New Zealand's retail scene seems much more healthy than America's.Photo / Dean Purcell
New Zealand's retail scene seems much more healthy than America's.Photo / Dean Purcell
After living in the land of consumerism for the last four and a half years, (that's America in case you were in any doubt ) I have returned to New Zealand to find that in many ways the local retail scene seems much more healthy and vibrant than California's.
During a visit to the busy Westfield St Luke's shopping centre, as we passed through Auckland in July during the school holidays, the place was hopping.
I noticed some new interesting stores had arrived in my absence though the vast majority of retailers there before we left in late 2013, were still there and looking good. I also hear Sylvia Park and Westgate are doing well so it's not just happening in one place.
When I think of our favorite shopping centres in the San Francisco Bay Area such as Bay Street in Emeryville, anchored by the Gap, Banana Republic and Old Navy and smaller, popular shopping areas like Rockridge, Elmwood and Fourth Street, I would often find a retailer had left the area. These were large operators including Lulu Lemon, Crate & Barrel and Pottery Barn.
And in some cases, store fronts were sitting empty for months afterwards.
In the States, an increasing amount of my shopping for the family was being done online with Amazon and other retailers' online channels.
Amazon was an easy source for everything from air mattresses, to makeup, books, games, electronics, even razor blades while my kids' favorite clothes stores, American Eagle, Vans and Eddie Bauer all had well-oiled online delivery systems. With the Bay Area's heavy traffic a major deterrent to getting on the motorway to go to shopping centres, and the speed of delivery of online shopping, it's not so surprising that local shopping destinations were buckling under the pressure.
To me, looking at the New Zealand retail scene with fresh eyes after a few years away, the retail offer in the main city centres and in the suburbs of Auckland and Wellington is a good reminder of what an Amazon-free retail scene looks like.
Now based in Wellington, I am struck by the number of attractive independent, or quasi-independent shops in the busy downtown. You are spoilt for choice in Victoria Street, Cuba Street, Ghuznee or Tory Streets to name a few. Or if it's furnishing you need, there is always the very pleasant Thorndon Quay which has great parking and cafes to help ease the shopping process. What's not to like?
By comparison, going into the town centre of San Francisco was increasingly off -putting, not worth the hassle of coming in from Berkeley, half an hour train's ride away. The homeless problem was very in your face there in downtown San Francisco– my kids just refused to go into the city whereas Wellington city centre is already their favourite retail playground. My 16 year-old shops in Cuba Street during lunchtime from Wellington High.
I talked to Tim Morris, co-founder of retail strategy group, Coriolus Research, who knows the US retail scene well, about my rose-coloured view of the New Zealand retail scene. He agrees that the US traditional malls are struggling thanks to the online offer there – he gave me recent figures from Cushman & Wakefield that mall visits dropped by 50 per cent from 2010-13 to today.
Workers prepare orders for shipment at the Amazon.com Inc. fulfillment centre. Photo / File
He pointed out that it is not as hard to thrive as a retailer in New Zealand. You are not competing with 20 similar competitors who are, as he puts it, "trying to eat your lunch," as happens in the US, but rather with one or two so, so it's easier to do well. He likens it to the "Treasure Island" effect.
Morris is watching with interest, Amazon's plans to open a warehouses in Australia, a major step for Australians and New Zealand consumers.
Morris says in some sense Australia is 20 years behind the US in terms of experiencing the impacts of online retailing led by Amazon, while New Zealand is more like 25 years behind. At a superficial level local retailers may say they provide online retailing but not in any great depth, he says.
For many Kiwis they can't wait til Amazon has more to offer in Australia and therefore to New Zealand but I would caution them that may affect their thriving shopping environment here.
The open question right now is whether an Amazon scale fulfilment warehouse could ever happen for a market of 4.8 million people in NZ, says Morris. Meanwhile to a certain extent, local retailers will remain insulated by these global pressures.
Being a retailer in New Zealand is not easy, says Greg Harford, general manager of public affairs for retail trade association, Retail NZ.
He told me NZ retailers are finding it tough because people can and do shop overseas online for things they want - half New Zealanders' online shopping is being done overseas, he says.
Local retailers, are meanwhile trying to get ahead of the game, offering a polished online service so they don't get squashed by the"Amazon juggernaut" as Morris calls it.
For many Kiwis they can't wait til Amazon has more to offer in Australia and therefore to New Zealand but I would caution them that may affect their thriving shopping environment here which should be valued.
Going to a shopping centre with the kids may not be the highlight of your day but when every few stores is empty with no sign of who might replace it, that really is not a fun experience. Be careful what you wish for and enjoy the retail experience here while you can.
