Consumers in the global economy have access to a dizzying array of products from around the world. Shoppers find Mexican spring water in Canadian supermarkets and U.S. fashion labels in Kenyan shopping malls. Goods unavailable at brick-and-mortar stores can be ordered online or even virtually via retail ‘teleportation.’
Paradoxically, in this context of unprecedented availability of global brands, many indicators suggest that shoppers increasingly prefer local offerings.
A simple statistic got me thinking about the trending interest in all that is local. According to data from MasterCard Advisors, U.S. small-business retail sales have risen 5.4% this year, outpacing growth in total retail. The trend is more marked in categories like apparel, where small businesses enjoyed significant growth against a declining category.
CNBC reports that property management companies are following the money by actively pursuing locally-owned concepts – reversing a three-decade trend of favoring national tenants. This shift is a win-win for them and their tenants. Shoppers are drawn to the unique merchandise and dining experiences, the easy shopping formats, and more personal service. Local businesses help landlords differentiate their shopping centers from more homogenous big-box-anchored centers and increase foot traffic.
National companies have started to recognize the trend, too. Retailer West Elm now features a curated selection of locally designed merchandise and supports the makers through community events organized by local store managers.
The increased interest in ‘local’ isn’t limited to retailers. In hospitality, Airbnb offers access to quaint, local residences in lieu of the homogeneity of larger chain hotels. And of course, grocery shoppers continue to express strong interest in local food, which is perceived as better quality, better tasting, more sustainable, and commands a price premium.
The desire to buy local is not limited to the U.S. Here are a few interesting examples from around the globe:
In Asia, Trendwatching.com observes that “from Asia, by Asia, for Asia” is the region’s hottest consumption story. Regional tech brand Xiami is consistently outperforming global rivals. In China, luxury shoppers are opting for local fashion brands over the
ubiquitous international labels that have dominated the fashion scene for the last decade.
Entrepreneurs throughout Africa are finding ways to use their understanding of local needs and contexts to outperform global competitors in their market sectors. The Ugandan-based service app Yoza connects customers with entrepreneurs who offer laundry and dry cleaning service in their local neighborhood. Kenyan consumers have flocked to the M-Pesa mobile payment system, which has made the Western models of retail banks and credit cards all but irrelevant.
I tweeted several weeks ago about India’s Dabbawalas, a centuries-old food delivery service that has survived – and thrived – in the face of competition from global tech startups.
And, in New Zealand, half of Kiwi consumers recently said they try to buy local brands, both to support the local economy and because these companies better understand their needs and tastes.
These local-focused entrepreneur stories might be interesting, but why do they matter?
The “buy local” movement is driven by consumers’ relentless search for authentic goods and services. In a world where a consumer can have any good, at any time, purchasing a less-available, local item – be that a shirt, a piece of home decor, or street fare from a food truck vendor – becomes a source of pride and distinction. This tendency toward the local is facilitated by technology, which allows small, entrepreneurial players to launch, market, and scale their businesses with speed and success.
In reflecting on all of this, I can’t help but think that the old adage, “think globally, act locally” is as true as ever. Global brands will do well to think hyper-locally in order to maintain relevance with consumers in a glocal world.