Revisiting older writings on the success of independent retail and neighborhood commercial districts

Sitting in the car at 15th and 15th earlier today ("Thinking about the opportunities for success with neighborhood commercial districts: comparing Manor Park in DC to 15th and 15th in Salt Lake"), I was thinking about my experiences around 2006-2008, when serving as a Main Street program manager in the Brookland neighborhood of DC (near Catholic University, with 12th Street NE as the spine of the commercial district) and in 2008, doing commercial district revitalization studies in Pittsburgh and the small town of Brunswick, Georgia.

The failure of some businesses in Brookland--seized by "opponents" to the Main Street program as proof of failure--as well as reviewing conditions in the Strip District, Lawrenceville, Penn Avenue Arts District, East Liberty, and Shadyside commercial districts in Pittsburgh led me to write three blog entries which still read quite well.

-- "The "soft side" of commercial district competition" (2006) jumps off from the concept of the Reilly Law of Retail Gravitation which I summarize as "people choose to shop at places with more and better stores."  

Retailers, especially independent businesses, need to think more broadly about both their business and their place as part of a commercial district, and they need to focus on those elements of the commercial district that influence perceptions of potential patrons.  From the article:

As long as a particular urban commercial district is deficient compared to nearby shopping alternatives, it won't be able to attract new customers, until it starts providing some decent options. You can put any kind of sugar coating on it that you want, but it's these factors that must be addressed: 

1. the quality and condition of the buildings
2. the cleanliness of the street and sidewalks
3. the condition of the street furniture, treeboxes and other aspects of the physical environment
4. the signage and windows of the businesses 
5. the quality and organization of the store interiors.

Points 4 and 5 aren't about the broader commercial district, but factors directly under the purview of the business owners, and I expanded on those elements in later entries.

-- "Why ask why? Because" (2007) was a response to criticism of the Main Street program when some businesses failed on the Brookland commercial corridor.  The point I made was that business failure needs to be understood not merely a declarative statement, and that a business support program can only do so much.  

The article outlines what a journal article called "retail mixes" but what I prefer to call retail store subsystems (using the concept of organizational subsystems as discussed in Social Psychology of Organizations by Katz and Kahn).    To the three mixes outlined in the article:

• goods and services
• communications
• physical distribution

I added:

• store operations

with the aim of helping retailers create more robust and successful business concepts and models.  The reason that the stores failed in Brookland had to do with weak systems and business models mostly, but also some certain stores needing a larger customer base (a/k/a "retail trade areas") than was proximate in the neighborhood.   From the entry:

The Rosenbloom article discusses the Trade Area Mix, linking broad market demand to the possibility of store (and commercial district) success: 

1. Trade Area Geography: the geographical extent of the trade area
2. Trade Area Demand: the level of consumer demand within the geographically delineated trade area
3. Trade Area Heterogeneity: the mix of consumer market segments within the trade area and the diversity of consumer demand for products and services. The greater the demand, the higher degree of heterogeneity, characterized by more offerings.

When someone says "That store closed, the X commercial district is a terrible place to do business," the reality is a lot more complicated. Was it the owner [and management]? The concept? The commercial district? The property? Access to capital? 

And it's not either/or, it can be and/and/and... For example, the Brookland commercial district has some significant spatial and access issues. Just like I write about "intra city sprawl," commercial districts need to ensure intensity and critical mass.

-- "Indepependent retail businesses can succeed and thrive" (2008) outlines elements of robust retail business concepts and identity systems, extending concepts laid out in Designing Brand Identity.  (Although this table is updated, from the 2009 blog entry, "Retail and Restaurant Check Up Surveys.")

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Principles for creating complete concepts/identity systems for retail businesses*

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Overall

• Understand the needs, preferences, habits, and aspirations of the target audience. 

• Experience and study the competition and learn from their successes and failures. 

• Understand traffic flow, the volume of business, and economic considerations of your location. 

• Create an experience and environment that makes it easy for customers to buy, and that inspires them to come back again and again. 

• Good design sells. It is a competitive advantage. Design is systems and processes, not just graphics. 

• A disciplined, coherent approach leads to a unified and powerful brand presence. 

• Create a distinct position and complete identity for your store/concept. 

Facade/Exterior

• The storefront is a mass communications medium that works 24/7 and can attract new customers, influence purchasing decisions, and increase sales. 

• Logo and signage expresses the brand and builds on understanding the needs and habits of users in the environment. 

• Exterior signage must consider both vehicular and pedestrian traffic. 

Interior

• Design an interior space that is sustainable, durable, easy to maintain and clean, and is energy efficient.

• Consider the dimensions of space: visual, auditory, olfactory, tactile, and thermal. 

• Understand the psychological effect of light and lighting sources. 

• Align merchandising strategies with displays, advertising, and sales strategies. 

• The shelf is the most competitive marketing environment that exists. 

• Consider the needs of handicapped customers and those of different ages. 

Service/Business operations

• Consider all operational needs so that the store delivers on the brand promise. 

• Create an environment that helps the sales force sell and makes it easy to complete a transaction. 

• Align the quality and speed of service with the experience of the environment. 

• Benchmark the quality and speed of service against the competition. 

Plan for the future

• Anticipate future growth. 

• Measure, evaluate, change. 

• Constantly ask: is the message clear?; is the content accessible?; is the experience positive?