inside the connected local economy
TRANSCRIPT
Steven Jacobs Deputy editor at Street Fight
Inside The Connected Local Economy.
What is local?
small?
Does local mean
nearby?
Does local mean
Stores Delivery Pickup
Marketing services and technology
Back-office
{radio > television > web 2.0
For years, the local economy was driven by changes in media.
Ad-supported techAd-supported media
Stores Delivery Pickup
Back-office{cloud computing > on-demand
Now, the local economy is being driven by changes in commerce.
Marketing services and technology
Ad-supported techAd-supported media
The local economy is the lattice of industries that help us buy and sell in the real-world.
the $42.3 billion spent on ground transportThe local economy is
Source: Bureau of Labor Statistics
the $184.2 billion spent on food/beverage shopsThe local economy is
Source: Bureau of Labor Statistics
Transit and ground passenger transportation
the $189.4 billion spent on accommodationsThe local economy is
Source: Bureau of Labor Statistics
Transit and ground passenger transportation
the $219.8 billion spent on arts and entertainmentThe local economy is
Source: Bureau of Labor Statistics
the $259.5 billion spent on rental/leasing services
Transit and ground passenger transportation
The local economy is
Source: Bureau of Labor Statistics
The local economy is the $493.1 billion spent at restaurants and bars
Source: Bureau of Labor Statistics
Over the past decade a virtual economy has emerged.
has grown at a blistering rate thanks to the web.The virtual economy
$0
$75,000
$150,000
$225,000
$300,000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Ecom
mer
ce re
tail
sale
s (b
illion
s)
Source: Bureau of Labor Statistics
now accounts for 6% of all retail sales.The virtual economy
0%
1.5%
3%
4.5%
6%
$0
$75,000
$150,000
$225,000
$300,000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
perc
ent o
f ret
ail s
ales
via
eco
mm
erce
(in
clud
ing
non-
stor
e)
ecom
mer
ce re
tail
sale
s (b
illion
s)
Source: Bureau of Labor Statistics
has affected industries in different ways.The virtual economy
0.00%
0.75%
1.50%
2.25%
3.00%
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
sporting goods, hobbies, books
clothing stores
car and parts dealers
electronics and appliances
home service
food service
total retail excluding non-store sellersperc
ent o
f tot
al s
ales
via
eco
mm
erce
Source: Bureau of Labor Statistics
has decimated the information retail industry.The virtual economy
the decline in single-copy magazine sales
Sing
le c
opy
sale
s
0
30,000
60,000
90,000
120,000
2008 2009 2010 2011 2012 2013 2014
The Atlantic The WeekThe New Yorker The EconomistTime Newsweek
Source: Alliance for Audited Media
The virtual economy
but our relationship with it has change so much
has shrunk the pie for the local businesses.
The brick-and-mortar world has change so little
but our relationship with it has change so much.
1910 2015
“We were promised flying cars,
and instead what we got was 140 characters.”
— Peter Thiel
Behind every place There is a system that manages how people move through it.
shape the way we move.These systems
help us get across town.
public transit
These systems
tell us when it’s time to go home.
buildings
These systems
public transit
help us find places to shop.
buildings
stores
These systems
public transit
let us know when a store is open.
time
buildings
stores
These systems
public transit
help us catch a cab.
taxis time
buildings
stores
These systems
public transit
make our cities work.
taxis
workcities
These systems
public transit
timestores
Together, the systems form the foundation of the local economy
As these systems come online the way we move through the world changes.
The connected local economy is reinventing our relationship with the store
workcitiespublic transit
taxis timestores
$450.00
$900.00
$1,350.00
$1,800.00
2012 2013 2014 2015 2016 2017
Non-web-influenced-offline sales Web-influenced offline sales Online sales
Source: eMarketer
a function of the webThe store is now
Foot
traf
fic (m
illion
s)
0
850
1,700
2,550
3,400
Offl
ine
reta
il sp
endi
ng (b
illion
s)
$2,775.00
$2,850.00
$2,925.00
$3,000.00
2012 2013 2014
Foot traffic Offline retail spending
Source: WSJ, eMarketer
more productive as ecommerce has grownThe store is now
18-29 years
30-40 years
50-64 years
65+ years
0% 25% 50% 75% 100%
18-29 years
More young shoppers say that mobile has led them to shop in stores more frequently — not less
87% of millennials now shop the same more in stores because of mobile
Source: Gallup
being used differently thanks to mobile The store is now
0%
15%
30%
45%
60%
Inspiration Research Purchase Post Purchase
Percentage of shoppers who search on mobile and used the store during phase of purchase cycle
Source: Google IPSOS
a fulfillment center for mobile buyingThe store is now
In order to compete the local economy needs to reinvent its information infrastructure
1 Commerce — not media — is driving innovation in local.
The virtual economy was the first application of connectivity — not the only one.2
The story of “local” today is the story of the connectivity reinventing the information systems that govern the way we move through the world.33
