A special report in The Economist magazine looks at what it calls the third retail revolution, the digital age, which turns the era of mass production supporting mass consumption, on its head. While store closures ravage the US (which has the world’s largest retail space per head – see IADS Exclusive: what should we do with our stores), parts of Asia are embracing e-commerce. But they are not leapfrogging physical stores but rather developing the new “omnichannel”.

In China, as well as the giants Alibaba and JD.com, Pinduoduo is working on “community group-buy” or “interactive commerce”, in which customers club together to buy products.

Others such as Shopify (LINK to forthcoming CEO meeting) are allowing brands (Direct to Consumer brands) to by-pass giants such as Amazon. Innovations are also taking place in grocery retail where profits are elusive, and consolidations taking place (Suning taking over Carrefour in China).

One of the secrets lies in customer data, thanks to which Pinduoduo again is pioneering “consumer to manufacturer” (C2M). This allows manufacturers to make specialised products directly for consumers cutting out intermediaries, with lower inventory, better margins and reduced waste.

The impact on retail employment is considerable, as the figures show less need for routine retail jobs but a significant increase in “advisory” or “stylist” jobs as well as transport and warehousing jobs.

In conclusion, the article predicts a cleaner future retail model than the one built around mass production and mass consumption, that has been dominant for 150 years. To see something of the future, we need to look at the innovations coming from e-commerce as well as those from concepts such as Showfields (LINK to upcoming New Business Models meeting presentation), for example.

The return of one-to-one commerce 

E-commerce profits may become harder to make 

The rise of the rebel brands 

Independent retailers may choose multiple sales channels 

The importance of omnichannel strategies 

How to know what customers want

Shop assistants and the retail renaissance 

Welcome to democratised retail