Rebuilding Place in the Urban Space

"A community’s physical form, rather than its land uses, is its most intrinsic and enduring characteristic." [Katz, EPA] This blog focuses on place and placemaking and all that makes it work--historic preservation, urban design, transportation, asset-based community development, arts & cultural development, commercial district revitalization, tourism & destination development, and quality of life advocacy--along with doses of civic engagement and good governance watchdogging.

Friday, July 15, 2016

Successful retail today often includes food, experiences, social elements, and isn't rote

I wrote about retail within the last couple weeks but last week the Washington City Paper had an article, "Can coffee and booze coexist with local retail?," about the rise in coffee shop + bike shop combinations.

I didn't think the conclusions were particularly scintillating.

The Bike Rack + Filter Coffee operation at Monroe Street Market in Brookland, next to the Metropolitan Branch Trail.  (What I like is that they have a public air pump outside.  More bicycle shops should do this.)

Bike cafes might be "new" to Washington, but there are plenty of cool examples around Europe (this article from Time Out London lists 15, "London's best cycle cafés") and even the US--some killer bike-oriented bars in Iowa of all places, according to the Des Moines Register ("Beers and bikes popular along High Trestle Trail" and "Windsor Heights bike hub could have cafe, art, music") etc.

Also see the Duvine story "Coffee Bikes and Beer Bicycle Bars and Cycling Cafes Across America" from 2015 and this NBC News story from 2011, "Bike cafés brewing in surprising places."

Food + retail is not new.  Kramerbooks and Afterwords Cafe, a bookstore-restaurant on Dupont Circle has been a premier example for decades.

Interestingly, in the early 1990s, Boogie's Diner, a food + apparel concept from Leonard Weinglass, founder of the now-defunct Merry Go Round clothing chain, opened in Georgetown but closed a few years ago.  However, the Aspen sibling of the long since closed combo stores in DC and Chicago remained open until a few months ago.

1.  Food yes, retail less.  I mention all the time that since people eat and drink everyday, but buy other goods, especially specialty goods infrequently, retail districts are shifting towards food as a majority of the "retail" storefronts.   This is abetted by a shift to e-purchasing of a wide variety of goods by the higher income demographics also most likely to patronize local shopping districts.

Sometimes I use the term eater-tainment districts to describe this.

Straight up retail can function, but only as a part of ever larger "regional shopping destinations."  At the neighborhood scale it's much harder to pull off, with notable exceptions.  In any case, it's much more boutique-y and the proprietor has to be satisfied with making a living, not getting rich.

Note that because of the shift to food as a greater proportion of "retail spending" narrow limits on the number of hospitality businesses that can locate in commercial districts as part of zoning regulations can be ill-advised, as it is hard to fill retail spaces with retail stores that don't exist (think of the destruction by e-commerce of various retail categories such as office supplies, travel agencies, camera shops, record stores, and bookstores to some extent.

I mention this because approvals for a restaurant in Cathedral Commons have been held up in part by a 20% limit on the number of restaurants in the development.

2.  Convenience retail can hold its own, other categories not so much.  Convenience retail, groceries and gasoline (impossible to purchase online), to some extent hardware and pharmacy, attracts customer who make frequent purchases.  Other retail does not.  E.g., I buy a bike every 4 to 7 years, and accessories infrequently, plus tune up and repair services, but I drink coffee or eat food every day.

I would still dude up much more the coffee bar at Sylvester & Co. in Savannah, but it provides a reason for people to visit the store every day.

So yes, adding coffee to a bike shop can make sense... just as it does for a variety of other retailers.

But plenty of retailers have been doing it for awhile, e.g., in a trip to Savannah years ago, I was impressed by an espresso bar at the back of Sylvester &Co. Modern General Store, a housewares store, and a coffee bar as part of the Paris Market store (clothing, accessories, and housewares), not to mention a coffee bar in a used book store.

Department stores like Macy's in NYC and Harrod's in London are known for the food halls, etc. Recently, Barnes & Noble announced they'd be expanding their coffee corners into more full blown cafes and Urban Outfitters bought an artisan pizza restaurant group ("Why Urban Outfitters Made Its Controversial Pizza Purchase," Fortune  Also see "Why fashion retailers are staging food experiences," from Business of Fashion.  From Fortune:
The move to buy Pizzeria Vetri, a pizza operator with just two locations in operation in Philadelphia, makes little sense at first glance. But analysts that weighed in on the results pointed out that Urban Outfitters and other retailers are suffering from a broader consumer shift in spending. People are spending less money on apparel, and more on trips, dining out and other “experiences.”

“Urban Outfitters has tested adding restaurants to select stores, and we believe these tests have proven successful, likely driving traffic and increasing the amount of time consumers stay in the stores,” said Stifel analyst Richard Jaffe. Jaffe added that there could be a great challenge of operating a new business to integrating it with what Urban already does.
Note that Ikea has long integrated child care areas and restaurants into their stores.

3.  Experiential retail. The trade publications are full of articles about how consumer interest is shifting to "experiences" ("The New Era of Experiential Retail," Stores) and retailers have to make their displays and approaches much more interesting as a result.  Another element is linking the bricks and mortar to digital commerce.

charlie shares with us this article, "Mall Owners Push Out Department Stores," from the Wall Street Journal, about how shopping centers are getting rid of department stores and replacing them with food and what we might call other "active retail" concepts where customers are likely to patronize these businesses multiple times in a week or month instead of a couple times per year.

4.  Social spaces as an element of commodified spaces and the experience.  Rather than just focusing on buying stuff, now customers are looking for spaces to be in and around stuff to buy.  That includes cafes within stores, places to sit, and fun and comfortable furniture, such as the chairs and sofas in places like Barnes & Noble or Starbucks, etc.  Such spaces will migrate to more types of retail stores.  How much of that will be digital as opposed to analog will be interesting to see how it plays out.  Shopping centers are doing this too, in the common areas inside and outside.
OC Mix at South Coast Collection
Outdoor area at the OC Mix at South Coast Collection in Costa Mesa, California.  Photo: Ana Venegas, Orange County Register.

5.  Bifurcation in retail chains between unique and standardized spaces.  I think this means that we'll be seeing more bifurcation of retail in terms of what is presented on the part of chains  Chain retail, which has focused on standardization, will split out a set of stores/companies that remain somewhat standardized, especially among the big boxes, like a Walmart or Best Buy, while another set will shift towards differentiated, creative, special retail.  It will trend higher end, e.g., Room & Board, and for higher cost items, e.g., Apple Store.

In some ways Urban Outfitters/Anthropologie has a been a leader in the differentiated/creative end of chain retail for awhile.  Same with how LAB Holdings in Orange County, California has developed unique retail concepts and centers ("Most Influential 2014: Shaheen Sadeghi led an independent revival in Anaheim" and "Can anti-mall and Packing House developer work his Midas touch," Orange County Register).

6.  Fast fashion/fast retail as experiential.  Another element of "experience" in retail might be the "fast fashion" category ("Fast fashion leader keeps H&M at bay," Wall Street Journal), where stores like H&M, Zara, and now Primark frequently change their apparel inventory on a daily and weekly basis to bring in new looks and colors, and to get rid of what isn't selling.  They price clothing relatively low, so that casual apparel segment has become somewhat disposable, rather than something you buy with the aim of wearing it for years and years.

The frequent change out of inventory makes it a form of experience retail because what's there today might not be there tomorrow and if you skip going to the store for a week or a month you fear missing out.  That's much different from the traditional four-season cycle of clothes marketing that had been practiced by by large retailers for decades, with spring, summer (bathing suits, outdoor apparel), fall (especially "back to school") and winter (coats etc.) being reliable boosts for sales.

But the

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8 Comments:

At 10:08 AM, Anonymous charlie said...

In Palma, I saw a pastry/coffee shop+homegood accessories+real estate agent shop, which is a pretty brilliant combo if you think about it. Not sure it would work completely but those real estate offices are pretty dead.

UPS and fedex are turning a lot of retail into drop off points.

Eataley is one big retail/restaurant confaburation. Shame it isn't coming to DC.


 
At 10:23 AM, Blogger Richard Layman said...

ING had some cafe-banks, first one was in Philly. Capital One, which acquired them has continued the concept, they just opened one in Carytown.

http://www.richmond.com/business/local/article_d5232b82-8895-52b5-b375-4be22d5b7651.html

Anyway, years ago I suggested that Staples have co-working spaces, and as you point out, being package pickup locations can give other businesses more walk in business.

BUT, the Parma combo you mention gives me another idea. Have a coffee shop/cafe be the anchor for supporting services type offices abutting, like RE office, accountant, chiropractor maybe, fortune teller, business center, etc.

Similarly, I've thought that grocery stores should include some space for convenience services like shoe repair, dry cleaners, postal services, etc. Adds one stop shopping and convenience but also supports other businesses and marginally adds repeat business since someone going to that cleaners is less likely to patronize a different grocery.

I mentioned in the past how some Navarro Hispanic-focused pharmacies in South Florida include a cafe and a business center.

2. Eataly no/not yet, but the Garces concept that will open in the Union Market district is similar. A Nordic one just opened up in Grand Central Station.

 
At 11:41 AM, Anonymous charlie said...

Supermarkets have long integrated banks (Safeway does this), dry-cleaning (safeway again). The new giant have bars, as does WF.

The various cell phone companies would probably also be candidates, not clear why they spend so much on their real estate.

 
At 11:53 AM, Blogger Richard Layman said...

this kind of cooperative space thing is likely a big opportunity.

Forgot about bank branches (although now many are satisfied with having an ATM), and yes, most big supermarkets sell stamps.

 
At 4:00 PM, Anonymous Anonymous said...

We "manufacture" almost nothing tangible in this country anymore except monetized "experiences" like shopping and tourism. And, despite the fact that we've offloaded many of the toxic processes needed to manufacture, even those experiential activities leave a tsunami of waste in their trails. This doesn't even touch on the totally unsustainable issue of energy use to maintain the built environment and get around in it.
There's a reason they refer to it as "consumption"... just sayin'...
-EE

 
At 9:18 AM, Anonymous Richard Layman said...

we still manufacture a lot, but mostly with machines and a bifurcation, low wage workers and high wage workers.

Like ag, it seems less central because fewer people are working within it, but it's sill substantive on a $ basis.

The funny thing though is how trade theory presumes that high end economies will export high end goods, and I don't know if you can count corn and wheat as high end.

2. But yes, lots of waste. We look at stuff, and say "landfill."

3. And waste of energy.

4. But what happened is that we moved from an resource efficiency focus of consumption (buy goods that last a long time, recycle "waste" products from the production system etc.) to a waste focus (throw it away instead of returnable).

 
At 7:30 PM, Blogger LongTimeRez said...

<>

For example?

<<...but mostly with machines...>>

No disagreement there. Jeremy Rifkin has been writing for decades about displacement due to automation.

<<...and a bifurcation, low wage workers and high wage workers.>>

No quibble with you there either.

<>

"substantive" for the benefit of whom?

<>

Why I'm an aficionado of Snepscheut's premise: "In theory, there is no difference between theory and practice. But, in practice, there is."

<< 2. But yes, lots of waste. We look at stuff, and say "landfill." >>

Frankly, I don't think most folks are that aware. The Japanese maybe... with their immutably small boundaries. At the end of 30 years heading up the Arizona Garbage Project, Bill Rathje concluded that our only hope was source reduction.

<<3. And waste of energy.>>

Yup... http://www.hydrocarbons-technology.com/features/featureenergy-gluttons-the-worlds-top-10-energy-consumers-4433940/

<<4. But what happened is that we moved from an resource efficiency focus of consumption (buy goods that last a long time, recycle "waste" products from the production system etc.) to a waste focus (throw it away instead of returnable).>>

No Sh*t, Sherlock! Totally unsustainable despite all of the techno-utopianism spouted by the powers that be.

--EE

 
At 7:55 AM, Blogger Sathya G said...


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