Changing Demography and Your Future

Seriously who do those pesky little girls in green think they are anyway? We live in a free market. They didn’t invent cookies. OK, sure there are certain cookies that bear their signature and are sold on the merits of exclusivity but who’s to say that other retailers can’t capitalize on the market that the Girl Scouts of America established with decades of shoe leather by selling door to door? After all it happens all the time, small organizations establish a market and set the stage for larger more sophisticated corporations to take the process to the next level. So, what’s the big deal about Girl Scout Cookies? Are they a sacred product that is off limits to retail giants? It seems Wal-Mart asked that question internally and the answer was no.

Girl Scout cookies are big business. Nationally they sell over 100 million boxes a year in what amounts to The Girl Scouts most successful fundraiser. Someone at Wal-Mart apparently did the math and recently determined that this could be a profitable category for them. It is not clear where Wal-Mart will manufacture their knock-off cookies but it is certain that China is being considered. We’ll have to watch the ingredients carefully.

Many would consider this move by Wal-Mart to be reckless because of the certain public relations risk attendant in such a decision. Clearly Wal-Mart could make a case for check-mating the Girl Scouts but the reasoning would ring hollow and point up their lack of a moral compass. Wal-Mart is in financial trouble and the more trouble they get into the more desperate they become. Taking on the Girl Scouts is a desperate move made by a desperate retailer. What’s next? Maybe they can find a market for blood and edge out the Red Cross?

Shifting demography is dealing Wal-Mart a bad hand and they have no clue that it is happening. The bulk of their principal customers, The Baby Boomers, have crested fifty-years-old and according to the Bureau of Labor Statistics are weaning themselves off the consumption of stuff. The huge generation of Baby Boomers was a perfect customer for Wal-Mart. They knew what they wanted and Wal-Mart sold it for less than anyone. Selection and fashion were not considerations. Unfortunately for Wal-Mart, Generation X born right after the Boomer Generation is too small to consume at the level of the Boomers or satisfy the sales needs of the Wal-Mart retail footprint. Wal-Mart’s only market hope was the huge Generation Y born 1985 to 2004. The problem is young markets demand fashion and selection. Wal-Mart’s retail model of “Cheap and Deep” can not accommodate this market. Small start-up entrepreneurial fast turning retailers will flourish and eat up Wal-Mart’s business like a school of piranhas.

Are all big box retailers in trouble? No. Target, for example seems to have a governing ethos that is compatible with Generation Y. They are cool, caring and have fair prices. Wal-Mart’s indifference to human relations issues at all levels will seal their fate with Generation Y.

Generation Y is rewriting the rules for doing business, especially retail business going forward. Generation Y is “Green” to a fault and “Green” is not limited to environmental issues. “Green” to Generation Y is all about giving back. You can give back to the environment and you can also give back to your fellow man. Smart businesses, especially retail, need to develop a “Green” story and act on it publically with sincerity. Faking a “Green” story is called “green washing” and will be met with distain on the part of Generation Y. A Generation Y boycott would be deadly and certainly not worth the risk.