Of Kings and New Princes
There used to be a Burger King up the block on Fifth Avenue not too far from the textiles showroom buildings in Midtown Manhattan. It is now a Panera Bread.
Maybe it’s an isolated fast food moment, but maybe, just maybe, it’s a pretty good metaphor for the changing of the guard that is becoming increasingly clear, never more so than at the textiles and housewares shows last month.
The Millennials are not only the new kids on the block, they are taking over the block when it comes to how various home industries create product, package, market and ultimately sell to the consuming public.
This was very clear in the designs at textiles market. Virtually every major fashion bedding producer had some brand, program or portion of their showroom dedicated to products geared toward Next Gen consumers.
It was also apparent in technological applications on products. The generation raised on iPods and Nike was being targeted with a barrage of temperature- and moisture-control bedding, performance towels and other items borrowed from Silicon Valley.
In the housewares arena, functionality in cooking products, coffee makers and air control classifications were often directly linked to cutting-edge technology. Products like juicers were booming, reflecting the natural health hot button.
For us Boomers who never quite learned how to go silently into the night, this is all a sobering experience. We are used to being the center of attention ever since the Beatles showed up on Ed Sullivan 50 years ago.
But the Millennials — who are the kids of Boomers for the most part — have the sheer numbers and, increasingly, the sheer buying power to be the dominant demographic consuming group in a very short period of time.
Which is a serious challenge for the home business. While suppliers are trying to address their product needs, retailers are still stumbling around, hoping to figure out how to get these new customers into their stores.
Yes, their stores. While online is growing incredibly fast, it still only represents somewhere around 10% of total retail sales … depending on who is doing the arithmetic.
Unlike in fashion where retailers like H&M, Zara and Uniqlo have figured out formats and formulas to appeal to this demographic, nothing has come along in home with the same model. Target may try to be hip and Macy’s will pipe Jay Z onto its selling floors, but these are still the Millennials’ parents’ stores.
Will a new retail vehicle emerge to cater to this generation? Will an existing retailer go through a radical transformation to become the store of choice for these new shoppers? Or will something else entirely happen to completely turn everything upside down?
Right now, we’re in the middle of it all so it’s hard to say. But as burger joints are increasingly replaced by natural sandwich shops, the change is happening.
The King is dead. Long live the new Princes.