On Wednesday, November 16th, we held our first-ever Placer Discover virtual event. Over 1000 attendees tuned in to listen to fascinating discussions featuring leading experts and covering a wide range of topics, from the evolution of the shopping center to the future of data. Below are some of the key insights from the conference. You can watch the full videos by registering here.
1. Brick and mortar is making a comeback
“We all got a brief window into the mostly online world and it was pretty boring and flat, and we all craved to be out of it pretty quickly.” (Stu Biel, SVP, Regional Leasing, Federal Realty Investment Trust)
“Commercial real estate has a bright future ahead” (Elizabeth Boldin Thomas, Director of Marketing & Research Strategy, Bayer Properties)
Pretty much all the speakers agreed that 2021 has disproved the “offline retail is dead'' narrative. From the fact that consumers continued looking for ways to shop in stores during the lockdowns despite the risks of infection and the availability of digital channels, to the speed with which consumers returned to stores once they re-opened, to the numerous digital brands (including Amazon) that have been making sizeable investments in brick and mortar retail, all our panel experts were incredibly optimistic about offline retail’s potential going into 2022.
2. Brick and mortar retail is critical to community building
“COVID proved that physical shopping is so important to our society” (Chris Ressa, COO, DLC Management)
“Bringing people together is a key role that retail plays in our communities” (Ashley Lloyd, SVP, Marketing & Principal, SRS Real Estate Partners)
Many speakers spoke of the important role that retailers play within their communities. Retail brings people together in the physical world and provides people with an opportunity to socialize. Retailers need to be attuned to the communities in which they are operating and make sure that the product selection, experience, and customer service offered is in line with the needs and expectations of the community it wants to serve.
3. Customers are expecting more from retailers, and brands need to keep up
“The consumer has so much more power now over the brand experience” (Ashley Lloyd, SVP, Marketing & Principal, SRS Real Estate Partners)
“The biggest change that we’ve seen [since the pandemic] is retailers having to adapt to a more informed consumers” (Pablo Gonzalez, VP Sales & Marketing, Synergos Technologies)
Retailers and CRE professionals are not the only ones with more access to data – consumers are also better informed than ever before, and retailers need to cater to that. Consumers today often do a lot of research before making a purchase, and retailers need to make sure that the information they need is available to them – whether the consumer wants the information online or offline.
4. Online and brick and mortar channels need to work together
“The data shows that there is this harmony between physical and online. It’s not an either-or. They’re not working against each other.” (Daniel Taub, SVP, National Director – Retail, Marcus & Millichap)
“Retailers who are able to execute both [online and offline] channels well are the ones who are successful.” (Alex Bord, Director of Real Estate, Wild Fork Foods)
Many of the panel participants spoke about the need for retailers to integrate their online and brick and mortar channels to ensure that they work together and complement each other. Brick and mortar stores are key to brand building, and physical stores also play a critical logistical role in bringing down the costs of customer acquisition and returns. Meanwhile, digital channels can be an important driver of foot traffic to physical stores. Several participants on different panels also emphasized that convenience is not exclusive to digital channels – convenience means that the customer can purchase the product however is convenient from him or her on that day, which may mean driving to the store and picking it up. The continued growth of omnichannel is one testament to the success retailers can have when they look to their digital and brick and mortar channels to complement, rather than compete with, each other.
5. COVID has created a lot of opportunities for retailers and CRE professionals
“This chaos has created a lot of opportunities” (Dale Goss, Senior VP, Real Estate, Raising Cane’s)
“There are big opportunities if landlords and developers take advantage of the new value proposition of brick and mortar” (Elizabeth Boldin Thomas, Director of Marketing & Research Strategy, Bayer Properties)
While COVID is often portrayed as a disaster for retail, several CRE, retail, and dining experts agreed that the pandemic has actually also created many opportunities for brands that knew how to seize them. Whether being active in the CRE space in the early COVID days and managing to secure particularly valuable properties, or offering exceptional customer service and increasing long-term customer loyalty, or CRE landlords and tenants re-thinking their organization of physical space so as to stand out and draw more customers, many participants agreed that the brands and shopping centers that looked and seized opportunities over the pandemic have positioned themselves for long term success.
6. Brands that want to succeed need to continue to innovate
“The pandemic has really pushed people to think – ‘in an ideal world, what do they want from retail?’” (Deborah Weinswig, CEO & Founder, Coresight Research)
“The pandemic is going to force innovation” (Davon Barboud, Vice President of Advocacy & Economic Development, Hollywood Partnership)
The pandemic forced many retailers to think outside the box – and several panel participants expressed the hope that retailers and shopping centers will continue to innovate without being forced to by COVID. Many speakers across different panels agreed that COVID accelerated trends that were already in place, including the decline of certain legacy brands that were resting on their laurels and not innovating. Post-covid, there may be fewer brick and mortar stores and dining establishments, but there will be more properties offering innovative and experiential concepts that cater to the 21st century consumer. Several participants also spoke about the change to residential spaces that COVID precipitated – as hybrid work continues, consumers will start expecting more of their residential area – and companies that know how to innovate will be well positioned to cater to these changing preferences.
7. Retailers and landlords should work together for the benefit of everyone
“I’m hopeful that the acceleration of these trends will bring more of a partnership spirit between the landlords and the retailers so we can work together to provide consumers more service, better information, and more convenience” (Tommy Miller, Managing Director, CIO Trademark Property)
“If we learned something in the pandemic, it’s the codependence between the owner of the shopping center and the tenant that’s inside the shopping center.” (Sandy Sigal, CEO & President, NewMark Merrill)
The pandemic led to unusual levels of cooperation between landlords and retail tenants that developed over the pandemic. The shutdown of non-essential retail and subsequent gathering restrictions affected both landlords and tenants and forced them to work together to weather the COVID storm by sharing information and showing flexibility with each other. The large increase in the availability of third-party data such as Placer.ai’s is also making it less tenable for retailers and landlords to keep information from each other. Several CRE professionals expressed the hope that the cooperation between landlord and tenant will continue post-pandemic, which can benefit landlords, tenants, and consumers.
8. Data has changed the retail and CRE game
“Data can’t give the right answer, but it can lower the zone of uncertainty so that you can have confidence” (Gary Menger, President, AGS)
“Mistakes are expensive and competition is fierce, so we really need to make informed decisions – and the more data and information, the better.” (Carol Schillne, National Retail Tenant Rep, Keyser)
CRE experts, retailers, tenant representatives, and civics professionals all agreed that the widespread availability of data has revolutionized their decision making. Data democratizes site selection, reveals consumer preferences, shows whether a strategy is working (or not), and helps predict outcome. Data is critical across the board, including in smaller markets where the value of a deal or the potential outcomes of a business decision is almost impossible to assess without the right data.
9. Data alone is not enough – it needs to be usable and actionable
“There is a ton of data out there, but what’s important is taking the data so it helps drive decision making” (Dale Goss, Senior VP, Real Estate, Raising Cane’s)
“We’ve got so many [data] tools, but they don’t matter if you can’t apply them” (Ashley Lloyd, SVP, Marketing & Principal, SRS Real Estate Partners)
“Data is important, but actionable data is vital” (Chris Ressa COO, DLC Management)
While everyone recognized the importance of data, everyone also agreed that the lack of data was not the issue today. On the contrary, most participants discussed how easy it is to find data today, and how much harder it is to use most of the data out there in a way that can effectively and efficiently drive decision making. With the proliferation of data and data sets, speakers from across the board admitted that the challenge today is to digest all the different data streams to use it and present it to clients in a meaningful way – and so the best data products are the ones that tell a clear story and can support clear decisions.
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