YOUR BUSINESS AUTHORITY
What’s the mission behind Husch Blackwell’s Retail Institute, and how is it helping brick-and-mortar businesses?
The whole purpose of the Retail Institute was to help our clients evolve with the industry. We’re partnering with leaders in business and professional associations with the goal of creating in-depth knowledge of the industry through an open exchange of ideas, innovations and experiences. It’s a new initiative started last year. It’s outside of our traditional legal practice.
What trends are affecting brick-and-mortar stores? What do consumers want and need in this industry?
You hear all over the place that brick and mortar is dead and e-commerce is taking over, and I think that’s greatly exaggerated. It’s not dying; it’s evolving. The retailers that are going to remain successful in the market are the retailers that are willing to adapt to the customers’ changing needs and wants. The consumers are pushing it through the change in customer habits and customer outlook. Ten years ago, the challenge was getting people to buy things online. Today, one of the main challenges is getting things to people fast enough. The customers now want what they want, when they want it and how they want it. The concept of omnichannel retail is bringing all the digital and physical outlets together in a seamless ecosystem. Somebody can buy online and return in the store or buy online and pick up in the store. It’s going to be more difficult for retailers that don’t have the mass to spend the money to make those things work together. Customers that shop online will spend five times more money than customers who just shop one or the other. Omnichannel works.
Multiple studies cite roughly 85 percent of retail activity is still done in brick-and-mortar stores. The National Retail Federation says that for each storefront that closes, 2.7 open. How are retailers defying these e-commerce trends?
Experiential retail. There’s an increased attention now on the consumer experience. The previous focus in the boom of big box and Walmart explosion was quickly growing scope and scale and it was causing the customer experience to diminish. Experiential retail is the retailers making a specific effort to create something more than just shopping. If it’s a store that sells fitness apparel, they’ll bring in workout classes and a focus on in-store events that create excitement and something to Instagram about. It’s a feeling that you get when you go to the store. Bass Pro [Shops] does a fantastic job of this. The big boxes, the retail anchor stores, are going out and what’s coming in are repurposed to tenant space that is including mixes of high-end tenants and restaurants and bars. They are having to get creative, but we’re seeing a lot of that right now – the repurposing of the big box space and the whole concept of transforming shopping centers into more like lifestyle centers. We’re either redeveloping existing, underperforming retail assets or developing new ones. For the mall developments, rather than just putting in more retail tenants, they’re adding attractions like aquariums, bowling alleys and jump houses. You’ll start seeing a lot of fitness gyms going into old anchor tenant spaces. For new developments, the thought process is really expanding the concept of mixed use. Shopping is now more of an event. Farmers Park is a good example of that. It has office space, it has the farmers market, it has retail space and restaurant space and multifamily residential. Customers want more localized products. It’s demonstrated by craft beer and how it’s exploding all over the country. They’re into things that are local and small batch. Retail isn’t dying. It’s just changing. It’s been the same for a long time and the customers are not. Retailers are trending up.
Lindsey Lund can be reached at firstname.lastname@example.org.
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