Retail companies continue to shutter stores across the U.S. with Sears, JCPenney, Staples, Kmart, Macy’s, Gymboree and Gap the latest to make the news.
As commercial and retail property owners, in the wake of apocalyptic headlines comes a fresh wave of questions, and this one always tops the list: “Are you worried that shoppers will shift their consumer spending habits to entirely e-commerce?” The answer is, “No, our tenants are thriving in both spaces.”
But we cannot afford to be complacent. The shift in consumer behavior is forcing property owners and tenants to market differently and to provide memorable experiences over an impersonal buying process.
The surprise partnership of Amazon and Whole Foods Market generated tremendous buzz around the future of home grocery delivery services and makes a powerful statement about Amazon’s strategic growth into physical stores.
As the owner of several shopping plazas that include grocery anchors, we are keenly aware of retail’s underachievers and leaders. Every property owner wants to fill their spaces with robust retail players who have staying power. More than 40 percent of our tenant mix is small business, which adds diversity and bench strength to our plazas.
In spite of negative retail headlines, there is a countertrend and an encouraging new truth that ushers in brick-and-mortar opportunities. In 2017, more retail stores are opening than closing according to research firm IHL Group.
Technology is not the only reason, but it “accelerated the decline of retailers who have not been in touch with what their consumers wanted as much as their competitors. Technology helps consumers see more of what’s available and that makes the comparison between brands so much more stark and apparent,” says Richard Ketchenbaum.
Online brands like Warby Parker, thredUP, and UNTUCKit are going physical to add to the shopper experience.
We see tremendous opportunity for ownable moments in retail, especially for regional centers like the West Shore Plaza and Silver Creek Plaza on the Pike. We consider ourselves a third space — a gathering place beyond work and home. A quick glance at the West Shore Plaza Facebook page, and you’ll read about families creating memories at our stores.
Today, we are providing a third space for new generations like the automobile enthusiasts who meet to show off their restored cars at the West Shore Plaza Family Restaurant and where grandfathers bring their grandsons for their first haircut at the West Shore Plaza Barber Shop, celebrating 60 years in 2018. We love the internet’s immediacy and the insights it provides, but you still can’t get a haircut online. Brick-and-mortar stores that harness data and build relationships from social media have an advantage because they connect with customers on the screen of their choice while still offering a shopping experience that engages the five senses.
For the past eight years, we have developed emotional connections with our shoppers through social media, visual content campaigns and special events. As competition grows stronger to attract the best customers and shoppers, we have invested significantly in offering tenants a platform to tell their story. We have created several prized ownable moments — events of significance that the West Shore Plaza is known for, including our month-long Small Business Saturday celebration each November and our brand-new Wicked Spooky Party Trick-or-Treat community event for families and pets on Oct. 24.
Through our ownable moments, we have become a champion for small businesses who need secure and affordable space to start and grow their business, and we’re proud of the number of women-owned businesses that call the West Shore Plaza home. The engine of our economy is jobs and, interestingly, more than 60 percent of our economy is powered by small business, the job creators. Real growth multiplies when entrepreneurs like Elena Macris lease a high-traffic and affordable retail space to start a chocolate business, Neato Burrito finds the right vibe and customer mix to open a fresh-made burrito shop, and jewelry designer Kristin Novinger creates world-class artisan pieces and celebrates her fifth year in business. Luxury spa services from Polished Salon, Spa, and Wellness add to the Plaza’s experiences.
Our ownable moments harness the power of technology to create a stronger bond with our community partners, too. We are especially passionate about supporting the Four Diamonds and THON and join the fight against pediatric cancer, and assisting The Salvation Army Harrisburg Capital City region with the Red Kettle campaign. We believe small business thrives with a property owner who understands that “Commitment to Community. Opportunities for Enterprise.” transcends retail disruptions.
Last year, we supercharged our #WSPShopSmall event and created a statewide campaign asking Gov. Tom Wolf to issue a proclamation declaring November as #ShopSmallPA month in Pennsylvania. Standing on the Harrisburg State Capitol Rotunda steps, we became the voice of small business with a unified message of “Powering a Prosperous Economy in the Keystone State.” Several of our small-business tenants shared their stories with the media.
We were joined by state Sen. Mike Regan (R-Cumberland/York), the National Federation of Independent Business, Pennsylvania Bankers Association, the U.S. Small Business Administration, Harrisburg and West Shore chambers of commerce, and the deputy secretary of the Pennsylvania Department of Community and Economic Development. We highlighted the economic value of a small business in Pennsylvania and its tremendous contributions to a retail center. It was a special ownable moment for our tenants and an enthusiastic call for renewed support of our job creators.
Commercial real estate is more than a fixed-asset business, it’s a community service business. We understand the role we play in our region’s economy, and we look forward to investing in more ownable moments to strengthen the intersection of e-commerce and retail.
Richard E. Jordan II is CEO of Smith Land & Improvement Corp., headquartered in Cumberland County. He can be reached at firstname.lastname@example.org.