Between Brexit and coronavirus, 2020 is so far shaping up to be a difficult year for the retail sector. But behind the stockpiling and panic buying, there is a growing trend that could challenge the very way retailers operate.

  • Consumers are becoming more mindful in purchasing decisions
  • 66% of shoppers planning to buy less clothing in 2020
  • Retailers will need to “radically rethink their business model” to resonate with consumers prioritising longevity over newness with services such as rental, aftercare and resale potential solutions
  • Store closures could loom if the trend grows

At the start of the year, in and among the end-of-season Sales, there was a call for ‘no-buy January’ as shoppers refrained from snapping up new clothes or beauty products for the duration of the month.

It was a movement with a small but dedicated following, with hundreds of blogs and vlogs advising shoppers looking to cut down on new purchases on how to get the most out of their existing items. Some even committed to ‘no-buy’ years, while others opted for ‘low-buy’ in a bid to curb their rate of purchases.

The drive to buy less stuff has been growing for some time. Whether it’s spring-cleaning guru Marie Kondo telling us to only buy and keep things that “spark joy” or David Attenborough admonishing our use of plastics, people are becoming increasingly mindful of what they are buying and whether they really need it.

Marie Kondo is encouraging people to declutter

Marie Kondo is encouraging people to declutter

Last year was the worst year on record for UK retail sales – down 0.1% year on year according to the BRC – despite wage growth outpacing inflation over the course of the year. While political upheaval and Brexit uncertainty no doubt played a part, a move away from consumerism may also have been a factor in shoppers tightening their purse strings.

A survey conducted by GlobalData last month found that 66% of consumers plan to buy less clothing in the year ahead, while 50% plan to buy fewer homewares. Of those that plan to buy less clothing, 44% say the motivating factor is “to reduce the amount of unnecessary stuff I buy”.

Snowball effect

WGSN Insight senior editor Laura Saunter says there are a variety of factors that are driving shoppers to adopt a more considered approach to their purchases, which has created a “snowball effect”.

“We are seeing a move towards an ‘anti-excess’ mindset, in which shoppers are turning away from excessive consumption amid greater concern for the environment and growing product fatigue as we reach ‘peak stuff’,” she says. 

“Factors such as the youth climate strike in September 2019, and others like it, are helping to drive this new narrative around consumption, leading consumers to question whether they need more stuff.”

MyWardrobe HQ chair and former Whistles chief executive Jane Shepherdson agrees and says fashion, in particular, has been thrust under the spotlight.

“The impact of fashion in particular on the planet has become mainstream due to, among other things, the Stacey Dooley documentary, Extinction Rebellion and indeed climate change appearing to be more real to people with the storms, flooding and forest fires, so they are starting to consider their choices in a way that they didn’t before,” she says.

“As a part of this, there is a trend towards pre-loved or reusing things. This has always been there, but millennials have claimed it as theirs and it is now seen as cool.”

Gensler global retail practice leader Lara Marrero believes the shift to ‘peak stuff’ among consumers has been driven by social media making the world feel much smaller and more connected, thereby meaning shoppers are looking to buy products that make them feel like they ‘belong’.

“It’s not what a retailer sells, but what they stand for that creates value in the eyes of consumers now – which means your stores aren’t so much about selling; they’re about brand engagement and ensuring your brand aligns with your customers’ values.”

Saunter says this trend is far from a flash in the pan.

“For 2020 and beyond, we will see shoppers increasingly moving beyond simply extending the life-cycle of purchases and actively buying less, supporting brands who encourage them to do so,” she says. “This group is largely driven by millennials and Gen Z, who are craving an antidote to hyper-consumerism.”

Rethinking business models

This is a trend that, while deeply worthy, puts traditional retail in a tricky position. How can a business model that is predicated on selling people more stuff survive if shoppers now see that very interaction as environmentally reckless or morally questionable?

Saunter says that some retailers will need to “radically rethink their business models” to remain relevant in an era where longevity is valued over newness.

Established fashion retailers such as H&M and Urban Outfitters are both developing rental models in a bid to adapt to this growing trend.

Shepherdson, who helped build Topshop into a global fashion powerhouse, is vying to make clothing rental big business as the chair of My Wardrobe HQ.

Jane Shepherdson My Wardorbe HQ

Jane Shepherdson is chair of rental fashion business My Wardorbe HQ

She believes that businesses that “are really engaged with their customer in a very genuine way, attuned to their every whim and prepared to adjust their business model to accommodate it” are the ones that will thrive as anti-consumption sentiment grows among shoppers.

Saunter says retailers need to encourage “responsible consumption of their products”. As well as producing “climate-positive” products, Saunter recommends retailers extend their offer into experiences and services to boost revenue.

She points to Harvey Nichols as a business which has done this well. The retailer has started giving shoppers the option to pay an additional fee at the point of purchase for shoes and handbags to undergo cleaning and conditioning 18 months after the sale.

Marrero agrees that the resale, aftercare and rental are all markets that will become increasingly important for retailers to extend the life-cycle of their products beyond a single generation of customers to two or three – a tactic that she argues will also prove more lucrative for businesses than selling one product one time.

Guilt-free shopping

For some shoppers, a big motivation to buy less stuff is guilt – guilt about the strain our consumption habits are putting on the planet and subsequent anxiety about what to do about it. 

There are a number of opportunities for retailers to act as a conduit between a consumer’s need for a product and desire to feel they have not exacerbated climate change by buying it, GlobalData UK retail research director Patrick O’Brien argues.

“Retailers need to enable shoppers to shop at their stores guilt-free. It’s not necessarily about ensuring that everything is completely recycled, we have to accept that there will be some impact, but they need to ensure the consumer doesn’t feel they are making a bad decision by purchasing,” he says.

“Retailers should give assurance they are doing something around sustainability and the local community, which buying from a retailer will facilitate, and are not simply an organisation hellbent on creating environmental havoc as fast as possible because it is the road to greater profit.”

Some options to facilitate this include: offering shoppers a chance to pay a fee to offset their carbon emission at the point of payment in-store or online; giving shoppers the choice to pay more for ethically and sustainably sourced products; or offering shoppers the ability to scan products in-store to find out information such as where they were sourced and their carbon footprint.

“Retailers should give assurance they are doing something around sustainability and the local community, which buying from a retailer will facilitate, and are not simply an organisation hell bent on creating environmental havoc”

Patrick O’Brien, GlobalData

Retailers can also be seen to align themselves with the anti-consumption movement in a way that resonates with their customers and may, ironically, drive customer loyalty and thereby sales.

Patagonia, Allbirds, Deciem and Lush are all businesses that shuttered stores this Black Friday in a protest against consumerism. Saunter argues that the businesses that are seen to take a stance against rampant consumerism are those that will win an increasingly loyal customer base in the future.

Some newer brands have made their stance on responsible consumerism a big selling point with London-based denim brand Blackhorse Lane Atelier placing a discretionary ban on shoppers buying more than two items at any one time.

Marketing the longevity of products could also be a good tactic to win spend. 

Furniture retailer Heal’s launched a campaign this month called ‘Not all things are created equal’ intended to promote the longevity of its furniture as items that will last and be passed down generations, rather than cheaper alternatives that could break or ended up in landfill after a few years.

O’Brien says retailers could adjust their marketing and brand positioning to “tap into the idea that their products are not only necessary to buy but are going to have some benefit beyond just taking the possession of them”.

Ikea's Lagom campaign

Ikea’s Lagom campaign

He points to Ikea and its Live Lagom (which translates to ‘the right amount’ in Swedish) campaign as an example of a business that has done this well. A study by the retailer found that launching the campaign – which posits that a number of small changes can make a big difference in terms of sustainability – has had a genuine impact on a core group of its customers.

Shoppers who started by buying a single LED lightbulb from the furniture chain, for example, went on to spend money insulating their doors and windows to reduce heat loss, buy energy-efficient household appliances and install programmable thermostats to cut down on energy waste.

It was a tactic that positioned Ikea not merely as a business trying to tout products, but one that could be relied upon to help its customers live a more sustainable and purpose-led existence.

Store closures

These approaches may help mitigate the impact of the anti-excess mindset but a move away from consumerism will undoubtedly hit the retail industry. Marrero says further store closures will be an inevitability as consumer habits change.

“A retailer’s sustainability is all about its profit margins, so reducing your capex in the event that consumer demand means you make less and sell fewer products will be essential,” she says.

Chief executive of Retail Economics Richard Lim concurs: “If there is a shift towards anti-consumerism, there are so many legacy retail businesses that haven’t adapted quickly enough, that will have too many stores, too much space. There will also be those that can’t shift their supply chains to embrace something more sustainable quickly enough to satisfy customer expectations.”

However, O’Brien believes the impact of this trend could be overstated and argues the average consumer is not going to reduce their buying to such a degree that swathes of shops would be financially untenable. 

With many retailers struggling to make a profit in a difficult market, a small reduction in consumption could have devastating impacts for some. But the retailers that align themselves with customers’ concerns and see their business as a tonic to those anxieties – rather than a perpetrator of them – could come out relatively unscathed.