As a NYC resident, I face long lines with a sigh of sigh of resignation. I do not question the absurdity of the experience. Instead, I foolishly take it as a sign of stamina, even if, lately, getting tested for Covid-19 meant standing outdoors in 27-degree weather for an hour. Lately, while I’ve been in the Starbucks long line, my patience has run thin. It turns out to me that this wait was the result of my stubborn preference for buying coffee the old-fashioned way—that there was, in fact, an escape from this degrading cycle. I can simply place an order via mobile, and pick it up at the store without waiting in line.
This type of friction-free comfort is very attractive and seems to be everywhere now; It’s especially evident in transaction spaces, whether it’s Starbucks, your local grocery store, or the airport. But there is a trade-off for resetting our expectations, and it looms large. Customers these days feel they deserve it – and they are furious. People are angrier, meaner, and more likely to throw childish tantrums in front of service personnel, as detailed in a recent report. A New York Times feature titled, “Hanging State Wants to Talk to Director.” It doesn’t help us that we entered two years into a pandemic that has burst the nation’s abundance bubble (read: supply chain problems and rampant inflation).
Companies, especially those in public facing industries, face a shortage of available labor as they struggle to meet outdated service standards set at a very different time. “Public deception has forced many industries that deal with the public to rethink what used to be an article of faith: that the customer is always right,” wrote Sarah Lyall of The Times. “If employees are now having to take on many unexpected roles – healer, policeman, conflict negotiator – workplace managers act as security guards and watchmen to protect their employees.”
Some consumer behaviorists believe that Amazon is to blame for these high (and often impractical) expectations, from one-click purchasing to one-day shipping. “We call it Amazon Business,” said Thomas Holman, director of the Arizona State Center for Service Leadership. “Everyone is compared to Amazon in terms of waiting in line, types of customer interactions, and knowledge base. This perception equals all types of business.”
It didn’t help that Americans wooed the growing number of apps and technologies that speed up the way they shop. With mobile orders, instant delivery, chatbots, and even self-pay kiosks, people are promised immediacy along with better and faster service. These tools are designed to give the customer a greater sense of control over how their merchandise is received. With it comes pretending to live our lives efficiently — at the cost of digital privacy, money, and the impact tech companies have on our lives. Have you ever succumbed to a late-night notice encouraging you to order takeout?
Venture capital firms are optimistic about the crowded emerging market of ultra-fast startups, which are still not profitable without investor help. In replacing human-to-human interactions with human-to-human transactions, shoppers are choosing to get out of the mundane inconveniences associated with running errands or having coffee. This may seem like a one-to-one choice for the consumer, but it’s inspired by the post-pandemic retail and service sector that can be hostile to regular shoppers.
In October, technology writer Drew Austin noted how his regular trips to New York City’s stores and pharmacies became filled with unexpected inconveniences. There are fewer and fewer staff on shift, which means checkout queues are longer. Meanwhile, more merchandise is being closed to compensate for the potential increase in theft from installing self-service kiosks, which shoppers are encouraged to use to avoid waiting in long lines.
This makes the personal shopping experience unpleasant and unhelpful at Walgreens, where one would expect unhindered entry and exit. “The implicit message of all this, for regular customers, is that we should have stayed home and ordered online,” Austin wrote. “These spaces are not ours. We are effectively encroaching on the company’s warehouses.” He added that Manhattan is like a “post-Covid retail wasteland,” populated by vacated chain stores that are being converted into instant delivery centers.
For example, New Yorkers may have once needed persuasion to try instant grocery delivery or just delivery restaurants, which venture capitalists call “ghost kitchens.” The pandemic has changed the risks not only for consumers, who have an incentive to stay home and in order, but companies are re-examining the need for traditional retail space. Starbucks, according to the New York Times, has closed 44 of its 235 locations in Manhattan permanently since the beginning of 2020. However, it has plans to expand its mobile pickup offering and only add more pickup locations.
Research from Edge Ascential, a digital commerce consultancy, predicts that retailers could allocate up to a third of their space, once used for in-person shopping, to fulfill online orders in the coming years. This switch will likely cost businesses more money, compared to customers entering a store and selecting the items they want. The way things are, though, more and more people are choosing to have items shipped to them and have them delivered in the same week, day, or even within the next 15 minutes.
This preference isn’t just for everyday necessities like groceries, baby formula, or toilet paper. Direct-to-consumer startups, particularly those in the household goods and food and beverage space, are trying to reach urban shoppers with on-demand delivery. “What we’re trying to achieve with express trade is giving people the ability to get as close to instant gratification as possible,” the head of customer experience for Olipop, a low-calorie alternative soft drink, told Thingtesting. “If consumers are looking for a late-night drink, we want to make sure it’s an Olympus.”
Despite the booming landscape of instant delivery apps, most of them have yet to generate sustainable returns for the multi-billion dollar investors. As much as Amazon and delivery companies like DoorDash, Uber, and Gopuff pay to turn urban centers into fulfillment centers, complete with ghost kitchens, fake brands, convenience stores — and all the annoyances of in-person shopping — they will still be around in some capacity. Shoppers still love to wander around malls, no matter how technologically adaptable they are.
Amazon may have wooed customers with its standards of ultra-quick delivery, but its business model is not without logistical complexities. One-day shipping is expensive and depends on a huge workforce with low wages that small retailers cannot afford. “What solves all these problems—high return rates, expensive last mile shipping, logistical nightmares, buyer frustration, the sheer volume of consumer waste they send all to landfills—on some level? The stores are going to the store,” writes Amanda Mull of Atlantic.
At the start of the pandemic, Americans avoided in-person shopping out of necessity. Today, with most businesses reopening in one form or another, more are choosing to stay away from stores due to the declining value of customer service. It is the result of many cost-cutting factors that retailers have implemented, from the introduction of new technologies to underemployment. Meanwhile, delivery appears to be an antidote to store chaos, when in fact, it isn’t, from a retailer’s point of view.
Soon, retail employees may be too overwhelmed with delivery quotas to be excused that customers are no longer required to speak to a manager. The future of retail wants to deliver superior customer convenience. But is all of this really good for us? Is it financially viable?