A Retail Renaissance, a Return to Normal or the Start of a New Era?
As retail sales roar back from the brink, the public narrative has subtly shifted from apocalypse to a renaissance. And while there have been some impressive gains in the overall growth of e-commerce during the pandemic, the overwhelming majority of these new retail sales are coming from brick-and-mortar stores.
So while the convenience of home delivery and curbside pickup are obvious to all, consumers still find a trip to the local store or shopping center to be attractive.
Placewise conducted a shopper survey in November to see how consumers felt about stores and the places that host them in a world with endemic COVID. It came as no surprise that the overwhelming majority of consumers still enjoy shopping in person for all the reasons many of us already know — store experience, touch and feel, store reps, habit, and convenience (yes, stores too can be convenient!).
But all is not quite clear or back to “normal” for retail, especially shopping centers. Only 15 percent of respondents felt the experience at their local shopping center had improved over the past five years. Nearly half thought it hadn’t changed at all, and over a third thought the experience was worse. That’s a big opportunity for both retailers and shopping center operators.
COVID brought the idea of digitally accessible on-demand products and services into the forefront and into the minds of the final holdouts to the digital economy. Everyone is in on it now. It fueled the expectations of all consumers with regard to how they interact with stores. It can safely be presumed that the new world order for retail of all sorts — stores, malls and really any shopping place — is going to need to include things like same-day delivery, centralized pickup, simplified digital transactions, and even rewards and perks.
The pandemic didn't turn the average consumer into a social shut-in that's hidden behind the walls of their home requesting contactless deliveries and pickups. Quite the opposite, in fact. We all realized that we're indeed social creatures and we had a craving for the experiences we all missed in the early days of COVID. Pandemics throughout history have never been able to disrupt the core fundamental principle that we're all social creatures. Even the most “unsocial” among us need to venture out into the world, even if it's just to gather more evidence that they don’t like other people!
For shopping places — like malls and stores — the opportunity is to tune into the newly evolved expectations of the consumer and deliver an elevated experience that brings digital tools into the physical store. It's a new era of retail when online, offline, in-store, same-day and curbside all simultaneously exist neatly sitting side by side in the consumer's mind, ready to be deployed based on today's whim, time constraints or desire for experience. And that’s why 80 percent of the survey respondents had interest in digitally powered shopping places.
We know from our work with more than 1,100 shopping centers in North America, Europe and Asia-Pacific that the store is making a comeback. The difference this time is that landlords and shopping center operators know they need to have a direct relationship with consumers so they can better serve them. A big part of the solution is evolving the physical shopping center from physical marketplaces — which they’ve always been — to digital-enabled marketplaces.
Get ready, it is indeed a new era for retail!
See the full survey results here.
John Dee is the president of Placewise Americas, a company that connects shopping centers with consumers and their tenants, improving footfall, conversion and productivity.
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In the early days of the Internet, I was fortunate enough to work at MCI on Vint Cerf’s Internet team where we had a front row seat to a true communications revolution. We were pioneering the infrastructure on the “information superhighway”, building the plumbing if you will. We came across lots of ideas and early digital business models, many of them centered around retail.
And years later it still seems like the waves of change just keep coming with greater speed and deeper impact on society as a whole.
At some point I made the move from the world of Internet plumbing into Internet applications and services. I became fascinated by how people and society interacted digitally, and the impact that was having on retail and commerce.
Today, I feel lucky to lead an amazing team of professionals at PlaceWise who work hard to contribute in our own modest way to the digital revolution in retail.
Exploring the ebb and flow of retail in the digital world is what I wake up thinking about every day. And It remains a really fun ride.
When I’m not thinking retail, I’m probably watching hockey, riding my bike or throwing down some sweet beats as DJ Yahya! I am lucky enough to born and raised in colorful and most awesome Colorado!