Many online retailers are doing the business of their lives during the pandemic. Others are likely to fall by the wayside: The German Retail Association (HDE) fears the end of thousands of shops, with inner-city retailers in particular suffering from the aftermath of Corona. “Everything must Go!” or “Unfortunately, we have to close” – announcements like these are now seen more frequently in the shop windows.
Are shopping streets threatened with long Covid syndrome? Do the cities even have to fear the death of the shopping miles? “That won’t happen. Our inner cities have a future,” says Martin Schnaack. “But only if retailers seize the opportunity for a bold new start instead of nostalgically clinging to obsolete concepts.” With his Munich agency group Avantgarde, founded in 1985, Schnaack wants to play a leading role in reinventing shopping.
He had just finished school when he founded the Munich fashion fair “Avantgarde” for young designers The mirror once described as “Germany’s flashiest fashion fair”. From this developed today’s group of companies with a turnover of around 200 million euros and 700 employees.
Schnaack now runs the business together with Marc Schumacher, who became co-head of the agency group in summer 2021. Schumacher has a doctorate in marketing and has worked at Hugo Boss, Breuninger and Tom Tailor, among others. Most recently, he was Managing Partner at the Liganova Group, which designs and implements brand and shopping experiences. Together, the duo at the helm of the company want to use the structural change in retail to grow.
They used to be a reflection of prosperity, today they have clever, contemporary competition: the idea of the department store has survived. Many are closing, like this branch of Galeria Kaufhof in North Rhine-Westphalia.
(Photo: imago)
“Most of the shops that we see in the city center today will no longer be there in ten years,” says Schumacher. The problems are huge – and go back further than the outbreak of the pandemic. “Stationary retail has been a tense business model for decades: labour-intensive, expensive due to inner-city locations, store expansion and warehousing,” says Schumacher.
The appearance of the e-commerce players did not make it any easier. The stores could not win the competition with online shops of big brands and platforms like Amazon or Zalando. Everything is available on the Internet, around the clock, with little effort. “Digitization has subjected countless industries to massive changes,” says Schumacher. “It doesn’t stop at stationary retail.”
The pandemic acts like a fire accelerator. People who have never shopped before suddenly use the new offers and like them. This has developed an enormous dynamic. A change in behavior that would have taken years without the pandemic was implemented in a very short time. This took several years to adjust to the retail trade.
The consequences can also be seen in the real estate market. “In Hamburg, Berlin and Düsseldorf there are permanent vacancies, even in prime locations,” says Schumacher. “Landlords have to make compromises in many areas, and Munich has long since become a rental market.” Schnaack and Schumacher see this as an opportunity to revitalize the city center as a marketplace. “When we talk about the marketplace today, we automatically think of digital platforms like Amazon or Ebay,” says Schnaack. “The brick-and-mortar trade must recapture this emotionally charged term as quickly as possible.” For him, the marketplace is a place like the Viktualienmarkt: people come not only to shop, but also to exchange ideas.
Examples from the USA and Canada show how shopping arcades are transformed into lively places
Chains shaped the inner cities for years, Zara, H&M, Douglas, who could afford exorbitant rents, the cityscape was monotonous. “In the future, the pedestrian zone will be more diverse and local, there will no longer be many chain stores there,” Schnaack is convinced of. He doesn’t see large vacancies, but cheaper rents. This creates space for service providers and trades, for living and working in the heart of the city and for new entertainment options.
Examples from the USA and Canada showed how shopping arcades and department stores can be transformed into lively places. In addition to shops and restaurants, you will find there, for example, health centers of the local university, e-sports lounges, fitness studios. The department store of the future could look like this: “A small golf course on the roof, a day clinic on the floor below, and a level for old and young people to meet about education,” says Schnaack. “Then there is a floor with a purely Munich offer, where you can find manufactories like that of the baker Julius Brantner.” Local color is important today.
There could be more local and regional goods, more manufacturers and craftsmen in downtown Munich in the future. Things that don’t exist in other cities – like the bread from the baker Julius Brantner.
(Photo: Kathrin Koschitzki)
This type of floor trading offers the chance to break through the algorithm. “We live in a completely optimized, digital world,” says Schumacher. “If you say I don’t want anything, I don’t need anything, I want to be surprised, that’s only possible outside the network.” The unexpected could still be discovered there.
Of course, the city center also remains important for the big brand manufacturers. Good examples are Adidas and Nike with their stores in the center of large cities. “It’s not about selling, it’s about being able to try things on and hold them in my hands, that I can experience a whole brand world,” says Schumacher. “Other brands will do that too.” The shop becomes a showroom – that too is an answer to the question of what the pedestrian zone will look like tomorrow.
Despite new ideas – a lot is still open. With a bit of luck, inner cities will become laboratories in which fresh concepts are tested. And perhaps the wish of many consumers will be fulfilled for more regional goods, but also for the convenience of shopping from the sofa, for proximity to living, work, consumption, entertainment and personal contacts.