Coronavirus has brought many challenges to small businesses across many different sectors in the U.K. but for me, one of the more interesting positive trends that happened when the lockdown in March occurred, was the temporary trend towards shopping local.
At least in my own local community, with supermarkets requiring significant crowd control and queuing, the convenience of the one-stop-shop we had all become accustomed to was largely eradicated by the virus and grocery shopping became even more of a chore than it is already. Online grocery shopping slot demand went through the roof, both to avoid exposure to the virus and to avoid the annoyance of physical queuing. With stock piling being a problem, certain items were limited to one per shopper with a total item count per shop also being limited. If you are reading from the U.K. you’ll probably have experienced the same necessary evils being implemented and potential experience the same boom in your local shops increasing their stock levels.
As a result, local bakeries, butchers and smaller shops seen something of a boom as people adjusted their shopping habits to ‘shop local’. This wasn’t some grand altruistic gesture but a reflection of the constraints being applied to the supermarkets. The truth is, people are lazy and when the convenience of getting everything from one place is erased, local businesses begin to thrive. People pay for convenience. During the pandemic’s strictest lockdown that meant spending in multiple local business rather than dealing with the perceived risk and cumbersome shopping experience of supermarkets.
Once the restrictions were lifted again. Boom. Everyone forgot about ‘shopping local’, and returned to the convenience of supermarket shopping.
Much has been written about Amazon and it's role in the death of the high street, but that decline has been accelerated by the large supermarkets’ also swallowing it for themselves. They have tactfully positioned themselves as a one stop shop for everything in much the same way that Amazon have done online. To illustrate the point if I take my local Tesco’s for example, lets see what range of goods and service I can potentially buy (as well as my weekly food shop). Most of these have a corresponding brand on the high street that was previously dedicated to that product or service.
It's not just their larger stores that execute this strategy with precision. The smaller express stores are welcomed with open arms as the anchor grocery store that will bring footfall to a local area, and then they compete with the newsagent, off license and smaller confectioner that already exist. It's almost like town planners (and consumers) are completely blind to the damage they cause to existing businesses.
Show me a one stop shop, and I’ll show you a monopolistic business model that requires someone else in the food chain to get squashed, in order for that business to succeed. Not only do these types of businesses attract huge audiences due to them being a single destination for lazy consumers, they also flip the switch by playing both sides of the market.
If you control the platform, and your suppliers rely on you; there’s nothing stopping you from introducing your own product line that competes.
Attract an audience, attract suppliers to bring their own / or build additional audience, screw suppliers by slowly turning that audience into your own customer.
Imagine for a moment, that you are a local business supplying a quality product to Tesco’s here’s one I’ve randomly found. Then take a look at what Tesco’s come in and offer alongside your product. That’s just one example of an own brand product significantly undercutting a local business on both price and quantity, likely through leveraging their own buying power. How do you compete with that without significant marketing spend to illustrate the quality of the product in comparison? Not only that, but you don’t control the positioning on the shelves and slowly, Tesco’s begins to replace the traditional local brands products with more and more of their ‘own’ brand products. Classic bait and switch. They control the shopping experience and largely, the market. What happens when they drive these suppliers out of business altogether? Will prices remain mouth-wateringly low for consumers? It’s not just Tescos, think of any major supermarket and their strategy is pretty much the same.
In a similar vein, Amazon a platform for third parties, but it also sells its own goods. It has used the third parties to get traction / traffic / build an audience, and then over time has bullied them out of the way because they control the shopping experience where they can substitute their own products.
Several merchants have had the Amazon rug pulled out from underneath them overnight, and Amazon running away with the profits. Their seller platform is awash with stories of Amazon shafting people and running them out of business.
In much the same way as we see the erosion of small businesses and out maneuvering happening in supermarkets, do we as consumers not expect some repercussions for continued support of Amazon? We are paying for convenience with gamble of reduced consumer choice down the road. What does their long term strategy look like? Do you reckon it is a bit like the multinational supermarkets? To sell more own brand products and push out smaller players?
From a supplier perspective, one stop shops that have large audiences are a spiders web. They trick you into thinking well I need to be where my customers are until you’re so deeply entangled in their business model that there is no escape.
As of late 2019, average reach for Facebook posts was down by 2.2%, meaning that brands could reasonably expect their posts to be seen by about 5.5% of their Page’s followers, yet publishers still put time and effort into that platform, or think that somehow Instagram is going to gain them more traction. Remember this, these businesses are always looking for ways to flip the switch and turn your customer into theirs.
Facebook have numerous fingers in numerous pies. Pushing out smaller players in specific niches. These suppliers recognise the impact the duopoly has, so why are large newspaper publishers still supporting Facebook with their news content? They are already in the spiders web, if the advertising model of pay to reach an audience had launched too early on, strategically they would not have as many publishers building their audience there. You have to boil the frog slowly to prevent it from jumping out of the pot.
Google started life just providing blue links and traffic to publisher’s websites. Yet they’ve just announced that 7% of search queries globally will be served the answers directly scraped from publishers websites. No one batted an eyelid - the frog is already being boiled alive because. What are you going to do? Block Google from providing you with search traffic? No, instead you are caught between the devil and the deep blue sea.
The most of us talk a good game when it comes to shopping sustainably , supporting local and building our local communities up, but I'd go as far to say - only when its convenient. Whether it’s buying clothes from our local supermarket (then complaining that the high street is dying), or spending hours browsing Facebook marketplace (whilst wondering why independent quality journalism and fake news is thriving) or wondering why our favourite blogs started drying up (because Google reader was shuttered) or celebrating on how quickly Amazon Prime delivered you a new light bulb - the inconvenient truth is that we only have ourselves to blame and the answer lies firmly at our own door. We are our own worst enemy in terms of how we shop and consume content online and who we do it with.
Truely shopping local means making a significant sacrifice of convenience, an ask which is often a stretch to fulfil; but the more we support monopolistic businesses, the more chance as consumers we will have little to no choice in the future.