. The other will be shopping for ï¿½experiences’ï¿½ in small, over-priced niche outfits which appeal to our sense of ourselves, and who we are, rather than to our wallet and what we earn.
We know what the big-box shops look like. To get an idea of the ambient shopping experience, go to Enniskerry. The small Wicklow village is less a place and more a state of mind. Even the local Spar has a tasteful written sign telling you who the owner is, just to the right of the Spar sign itself. Across the road is the ‘rustic works’ selling rustic home furniture. Up the street you have Murtaghs Food and Wine which advertises “fresh fudge – yes, because you deserve it-; â‚¬20 organic wines, wild smoked salmon” or Jan Russell’s home made sausages.
Over the road, you will find in the Enniskerry Trading Company tasteful ‘hanging angels’ slightly discounted after Christmas while in the appropriately named interior design shop Castles or Cottages the message is, no matter what your income, it’s your sense of good, educated, sophisticated taste that matters. Over the coming years, the Enniskerry state of mind will characterise a certain type of shopper.
Who are you – Ikea or Enniskerry?