Real Estate Journal — Brokerage Directory — July 26 - August 8, 2019 — 11C
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B rokerage D irectory By Phillip A. Azarik, Metro Commercial How to sustain retail for the next 20 years
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lot of speculators claim Amazon and other on- line retailers are domi-
in front of their audiences, and should make good use of them. Running Instagram ads, for example, and other social me- dia activity are now a must. An omnichannel strategy in which customers have one seamless buying experience across your online and brick-and-mortar presence allows them to buy products in whatever way is most convenient for them. That might be ordering online and picking up in store or trying on clothes in store and order- ing them online; the point is to provide customers the experi- ence they want, whatever that
might be. Most critically, technology allows retailers to find the best shopping centers for their stores. Using the GPS on con- sumers’ phones, analytics can help retailers pinpoint a loca- tion to lease based on where their customers live and work. In addition to technology, retailers need to consider the role experiences play in their physical locations. More than ever, customers are looking for ‘Instagrammable moments’ they can share with friends and family across social chan- nels. Online retailers can never
replicate certain experiences, and that gives brands an oppor- tunity to make their physical locations stand out. In any shopping center, food and beverage concepts have staying power because you can’t buy that experience online. That’s why more fast-casual eateries and other restaurants are increasingly taking up residence in shopping centers. Other retailers are differentiat- ing themselves with everything from one-of-a-kind displays to in-store stylists and tailors to simply giving customers the opportunity to try out or try on
the products they want to buy. Landlords are helping out by driving redevelopment fo- cused around a live, work, play atmosphere. Malls and shopping centers are typically well-positioned assets, central to train lines and highways, which helps drive the concept. The Exton Square Mall, for example, recently added a 342-unit apartment tower to complement the Whole Foods Market and the Round1 bowl- ing and entertainment center on the property, as well as the nearby offices. continued on page 24C
na t i ng t he market, but the numbers s a y o t h e r - wise. While Amazon rep- resents half of all online r e t a i l , i n 2018, it was
Phillip A. Azarik
only five percent of overall re- tail sales. In the first quarter of 2019, all online sales totaled just 11.8 percent of overall retail. But of course, retailers would be unwise to ignore the chang- ing industry. What worked 10 years ago is not what works today. The brands with staying power will be those willing and able to evolve and blend tech- nology and new retail concepts into their business. A decade of retail evolution When I started in retail nine years ago, new developments were springing up left and right. In the wake of the reces- sion, the market had nowhere to go but up. Lumber Liquida- tors was leasing 40 proper- ties a year. PetSmart was actively expanding, seeking out 30,000-square-foot spaces. Now the market has shifted. The velocity of deals has slowed. Retailers are interested inmore compact spaces. PetSmart, for example, is now opening stores closer to 12,000 square feet. Hub-and-spoke models have emerged in which one major retail location with a large warehouse feeds a number of smaller showrooms in the area. That evolution has been driv- en in part by data analytics that deliver better intelligence about where to locate stores and what customers want in those loca- tions, as well as omnichannel strategies that don’t require massive store footprints. How retail can thrive over the next 20 years When I see retailers struggle, it’s usually because their brand has grown stale and they no longer resonate with consum- ers. That typically happens for two reasons: They haven’t caught up with technology and/ or they aren’t embracing expe- riential retail. Consumers can easily over- look retailers that aren’t em- bracing technology. From social media to push notifications to omnichannel strategies, brands have any number of ways to get
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