We are at the intersection of the world’s two largest generations crossing over in dominant influence. Millennials have surpassed the super consumptive Baby Boomers as the largest population base in the world and will be the prime consumers in the future. Millennials clearly behave differently— a material, disruptive change, challenge, and opportunity with significant implications for our consumption driven society. More so than ever, retailers and retail properties must meet the consumer how, where, and when they want to be met — over their phone, computer, landline, and most importantly, in person.
At the same time, shopping centers must continue to adapt as they fit the marketplace. Whether as experiential districts with pocket parks and other engaging social experiences, or last mile distribution hubs with quick in-out capacity. Certain constants will always remain in force — the intersection of high-density traffic and disposable income will continue to be invaluable. As such, high traffic, particularly walkable urban locations, where retailers can ideally express their brand and access their core customer will be the premiere shopping districts for their respective communities.
The winners in retail are and will continue to be those who have the best in-store experiences and omni-channel strategies. Apple, Amazon, Walmart, Home Depot, and Best Buy are great examples. Digital native brands developing brick and mortar platforms, such as Bonobos, Casper, Outdoor Voices, Warby Parker, and those retailers adapting their business, will succeed, and those that do not are going to continue to face severe challenges. At the same time, those that only have a digital strategy will need to open physical stores as well. Retail stores remain more than relevant, as they are the portals to effectuating change and enable invaluable interaction between the retailer and the consumer. Stores provide retailers the best opportunity to express themselves and provide the touch point for the experience, the personalization, and of course, the cheapest and most efficient form of distribution. In fact, it is more likely than not that Amazon/Jeff Bezos will ultimately be one of the largest owner of bricks-and-mortar stores and real estate in the world. Give that some thought.
Steve Lieberman is CEO of The Retail Connection.