Neighbourhood or web: without rest or peace (or maybe not)

negozi di vicinato
Michele Caprini
18 Dec 2020

The neighbourhood shop takes the stage lights all for itself. This obviously because it’s Christmas, because the threat of COVID-19 is still present and because behaviours change accordingly, expressing the desire for recovery both with a click and by entering a shop.

eBay, among the online marketplaces who made the history of e-commerce, today presents itself on TV and on the web with the story of a neighbourhood shop, seen through the relationship of a father with his daughter. In the video appear the shop counter and a delivery man at the door, and they do not seem at all in contradiction. In these troubled times, eBay wants to show itself close to small businesses, inviting customers to support them with their purchases.

#NoelSansAmazon

The conflict between the two forms of commerce has taken on a growing importance and media relevance. Amazon reasserted its e-commerce leadership thanks to the pandemic, whereas for several neighbourhood shops, linked to the physical presence and pedestrian traffic, the health emergency has instead meant heading sharply towards disaster; a negative trend which has increased markedly in recent years.

In France, a campaign against what is called a ‘predatory’ company promotes the return to local trade, facing growing and often fatal difficulties due to social distancing restrictions and safety measures.

Dear Santa Claus, this year we are committed to a #ChristmasWithoutAmazon”. This, in a nutshell, is the spirit of the campaign, also shared by the Mayor of Paris, Anne Hidalgo, to which the Confederation of Traders, the Bookshops Union and Greenpeace are party.The promoters of the initiative paint a gloomy picture of the social, fiscal and environmental consequences of Amazon’s development, and encourage the French to give priority to neighbourhood shops or the circular economy for their purchases.

In the world, however, hostility to Jeff Bezos’s colossus is getting stronger and stronger. In the first nine months of 2020, Amazon’s revenues topped $260 billion with a stock market valuation of $1.6 trillion (Italy’s GDP is worth about $1.8 trillion), and allegations of monopolistic practices and tax avoidance are growing.

The crisis from Italy point of view

According to ISTAT (Italian National Institute of Statistics), in the second quarter of this year the number of people employed in trade decreased by 5.8%, about 191 thousand less than in 2019. This represents a fall almost double compared to the general trend, equal to 3.6%.Looking then at the sales of non-food stores, these showed an overall fall of 13.5%. In contrast, over the nine months period e-commerce experienced a whopping 29.2% increase in sales.

FIPE, the Italian Federation of Public Exercises, released the data for the June-October period, which closed with a drop in revenues well over 50% for more than a quarter of its associated companies. The forecast for the end of the year is 33 billion Euros less, out of a total of 96. This means the risk of closure for 60,000 of the sector’s businesses, placing more than 300,000 jobs in jeopardy.

In Italy, the trade associations rise to the occasion and seize the opportunity to highlight the risks of monopoly power. For Confesercenti (the Italian shopkeepers association) “This second wave of health emergency is creating a very serious competition imbalance between physical stores and the web. While the former are kept closed by the Government and regional authorities’ measures, the online sales channel actually acts and operates under monopoly conditions. The aim is not to prevent online sales, but to ensure a truly competitive market in compliance with distribution pluralism”. And in Liguria even comics are used for strengthening this concept.

Pluralism?

For Carlo Sangalli, President of Confcommercio (the largest business association in Italy) “this year, in terms of consumption, we will take a leap backwards by a quarter of a century and GDP will fall well over the expected 9%”, and the Government will have to continue to ensure the granting of credit by banks and defend the ethics of commercial competition with “a fair web tax”. In a general framework, however, where “it was precisely the emergency that confirmed how crucial the Italian model of distribution pluralism is for the quality of life, which in turn means promoting Made in Italy products through the network of neighbourhood shops”.

Two steps back or one step forward?

The positions taken, although induced by real needs and evaluations, run a double risk. The first consists in strengthening the still widespread opinion of a non-existent alternative between physical and digital commerce.The second in promoting, as with the French #ChristmasWithoutAmazon campaign, a rhetoric about the good old days that clashes with the realistic prospect of a common security policy. This can only come from reducing, if not zeroing, the digital gap suffered by the sector. In short, the rule of thumb is to progress and not regret and plan the protection of the own commercial spaces using the most advanced technology.

This applies to local shops as well as restaurants, both for those who sell and for those who buy, for those who do not want to succumb to the decline or see the disappearance of their businesses, small or big, from the neighbourhood and the territory. Competing by asking for limitations is increasingly difficult, and there is no turning back when new consumption behaviours and new purchasing habits are already well established, standardized and made unique and recognizable precisely in their digital dimension. Better a step forward than two steps backward.