Retail expert Joel Bines on the rise of the “me-centric” economy
From the rise of e-commerce to the arrival of smartphones and the advancements of AI, retail has come a long way from the heyday of brick-and-mortar stores. But the real revolution has been with the consumer.
Throughout its history, retail has been punctuated by a great deal of technological advancements, and many have been quick to call each a revolution. But what’s revolutionary isn’t the underlying tech or the medium – it’s the power shift. Before, merchants chose the products and decided where to sell them and how much to charge. Consumers never really had much power. Now, access to information and to each other has led them to take control of the narrative and rewrite the rules of the game.
In his latest book, The Metail Economy: Six Strategies for Transforming Your Business to Thrive in the Me-Centric Consumer Revolution, Joel Bines, a retail industry expert with over 30 years of experience, talks about that very phenomenon and how, to be successful in the Metail economy, businesses must think of consumers not as a stale demographic with static interests, but as a multitude of individual Me’s with different needs and desires. For the first time in history, we’re empowered to take charge of our needs. Now it’s up to businesses to meet them.
In today’s episode, we’ve caught up with Joel to talk about the me-centric revolution and what that means for retail.
If you’re short on time, here are a few quick takeaways:
- With the rise of technology and online communities, consumers started exhibiting different preferences simultaneously, making it difficult for marketers to target them effectively.
- The six Cs – cost, convenience, category expertise, curation, community, and customization – are like ingredients to help businesses build meaningful relationships with customers.
- Whatever combination you end up trying, you need to walk the walk. You can’t compete as a cost retailer, for example, and not be the least costly place for consumers to get your product.
- Finally, your Cs aren’t something you get off a brainstorming session in a conference room – they should always come from the customers. What are they telling you they want?
Make sure you don’t miss any highlights by following Inside Intercom on Apple Podcasts, Spotify, YouTube, or grabbing the RSS feed in your player of choice. What follows is a lightly edited transcript of the episode.
A revolutionary power shift
Liam Geraghty: Joel, welcome to Inside Intercom. Thank you so much for joining me today.
Joel Bines: Thanks, Liam. It’s my pleasure to be here. I really appreciate you having me on.
Liam: Before we get into the weeds of what we’re going to talk about, could you give us a sense of your journey up until this point?
Joel: Oh my goodness. How much time do you have? In the US context, I’m sort of what you call a blue-collar kid. I grew up basically taking summer jobs and jobs between school years and so forth. I gravitated towards retail in my teens and kind of grew up in stores after I graduated from a small liberal arts college in Maine called Bates College. I fell into retail on the advising side, wound my way through a couple of troubled companies, and found that I was very interested in the sorts of problems that troubled companies had. I had a little bit of a knack for helping turn those companies around.
“I think the word revolution is overused. Most things that people call revolutions are really just evolutions”
Then, I went off to business school, and after business school, I met one of the legends of the turnaround space – a guy named Jay Alix, who had a consulting firm called AlixPartners. I joined, stayed there for almost 20 years, and just retired at the end of 2022. Now, I’m running a small advisory firm, Spruce Advisory, where I can serve clients. I spend a lot of time writing – I’m working on a second book – and a lot of time speaking and mentoring. That’s the journey.
Liam: That’s great. The whole shebang. Today, we’re going to be talking about this fabulous book that you’ve written, The Metail Economy: Six Strategies for Transforming Your Business to Thrive in the Me-Centric Consumer Revolution. There’s a lot to unpack, but first of all, what exactly is the me-centric consumer revolution, and what makes it different from other times we’ve heard the word revolution bandied about in the consumer space?
“The consumers have taken control of the narrative”
Joel: God, I love that question, and I deal with that very specific question in the book, as you know. I think the word revolution is overused. Most things that people call revolutions are really just evolutions, and we like to hang really dramatic names on them, but e-commerce is just a change in the way we shop, and the internet was a change in the way we interacted, and so on and so forth. What the me-centric revolution really means is that, if you think about the way the retail economy worked for millennia – not decades, not centuries, but millennia, is that you had these powerful people called merchants, and they had the opportunity to choose products, decide what to sell to you, where to sell it, how much to charge. Consumers had agency – you could always take your business elsewhere. But they never really had any power.
The me-centric revolution is because of access to information, which is basically universal now – you can find out just about anything you want on any product and any manufacturer – and access to one another. And that’s the big unlock. That has created a power inversion where consumers have power over the merchants. It was a slow evolution, but when I recognized what was happening, I realized that it’s actually revolutionary. The consumers have taken control of the narrative. They don’t really care what the heretofore experts say about something. They care much more about what Instagram influencers or YouTube pundits have to say.
Many listeners are probably old enough to remember a magazine called Consumer Reports in the United States. When I was a kid growing up, if you were going to make any sort of large purchase like a car or an appliance of some sort, you would consult Consumer Reports, look at their reviews, and take their authority into consideration. Today, me-centric consumers in the metail economy don’t turn to consumer reports any longer. We’ve rejected the authority. That is the fundamental premise of the metail revolution. To me, that power inversion is a revolution. And as executives, we have to rethink everything we do in the context of that shift in the power dynamic.
The age of the quantum consumer
Liam: As you say, everything’s been flipped entirely on its head. You have customers creating the stories about products: they’re deciding where to buy and how much they’re willing to pay. We have this cult of customers realizing that they have this power, and they can start refusing to accept the way things have been for, like you say, millennia.
“Technology has created this pure frictionless ability to move around in a way we never could before”
Joel: And let’s take it one step further. I write about a company in the book called Lolly Wolly Doodle. It doesn’t really matter other than I love saying that name. Today, if you disappoint a customer, they can turn around and become your competitor. It’s never been easier to source merchandise, put it up on a beautiful website, and have a third-party logistics company ship it for you. Not only can your customers reject you as a place they would do business with, but if you make them angry enough, they can actually turn around and become your competitors. Think about that for a second. And if that’s not a revolution, if you don’t see that as a complete total upending of the way we learned how to market to these reliable demographics of consumers, then fine, the book is not for you.
Liam: And how did that flip happen? We had all these mantras of “the customer is king” that we always embraced.
Joel: The how is technology. There’s no question about it. But it’s not technology per se, it’s what technology has allowed us to do. It has enabled very frictionless movement. First of all, from a physical location to a digital location – there’s no friction in hopping from one company’s website to another. And there’s also no friction in connecting with like-minded individuals and then disassociating with them. Technology has created this pure frictionless ability to move around in a way we never could before. I also introduced this concept of a quantum consumer.
“As a consumer, you’re not just me-centric – you’re also quantum in that you can be two completely different consumers at the same time”
Liam: I’m worried my lack of physics knowledge is going to hinder me here.
Joel: The last physics class I took was in high school. I am a philosophy major, and I can’t explain quantum physics to you, but the concept of quantum physics is that a particle can exist in two places simultaneously. I don’t have any idea whether it’s true. I personally can’t validate it. This is what the smart people tell me. That’s who consumers are today.
As a consumer, you’re not just me-centric – you’re also quantum in that you can be two completely different consumers at the same time. I could be in line waiting to fill my car up with really inexpensive gasoline because I’m very cheap and gas prices offend me, and while I’m waiting, I can be scrolling on my phone on Saks Fifth Avenue for some luxury fragrance or article of clothing.
That creates an incredible challenge for marketers to figure out how to connect with me because I’m not a reliable demographic. And it’s not like people have changed, we’ve never been reliable demographics – we just have never been able to do anything about it until, about 20 years ago, as the internet came along, we started to meet one another online and started to embed this into ourselves. The revolution is the access to information and access to each other that is enabled by technology.
Liam: I love the whole cat in the box-
Joel: God bless Schrodinger. I don’t understand that either, but it’s fun.
The six Cs of the metail revolution
Liam: So, for businesses now freaked out by this quantum physics analogy, can you take us through these six strategies you talk about in the book and their significance?
Joel: Yeah. The first part of the book makes the case for the metail revolution and the quantum consumer. And if you don’t buy it, that’s fine. It’s just my point of view, well-informed over 30 years post-college and another seven or eight pre-college of doing nothing but working with consumers, but I might be wrong. But if you buy it, you move into the second set of the book, which is the strategies for making connections with consumers in this metail economy. And then, the third part of the book is the “Holy crap, we’re doing everything this way. We acknowledge the metail economy, and these are good strategies. How do we think about changing our business? How do we think about changing our operations?”
“These are the six ingredients that help you build relationships. You have to figure out which ones are relevant to your consumers”
The middle part of the book is about the six strategies to regress to the things that we all, as human beings, understand and know and to create real meaningful connections for us. That’s the purpose of the Six Cs (other than that, to sell books, you have to have a catchy subtitle, and this is something my editor liked). The six are cost, convenience, category expertise, curation, community, and customization. I’m a recovering management consultant, but this is not a management consultant-oriented book where I take these six things and basically say, “If you do these six things, you can be great like company X, Y, and Z.” I reject that line of business book.
The six Cs are ingredients. So take them just like you’re on the Great American Cooking Show and use them however you see fit. These are the six ingredients that help you build relationships. You have to figure out which ones are relevant to your consumers. You have to listen to your consumers and employ them relentlessly.
Let’s take them one at a time. Cost is the easiest to understand, but it is one that companies get wrong. If you are going to be a cost competitor in a metail economy, you have to be the lowest cost for whatever it is you’re selling because consumers know now. You cannot compete as a cost retailer and charge more money than someone else selling the same product or service. Now, you can have an element of cost, but if cost is your strategy, if you are a hard discounter, then you have to be the least costly place for the consumers to get it, or they will know you’re not and they will not give you credit for being a cost competitor. By the way, that’s the point about all of the Cs, but cost galvanizes it for everyone. It’s the easiest thing for consumers to check.
The next one is convenience. The thing companies miss on the convenience element is: convenient for whom? If you’re going to be a convenience competitor, it has to be convenient for your customer. End of story. Too many companies take purported customer conveniences and decide they cost too much and pull back or try to trick customers. A thing I do, which is a death sentence for a management consultant, is I actually tell stories about companies doing things wrong, and I name names. So, it’s a fun read. But the point is, if it so happens that that customer convenience can also be a business benefit to you, fine. But if you start with, “How do we make more money by offering a customer convenience?” Then you’re starting in the wrong place.
“True bespoke customization is difficult, but technology has advanced to the point where virtually any product and experience can be sufficiently altered to provide the illusion of customization”
Category expertise is the difference between walking into a big-box category killer, which doesn’t really have a lot of expertise when you need help, and your local shop, which truly understands the part you’re looking for or the cheese you want to buy or the wine you want to pair and gives you that expert opinion. If you’re going to be a category expert, you have to know everything or where to find it if you don’t know something. That’s what true category expertise is.
Customization is a fascinating chapter, and people confuse personalization and customization. I don’t believe in the word personalization. What people call personalization is basically trying to drive a car by just looking in the rear-view mirror. You can’t see where you’re going when you do personalization based on historical things that I’ve done. You’re not getting a total view. Customization means providing the customer something they think no one else can get.
True bespoke customization is difficult, but technology has advanced to the point where virtually any product and experience can be sufficiently altered to provide the illusion of customization. You don’t have to be a bespoke tailor, but you have to provide the illusion of customization, which is, I say, n+1 choices. It’s however many choices you need to put in the mix so that the customer feels like they’re getting a customized experience. Manufacturing technology and service delivery have never been easier to customize.
My favorite story in the book is about curation. Curation is difficult to scale because true curation creates an environment where I walk in and think to myself, “I have to be the only customer for this store – this was tailor-made for me. How did they know I like this scent? How did they know I like these colors or music or clothes or whatever?” But curation can be scaled. Ralph Lauren is a good example of someone who curated a lifestyle. 98% of the customers that buy Ralph Lauren products don’t even know what a polo horse looks like, much less have been to a polo match. So, it can be done, but it’s extraordinarily difficult.
My wife was in her favorite store trying on jeans. The store is completely curated for her. The proprietress, a woman named Tess, is there, and that’s the key to curation. You have to have the proprietress. If you can scale the proprietress, you can scale a curator. But if you can’t, then you can’t scale a curator. And that’s the lesson. Anyway, she’s been shopping there for 20 years, and she’s trying on a pair of jeans. She says, “These jeans don’t fit. I need a bigger size.” And the proprietress’ answer was, “Try harder.” This is not customer service. This isn’t, “Make me feel good.” This is, “Make me feel like I belong.” And it’s a delightful shopping experience.
“It has to come from your customer. If you are sitting in a conference room debating which Cs you want to put in the marketplace, you missed the whole point of the book”
The last one is community. It’s extraordinarily difficult to create a community, and it’s extraordinarily easy to violate a norm and destroy that community. If you’re going to use the community C, you have to be committed in good times and bad times. We can all think of companies that are going through struggles right now where there are real challenges – operational, strategic, political, what have you – to a community they’ve created and figuring out how to navigate that while still living up to your promises to your community. That’s the crucial part.
Liam: What advice can you give to people to help develop self-awareness through the lens of these six Cs?
Joel: The simplest advice I give to companies is that it has to come from your customer. If you are sitting in a conference room debating which Cs you want to put in the marketplace, you missed the whole point of the book. The book is filled with stories of CEOs who bucked trends and were able to successfully transform businesses without doing what all the experts said they should do. In fact, the experts were screaming they were doing it wrong.
One of the companies I write a lot about is Target. When Brian Cornell was investing billions of dollars in store infrastructure, Wall Street and all the experts said he was crazy, that it was a huge mistake. Of course, it was not a huge mistake. He doesn’t speak a lot, but occasionally, he will be asked, and he says, “This is what our customers were telling us they wanted.” And that sounds so simple. And people say, “Well, I don’t need your book to tell me that.” And yeah, you kind of do. Because how often do you feel like you are at the center of the business model of the company you’re interacting with?” I would speculate it’s very, very, very infrequently. That’s the beauty of this book. We’re all consumers as well as business people. You start from the consumer and then make hard choices about changing things in your business.
Another tool in the box
Liam: I can’t let you go without asking what you think about ChatGPT and AI and how that’s going to affect CS going forward?
Joel: ChatGPT is just like e-commerce, virtual showrooms, augmented reality, and virtual reality. It’s just another element that companies can use or not to provide experiences to their customers or operational efficiency inside their business. We don’t have long, but what I would say about ChatGPT and AI, in general, is that it’s problematic to think of it as predictive for the same reasons that personalization is problematic. By definition, it cannot be predictive. The things that human beings do is take signals and experience, think about future outcomes, make choices based on those outcomes, and present consumers with options. AI can’t do that. AI can only take things that really happened and then present you with options or choices.
“I’m a big believer in it, but ChatGPT and artificial intelligence are not a revolution. They are simply another tactic that you can employ or not”
But it’s an incredibly interesting place for companies that can’t spend enough money to provide the level of customer service they need. Yesterday, I needed to interact with a financial institution on a very mundane topic that had a chatbot on their website. After three seconds, it figured out what my thing was and was like, “We’re going to connect you to an agent.” And it said, “You’re very important to us, and the next available agent will be ready in approximately 17 minutes.” That’s not good. And if you can’t get enough people to satisfy your customer so they can get on chat in two or three minutes, then you probably want to think about deploying some sort of AI to get people through the process faster. And that’s an example of what I talk about in the book.
I’m a big believer in it, but ChatGPT and artificial intelligence are not a revolution. They are simply another tactic that you can employ or not. The revolution is understanding that companies no longer control the narrative. Companies are no longer in the power position that they were for millennia.
Liam: Lastly, where can people go to keep up with you and your work online?
Joel: The best place to find me right now is LinkedIn. I’m also on Twitter, but LinkedIn is the main place. And I’m fairly active, so if people want to reach out and engage in a dialogue, I would encourage them to. And you can pick up the book anywhere books are sold, as they say.
Liam: Perfect. Joel, thank you so much for joining us today.
Joel: My pleasure, Liam, this has really been enjoyable. Thanks for having me on.
