People are generally surprised that SkyMall, the catalog, is going into bankruptcy. It seems like almost every passenger flips through the quirky ads at least once during a flight. They may flip, but they do not buy. A SkyMall head says they are succumbing to a “crowded, rapidly evolving, and intensely competitive retail environment” (WSJ, 1/24/2015).
SkyMall, a twenty five year old company, came of age with the Baby Boomers. Now it is going down with them. Massive changes in retailing are occurring. For those Baby Boomers who plan to age-in-place, the familiar stores and shopping haunts will be changing. And, ironically, the Baby Boomers are part of the demographic spearheading that change.
In shorter blogs, we have posted images of decaying mega malls, asphalted parking lots sprouting weeds through the pavement, and abandoned store-fronts. Are these just carefully selected photos, arranged to support a point of view, or are they indicative of a larger trend? And, even if real, does it matter to people who choose to age-in-place?
In “Aging in Suburbia” we make the point that aging Baby Boomers will find themselves growing old in suburbs that are greatly changed. This is aging in place with change. Some chains that were fixtures of malls and shopping centers are now defunct, or grappling to stay afloat: for example Borders, Barnes and Noble book sellers, electronic giants like Circuit City and Best Buy, and department store anchors, like JC Penney and Sears. Sears and JC Penny have been closing select sites, and ceased from building new ones.
Successful retailers who market to Millennials, like Ikea, have publicly stated that they plan to expand their online operations, rather than physical stores. Meanwhile, existing sites that close are repurposed. Malls that used to have big box stores are being repurposed, sometimes as data centers for massive banks of computer servers and network routers. As they do so, everything around them changes. One data farm might hire about 10 people to work in an 11,000 square foot space. A previous retail tenant might have employed about 90 full and part time employees.
For older people, the data farm nearby may not be so onerous, as long as home delivery continues to grow and prosper. Home delivery provides multiple benefits for a population that will be less able to drive. It provides shopping access, when people can drive, but choose not to, because it is hard to manage walking through football-field sized stores.
Online ordering is also a safe alternative, when the weather is poor and the roads are slippery. Even in the best weather, older drivers may weigh the risks of taking the car out, and getting into a fender-bender at the mall, vis a vis the convenience and ease of ordering online. And then, home delivery means you get to sidestep most of the heavy lifting – moving boxes or groceries from shopping cart to checkout, from checkout to car, from car to doorstep. If people get sick and have to stay at home- groceries and prescription drugs are as likely to show up at the doorstep, as flowers.
As in-store shopping gets “iffier” for an aging population, home delivery will be ramping up. Today, home shopping can compete with in store purchases in major cities, with the instant-gratification of same-day delivery. The logistics for making deliveries faster and more reliable are built on travel and scheduling algorithms. There are economies of scale as more users, i.e., homes, require home-delivery and integrate package drop-offs.
Looking into the future, Baby Boomers will order more online, because they need to. And, the Millenials will order more online, because they like to. When customers no longer buy from the SkyMall catalog, and find that they can browse better on electronic devices, brick and mortar stores will evolve into newer channels.
In an earlier time, Baby Boomers, particularly, Baby Boomer women, were proud to announce that they, and their offspring, were “Born to Shop.” Boomers are, and will continue to be, a major demographic and purchasing force. But, if they were born to shop, less of that will be in physical stores and airplane catalogs, and more of that will be online.