Monday, October 29, 2018

Track Record of Our Predictions for 2018

Each year, before issuing a set for predictions for the upcoming year, we evaluate how we did with regard to the predictions we made for the current year. Without further ado, here are the results for our 2018 predictions.
  1. Expect to hear about “the retailpocalypse" as a key consumer sector tries to fight Amazonification. Retailpocalypse probably was included in more headlines in 2018 than Amaxonification but pretty much any news story about the retail sector mentioned Amazon. It was a tough year for the sector, with two to three thousand locations closing, and 125-year-old Sears declaring bankruptcy in Q3. Unfortunately, we expect the brick-and-mortar stores to continue to have a tough time of it even as Amazon opens more retail locations. While the bad news for retail has been covered, did not capture the attention of consumers as much as we had expected. We expect that Amazonification will capture more attention in 2019, and the downward cycle continues, and expect calls for “doing something” to protect failing retail. Grade: A.
  2. People will be more anxious and angry. We called this era the Age of Anxiety and Anger, and we got this right. In 2018, we saw lots of anger, much of it political, and lots of anxiety. There were many more references to people needing to take a break from their devices’ notifications. As of Oct., we expect more anger after the midterms — however things turn out — that will carry over into 2019 and people start focusing on the 2020 election cycle. We also expect that people will continue to be more anxious — whether due to politics or not — and that there will be more articles about how to de-stress. From a marketing perspective, look for some consumer brands to try to tap into the need to de-stress.  Grade: A.
  3. There will be a debate about whether or not and how to regulate Facebook, Google and Twitter. We got this totally right, particularly when we said, “Expect Congress to continue to hold hearings on the subject – just don’t expect any agreement on the answers before 2018’s midterm elections.” With concerns about disinformation campaigns and data breaches, and claims of censorship-by-algorithm, expect this debate to continue past the 2020 election cycle. Grade: A+.
  4. The labor shortage and the gig economy will spark think-pieces about the nature of work. The labor shortage and the gig economy did get some coverage but we didn’t see as many think-pieces as we expected. However, there were think-pieces about the potential impact on jobs that robots will have on the nature of work. We expect more coverage of the impact of robots on jobs in 2019, along with calls to better track and understand the gig economy’s impact on the economy at large. Because we expected more essays about the labor shortage than we saw, we will reflect that in our grade. Grade: B+.
  5. Conversations about gender, sexuality and sexual harassment have changed – at least in the media. This was definitely true in 2018. We continued to see a big divide, and lots of anger, and unfortunately, both will continue next year. Grade: A.
Look for our predictions for 2019 before Christmas.

Meanwhile, tell us what you think. 

Thursday, October 25, 2018

Bloomberg Validates Our Concerns That Store Closings Have on Real Estate

For the past year, we've been saying that the retail sector is in trouble, and that the potential impact of Amazonification and the retailpocalypse will be felt in other sectors. 

Our primary concern is that as big box retailers often support local newspaper through ads. So that as an expected 2,500 retail locations shut down through early 2019, there will also be a cut in ad buys in local newspapers. 

That downturn in ad revenue will likely hurt smaller local newspapers.

And that may lead to local newspapers either laying off staff, shifting from a daily to a weekly, or from a weekly to twice-a-month, or shutting down completely.

That could lead to an increase in what are being called new deserts -- communities that don't have access to local news. 

All of that has an impact on PR and marketing because there would be fewer outlets with which to reach key audiences.

But we've also been concerned that the number of store closings will also impact real estate, both at malls and in towns. At malls, we've felt the problem is that if an anchor location remains empty, the entire mail will be written off by consumers. And that precipitates more closings, which becomes a self-fulfilling prophecy that leads to a downward spiral.

In a Bloomberg News article yesterday that was syndicated into a number of papers, including the Boston Globe, "Struggling malls at crossroads as Sears makes exit," reporters Patrick Clark and Justina Vasquez made that same point:

"As Sears shutters stores, landlords will have to overcome the perception that the entire property is failing or risk losing other tenants, said Burt Flickinger, managing director of Strategic Resource Group, a retail-advisory firm."
“You’re going to see an epic hollowing out of the retail malls in America, especially the malls that are co-anchored by Sears” and another struggling large retailer, Flickinger said. “It’s creating an accelerating retail ice age and an economic Armageddon of unprecedented proportions in the US.” 
That's got us worried.

Retail is an important sector for the U.S., and not just to buy things. Retail can a communal activity whereas shopping online is not. And Bloomberg has reported on the negative impact on local towns in the U.K., when shops have closed on main street, and residents then have to drive thirty minutes or more to buy things they once could in their home town. Those towns suffer because there's literarily nothing holding people there.

So, a lot of doom and gloom -- and you don't have to be a big shopper to see that this can affect you. We don't necessarily have a solution. But we feel that raising the issue is important, that discussing this can help lead to awareness. If we ignore the retailopaclypse, it's not going to go away. 

Wednesday, October 17, 2018

6 Cues to Tell Fake News on Social Media from Real News

Hiawatha Bray, the long-time Tech Lab columnist at the Boston Globe, has an interesting article about fake news. Entitled, "Can computers tell if an Internet news story is mostly true or mostly false," Bray's article notes these common features of fake news on the Internet:
  1. Lots of capitalized words or exclamation points.
  2. Use of words denote extreme certainty such as “absolutely” and “always.”
  3. Sentences that tend to be shorter and simpler. (Which makes them easier to read and forward.)
  4. Fewer "love" or "laughter" icon clicks on Facebook. (Real news doesn't usually generate such emotion, apparently.)
  5. The media sites where these articles originated don’t have Wikipedia entries about them. 
  6. These sites, which may be similar to real news sites, have URLs that are long and filled with unusual characters. (Many reliable news sites are much cleaner.)
These are not all 100% accurate; after all the URL for the Globe's article's URL had a lot of unusual characters in it:

We can't wait or rely on algorithms to determine fake news, just as algorithms aren't 100% effective on spam. What we need is for people to take responsibility for what they share. This is important since new reports from the New York Times and others indicate that there will be more disinformation ahead of the midterms next month and ahead of the 2020 campaign. 

Disinformation campaigns at this level (perhaps any level) are anti-democratic, and we need all concerned citizens to take responsibility for what they share. So it's important to be aware of the six indicators for possible fake news.

Monday, October 15, 2018

More Doom & Gloom from the Retailpocalypse

We've been focused on the "Retailpocalypse" for about a year now because we feel so many sectors are affected, including real estate (when stores close and locations may or may not find new tenants), hiring (when tens or hundreds of employees lose their jobs), and local media (who had been relying on ads from those local retailers). 

We came to this topic by way of the impact on local media, which is directly relevant to our business.

Unfortunately, while there are new stores launching each year, and other retailers may be expanding, there seem to be more retailers shutting down locations or declaring bankruptcy. The latest is Sears, the 125-year-old retail pioneer, which on Monday filed for bankruptcy and said it will close 142 more stores. That's on top of the 46 locations it announced it was closing back in August.

The company, which also owns Kmart, will have 687 Sears and Kmart locations remaining. The company owed $134 million of debt that it could not pay.

At its height, Sears was the known as the "the everything store" and was the largest retailer in the U.S. In 2006, it had 355,000 employees; today, it has fewer than 140,000 employees.

One reason Sears is failing is because of Amazon. It's ironic that Sears, which started as a catalog business, has lost out to Amazon. Amazon is now "the everything store."

For more on Sears' legacy, check out this NPR story.

The retailpocalypse is not ending anytime soon, and will continue to have a significant trickle-down impact on a range of sectors in the U.S. economy. We don't know if there's a solution exactly, and certainly don't see how government could step in (other than to break up Amazon, which isn't necessarily a good idea). But the health of the retail sector is one that needs to attention paid to it. As we prepare our predictions for trends in 2019, the retailpocalypse will continue to be on our list.