As Bob Dylan said, “the times they are a-changin’” and I believe that’s always true, especially for the retail industry. At a time when headlines are proclaiming a retail apocalypse, we must recognize that changes have been occurring for decades.
Years ago, trade was conducted downtown in multi-level department stores and flagship retail showrooms. I was recently reminded of this while looking at photographs of Havertys’ iconic downtown buildings—it’s nostalgic to see those iconic blade signs. Customers flocked to the hustle and bustle of the big city to do their shopping and to see the exciting new offerings. But as time passed with a growing suburban population, developers began building enclosed suburban malls on the fringe of residential neighborhoods, ultimately reinventing the town center, while moving the shopping destination closer to home. The mall became the new place to dine, see a movie, and visit the local department stores (usually there were at least three) to see the latest fashions. While not quite recreating the downtown atmosphere, it certainly captured a bulk of the retail dollars for years to come.
As we moved into the new millennia, the changes kept coming, much like Dylan’s hit song. Amazon sold its first book online, Apple’s iPhone was created and Facebook became a worldwide sensation, setting the stage for a major shift in consumer behavior. For example, open air lifestyle centers became popular along with a live, work, play mentality. Retailers clustered around park-like settings, municipal buildings, office space, and apartments meant we could shop and spend along streetscapes similar to our grandparent’s experience downtown.
Today, we are seeing the fallout as brands try to adapt to changing entertainment and experiential trends of the millennial shopper, as well as that much-discussed elephant—competition online. However, the retail spend is still there, growing faster online at this point, but many sticks and brick segments are showing positive trends.
For example, movie theaters like Alamo Drafthouse are packed with new dine-in and drink-in features, fast casual restaurant concepts like Corner Bakery are continually tweaking their offering (and now could be the anchor of the neighborhood strip), and treasure hunt retail stores such as Tuesday Morning and Home Goods provide shoppers with a reason to keep coming back into the store. Active play and other entertainment venues such as Main Event now are the go-to place for birthday parties and corporate events.
Is retail changing? Surely. But what’s new? It always has been. Visionary developers, creative retailers and the next generation of customers will lead the way, and it won’t be entirely digital.
Mark Reeder is executive vice president and Dallas market leader at SRS Real Estate Partners. Contact him at [email protected].
