Saving Main Street From Its Downward Pandemic Spiral

Consumers crave certainty, and they work pretty hard to minimize the risk of making a bad choice. That’s why once consumers find something that works, they stick with it. And it’s why other people’s thoughts and actions factor so heavily into their decision to try something new.

To describe these behaviors, author and behavioral scientist Dr. Robert Cialdini coined the term “social proof” in his landmark book, “Influence,” which was first published in 1984.

According to the theory of social proof, if consumers see enough people doing the same thing, others will feel comfortable following along.

Product recommendations are an example of social proof at work – if other people have good experiences with buying a particular product, that boosts the chances that other consumers will buy it, too. It’s why recommendations are consistently ranked by consumers as one of the most important features a merchant can offer an online shopper, why merchants gladly oblige and why brands strive to make products that are consistently ranked high by consumers.

Influencers also provide social proof that wearing or using a particular brand will reduce the risk that a consumer will commit the ultimate fashion or beauty faux pas. It’s why influencers use social channels like Instagram to share their experiences, why brands provide influencers with incentives to hawk their products, and why brands sometimes even send fashionistas and celebrities free stuff in the hopes that they’ll wear and share it.

In physical settings, social proof leads to something else: the vibe and atmosphere that’s created when a critical mass of people show up at the same place – virtually or physically – to see or do something. People are more likely to get together because they rely on social proof from others, but also because they enjoy being with lots of other people, even when they don’t know them.

It’s why consumers would rather wait in line to eat at a crowded restaurant than go down the block to an emptier one. Crowds send a visual cue that the food is going to be better – and so will the vibe, since so many people seem so happy being crammed next to each other at dining tables and at the bar waiting to be seated. So much so that consumers believe it is worth the wait.

It’s also why many people find it uncomfortable and even awkward to walk into a store without first seeing other people milling around inside, and if they don’t, they decide to keep walking. An empty store raises questions about the quality of the store and the products it is selling.

And as much as people may complain about the crowds in the stores or on Main Streets, they like being part of the hustle and bustle – and the energy it brings.

Living By The Social Proof

Social proof – and the vibe that goes along with it – can create the network effects that drive business growth and prosperity. More consumers in a crowded store or restaurant means even more consumers will visit the crowded store or restaurant, as word spreads and people see and experience a store, brand or chef’s popularity. More consumers mean more sales – and more sales means growth, expansion, jobs and prosperity for the business, its workforce and the local economy in which it operates.

Social proof can also work in reverse.

Not seeing enough consumers in the shops, malls and restaurants is evidence that not enough people think it’s worth their time or money to visit or buy from them. Rather than buck the trend, consumers gradually just stop showing up – and that’s the power of social proof. It’s not fun to consistently be one of only a few people at the store or walking through the mall or getting their choice of table in an empty restaurant.

Before long, the network effects begin to work in reverse, as having fewer consumers means fewer sales, making malls less attractive as more stores pull out, and as shops and restaurants become ghost towns as their once-regular customers flock to the places where there is more of a critical mass and the experience feels more alive.

The pandemic and its unexpected duration have put an exclamation mark on this powerful dynamic in the physical world by accelerating the demise of the shops, malls and restaurants that were already on shaky ground in January of 2020.

But it has also put an additional burden on the establishments that were humming right along, on their way to having another great year – but were forced to close entirely for a time, then reopen later at reduced capacity.

In the U.S. (and many other countries), nowhere is the pandemic’s impact felt more than on the Main Streets whose existence and business model is based on daily sales and foot traffic, and the energy that consumers bring to those establishments – and to the workers at the ready to assist with their purchases.

A lack of tourists, or lack of workers milling around during their lunch hours or after work, or lack of college kids roaming the shops and the bars, or lack of enough people living in the neighborhoods feeling comfortable enough to go out to shop or eat – and happy with the experience they find when they do – has only fanned the flames of the dynamics of social proof working in reverse.

For Main Street businesses, the pain isn’t the result of just one shop or restaurant closing down, since the churn of small businesses is part of the small business reality – particularly in the retail and restaurant sector. But in a vibrant economy, “for rent” signs are temporary, as new establishments with new products and new experiences quickly take over the spaces that others have abandoned.

The pain now is the growing number of establishments that have called it quits, the uncertainty of when people will feel more comfortable reengaging in the physical world the way they once did – and if or when those shuttered storefronts will be reopened by their previous owners, or new ones.

And all of that is having a ripple effect on the businesses that are trying to reverse the rising social proof that suggests no one finds those once-vibrant Main Street shopping thoroughfares all that appealing anymore.

Saving Main Street

The owner of an upscale hair salon in Boston is an example of a business living this reality.

Hair salons, of course, were shut down completely during the pandemic, and their reopening was gradual. Restrictions still require that her business – and others’ businesses – operate at a much smaller capacity.

Like every other small business on Main Streets everywhere, she figured out how to make lemonade out of lemons – a particularly challenging feat, since haircuts are one of the personal services impossible to replace in a digital world. But she got creative, inventing “in a box” hair kits mailed to her customers for hair treatments and touch-ups. This product innovation has become a permanent offer for her clients who travel, or who spend time outside of Boston during the winters and summers. She was an early adopter of Zoom for client consultations, enabling her to talk through hair crises with her stylists and stay in touch with her regular customers while she waited to reopen.

Since reopening in late May, she says she’s recovered not all, but a good chunk of her sales. But that’s not what’s worrying her now.

Her concern is the growing number of empty storefronts all around her shop, and a lack of takers for those empty spaces.

More troubling is that her salon is on Newbury Street, a fancy-schmancy shopping street in Boston.

Newspaper reports in September say that more than 55 storefronts remain vacant on Newbury Street more than six months into the pandemic.

Even more of them are closing.

Brooks Brothers, which occupied a huge footprint in the first block of Newbury Street, is pulling out. Smaller boutiques that have operated for eight or more years, or that have expanded their store locations to the once-busy Newbury Street over the last five or more years, are closing their doors.

Real estate broker CBRE reports that foot traffic, and the corresponding sales it brings on Newbury Street, is at its lowest level since the 2009 financial crisis. Real estate deals for what were empty storefronts in February remain on ice.

Consumers are buying different things, buying them from different stores and buying them online.

Meg Manzier-Cohen, the head of the Back Bay Association, the neighborhood in which Newbury Street operates, says all of this presents a “dire” situation for dining and retail establishments there. No one, she says, is “running around wearing diamond necklaces in their sweats.”

The foot traffic up and down Newbury Street that once drove its vibe once came from everywhere – the parents visiting their kids going to one of the many universities there, the business travelers and conventioneers, the tourists coming to visit Boston and all of its historic landmarks, the office workers nearby who lunched on Newbury Street and met clients for dinner at one of the many restaurants, the locals who ran errands at one of its many cute shops and stores, and grabbed coffee or lunch or a mid-afternoon bite to eat while doing so, the kids and their friends and families who made shopping on Newbury Street a fun weekend social experience.

Even as stores have reopened, the big chunk of foot traffic walking up and down Newbury Street hasn’t returned. And it may not for a long time. Aside from the construction vehicles doing work on the streets, it’s easy to find a parking spot.

The hustle on Newbury Street has lost its bustle.

The Ripple Effect

What worries this salon owner is the impact of social proof in reverse.

She was never dependent on foot traffic for sales, but many of her clients living outside of Boston would bundle hair appointments with shopping with friends and family on the weekends, and errands during the week.

She worries that coming to Boston will now be an inconvenient and time-consuming trip for them, with nothing else to do but get their hair done and go home. The pandemic has taken the fun out of the social experience of shopping and eating out. She worries she’ll lose customers over time.

The salon owner has decided to take matters into her own hands and do something to reverse the “social proof curse.” She’s decided to create a new shopping experience inside her salon.

Since her salon is busy and has foot traffic, she’s decided to allot space in her salon for the shops on her block to sell products, in hopes that her captive audience of customers will discover and buy cool things from those merchants while getting their hair done. She wants nothing from these merchants, other than the opportunity for them to make sales and gain customers so they can keep their doors open.

And to avoid having one more “for rent” sign going up on her block.

She hopes this will encourage other salons – her competitors – to do the same up and down the street. Businesses helping businesses stay alive to give Newbury Street back a little of its hustle and bustle – one new customer at a time, even if the new customers continue their relationships with those stores online.

The most important thing to her is providing the social proof that businesses are open, ready and waiting for the customer to return.

Reimagining Main Street

Consumer concerns over the certainty of their health and safety and that of their families have changed how they go about their day-to-day routines – how they shop and where they eat.

With many employers opting for a partial return, and not until mid- to late next year, many of the shops and dining establishments up and down the Main Streets that served them will continue to face challenges in filling the sales gaps that daily foot traffic once delivered, and on which their retail neighbors once relied to bring feet into their own shops.

Although it’s not clear how much foot traffic will return once we have all the silver bullets of vaccines and therapeutics available.

PYMNTS data show that consumers have become more and more reliant on digital channels – digital-first and digital-only – to engage with merchants. And the longer the pandemic lasts, the less likely consumers say they will revert to all of their former shopping habits.

We find, too, that consumers have shifted not only the channels they shop, but also when they do their shopping. More consumers than ever have shifted grocery and retail shopping from weekends to weekdays. The incidences of social shopping with family and friends on the weekends have also declined – across all geographies, including local cities and towns all across the U.S.

Meanwhile, when we come out on the other side, many people may continue working from home, as workers and employers find that doing so works out well for both.

To get the social proof, and the vibe, that made Main Streets successful, those Streets will need to change. Otherwise, some of them will have the sad fate of the “dead malls” that die because stores don’t want to relocate to where shoppers don’t come, and shoppers don’t come to places where there aren’t appealing stores. Main Streets will need a mix of stores that provide the social proof, and vibe, that made Main Streets a fun place to spend a Saturday.

It isn’t too early for Main Street business associations, landlords and cities — all of whom have stakes in the successful outcome — to think of ways to get the vibe back. They share a collective fate.

Suburban Main Streets might get a boost. Main Street foot traffic may be redistributed — from urban streets like Newbury Street to suburban ones close to where more people live and work. New, more vibrant Main Streets will emerge outside of urban locations, catering to those whose daily routines now keep them closer to home — as long as they have the right mix of stores, of course. Then again, a consumer who has shifted chores and errands to the weekday will have more time to enjoy all of the things that a vibrant urban Main Street, like Newbury Street, did – and can continue to – offer.

In a recent PYMNTS study, more than two-thirds of consumers say that saving Main Street is a key priority for the shops themselves, and for the health of their local communities. More Main Street businesses say they are optimistic about their long-term prospects, even though most remain challenged to replace all of the sales lost to the pandemic.

There’s a reason for their long-term optimism.

We’ll get the social proof that will get the vibe back. This will take time, since many nice stores have closed down, more will likely close, and people will stop coming. It’s why there is so much urgency to reduce the health risks for consumers, so they can more quickly get back to normal.

At the same time, we must find ways to leverage the creativity and resilience of Main Street USA and develop creative ways to stem the shutdown of the stores and restaurants that people will no doubt seek out when they feel safe to return.