Tag Archives: shopping

Transitioning a glittering downtown shopping mall to a more experiential space

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Water Tower Place on North Michigan Avenue has fallen on hard times, as have many malls, and plans are underway to revive the property with new uses:

In consultant-speak, today’s juice is “experiential” retail. It means that people not only want something they haven’t seen before, but they want an experience to go along with their purchase. The Apple Store and the Starbucks Reserve Roastery further south on Michigan Avenue are examples of that — places where shoppers come to see and feel as well as to buy. A pop-up show called the “Dr. Seuss Experience” filled Macy’s former space in Water Tower Place this winter. Down the street, a “Museum of Ice Cream” is opening at the base of the newly renovated Tribune Tower this summer…

But she and her colleagues are already thinking big. A report titled “North Michigan Avenue: Strategies for a Vibrant Future” issued in March by a group of business and city leaders envisions a grand promenade running from the historic limestone Water Tower, past the Museum of Contemporary Art, to the lake along Chicago Avenue; and a soaring pedestrian bridge stretching from Michigan Avenue, over DuSable Lake Shore Drive, to Oak Street Beach. The bridge, modeled on a structure in Moscow, would make it possible to see and get to Lake Michigan from the Mag Mile without descending into dank tunnels under the beachfront drive.

Also in the report: a more run-of-the-mill property tax on landlords raising about three quarters of a million dollars passed the City Council this year; it will be used for cultural events like “Music on the Mile” and for security cameras. The city also awarded Bares’ group money from a federal grant to deploy a team of uniformed “ambassadors” — unarmed security personnel with radios to help tourists, assist the homeless and report criminal activity on the Mag Mile — starting in June.

But most of the report is focused on getting people excited about going downtown to enjoy attractions such as music, art and culture, and Water Tower Place recently scored its own big get on that front. In April, the world-renowned Hubbard Street Dance Chicago surprised everyone and moved from a temporary home on the North Side into the mall’s fourth floor.

For years, shopping in a lively context was enough “juice” to bring in both serious shoppers, curious shoppers, and other visitors. Shopping was one of the most popular activities for Americans and the glamor of a downtown mall plus at least a decent-sized crowd would make it feel exciting.

Now that shopping is decoupled from physical space, these former shopping spaces do not have enough “juice.” They need more experiences, ranging from music to arts to unusual sights to places where people can post intriguing social media images.

Can cities and communities be flexible enough to shift spaces and experiences? And how many experiential areas can there be? On the first question, communities need to open to how spaces might be used in different ways when conditions change. Shopping malls may have worked for decades and brought in significant revenue, but when they struggle, what is next? For the second question, Chicago already has some of these experiential spaces: Navy Pier, the Museum Campus, a Riverwalk, and other concentrations of interesting activity. Can these work together in that a visitor could access several of these in a single day or trip or at some point do they start competing against each other?

The decline of in-person shopping is a big deal and a shift that many communities are struggling to address. Those who find successful alternative uses for these shopping spaces and also develop a mindset of needing to refresh certain places may just come out ahead.

Finding the mean, median, and modal Walmart shopper

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An analytics firm describes the “typical” Walmart shopper:

Photo by Michael Burrows on Pexels.com

Numerator found that Walmart’s typical shopper in the US is a white woman between 55 and 64 years old, who is married and living in the suburbs of the Southeast. She typically has an undergraduate degree and earns about $80,000 per year.

She visits Walmart at least once per week — about 63 trips per year — and picks up 13 products for a total cost of about $54 per trip. 13.5% of her spending takes place at Walmart, while she spends about 11% at Amazon.

Her primary shopping categories in-store are groceries, including chicken, fruit, snacks and sweets, but she also gets a lot of fast food. Her favorite five brands at Walmart are Turkey Knob, Cheetos, Betty Crocker, Dole, and Tyson.

I am always looking for examples to help illustrate the differences between the three primary measures of central tendency: mean, median, and mode. When an article or report says something is “typical,” what exactly do they mean? Here is my guess at which data above is which measure of central tendency:

-mean: age, education level, visits to Walmart, money spent per trip

-median: income

-mode: race/ethnicity, marital status, place of residence, what is purchased

Some of these are harder to guess or do not fit these three options well. For example, is the $54 per visit a mean or median? Or, the five favorite brands are not a singular mode and they may lead the list of brands but not actually comprise that much of the total percent of purchases.

Additionally, it would be interesting to add measures of variability. How much variation is there in the age and education level of Walmart shoppers? I would guess the company wants to know more about the $54 spent per trip; how many spend more and what could be done to increase the number of people who spend more? Throw in a standard deviation or some other measure of dispersion and the numbers above become much more interesting.

In the end, the report above does not mean that someone visiting a Walmart will find most shoppers fit that profile. The measures of central tendency here tell us something but using multiple measures plus some measures of variability would provide more in terms of revealing who is at Walmart.

Amazon rediscovering department stores?

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Amazon’s online empire is vast but it is also expanding its brick and mortar operations with plans to open department stores:

Photo by Artem Beliaikin on Pexels.com

What solves all of these problems—the high return rates, the cost-prohibitive last-mile freight, the logistics nightmares, the buyer frustration, and the monumental volume of consumer waste it all sends to landfills—on some level? Stores. Going to a store. In America especially, this notion was obvious for more than a century. Department stores were actually such a good idea, something that people like so much and that works so well, that the Gilded Age barons who invented them used their stores to create middle-class identity from near whole cloth and keep it going for generations.

Amazon helped kill most of those stores, but that has only created a vacuum into which more Amazon products and services are ready to be inserted. If Silicon Valley has taught us anything in the past two decades, it’s that if you have a bottomless pit of money, you can remake an industry in your image. You can acquire customers so quickly that they might not realize they don’t totally love everything you’re doing, and you can embed yourself in their lives in ways that would be tangled and inconvenient to remove, largely by snuffing out competition. Which leaves the retail industry in a precarious position: Amazon, and maybe a handful of its largest competitors, will go about deciding how you get to buy the things you need, with very little meaningful pushback. They’ll set prices, they’ll set labor conditions, and they’ll decide which things are too inefficient for you to buy online. Apparently, those things will go into a store.

Amazon and the companies like it invent the solutions to the problems they created, and you pay for them to be implemented. At least in some cases, physical stores may ultimately win out. You can try on your new pants, sit on your new couch, and leave with the thing you wanted immediately, which, it should be noted, is considerably faster than two-day delivery. Yes, you have to go to the store, but doing so will likely obviate the need for you to go to the post office—the dreaded post office—next week. Work smarter, not harder. It’s what Amazon would do.

A physical location offers certain conveniences. But, do not discount the embodied experience of shopping compared to online shopping. In a building, you can:

  1. See and possibly touch the item you want to purchase. This may matter more for some consumer goods than others.
  2. Browse and bump into things – literally. You can end up following rabbit trails online but this is different than seeing something unexpected or just look around.
  3. Be around other shoppers and enjoy the atmosphere. I wrote about this at Christmas; part of the fun is being around people and activity.
  4. Physical spaces can project status and emotions in ways that online portals cannot. The size and layout of department stores can impress and invoke particular feelings. Would you rather think about a soulless and endless Amazon warehouse or a fashionable and high-tech store?

Of course, some of these things can go awry. The item might not be in stock, you do not find what you are looking for, you have negative experiences with other patrons, and the experience is off-putting rather than exciting. But, Amazon might be at the point where they can offer compelling experiences in both realms in ways that others could not.

Missing the collective effervescence of Christmas shopping this year

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Americans like shopping. And this year, even amid COVID-19, the shopping will go on. But, it will take a different form for many as the busy stores and shopping malls will be replaced by online shopping and shopping trips intended to avoid contact with people.

There are two components to shopping at Christmas time. First, Americans generally favor consumerism and can make commodities out of lots of things. Second, shopping can involve being around other people. In a large society where private lives are the norm, shopping near people in an excited holiday atmosphere feels like being part of something bigger. Even if you have no interactions with anyone else outside of your shopping group, simply being in the same time and place can be exciting.

Just as religious rituals can produce collective effervescence according to sociologist Emile Durkheim, so too can Christmas shopping. It may be based on consumerism, have no touch of the transcendent, and involve no direct social interaction with other people. Yet, shopping at Christmas is a different kind of experience than shopping for different kinds of items at different times of the year.

Shopping online produces no such collective effervescence. A person and a screen. The social energy is limited. Of course, one could head to social media to share their online shopping exploits. But, it is not the same as being physically near to other people in a space designed to push you toward Christmas cheer and more spending.

American battle: weirdness vs. wealth

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In a closer look at what is happening to retailers in New York City, Derek Thompson suggests two contrary forces are at work in urban America:

A war is playing out in American cities between wealth and weirdness. The former encourages the pursuit of national trends and national brands—high-end fitness studios adjoining Sweetgreen franchises—for the purpose of maximizing profit on a per-lease basis. That spirit runs counter to the desire for diversity and experimentation, which requires policies that actively promote the survival of small companies in an economy that would otherwise eat them up.

I would suggest this goes further than just big cities. One could argue this is a larger battle fought since at least the end of World War Two involving revered ideals in American culture.

On one side are the powers of standardization, efficiency, predictability, and national chains. Think the rise of McDonald’s, Walmart, and Google. These companies came to represent whole sectors of business and their actions helped lead to predictable user experiences and outcomes across different geographic contexts. They are good at efficiency, offering customers a cheap service while turning out billions in profit.

On the other side are the powers of small businesses, entrepreneurs, diversity, and American individualism. Think the quirky and interesting shopping districts that attract visitors. Many of the establishments offer unique experiences that are difficult to replicate elsewhere. Think businesses that reflect the traits of their owners. These are people trying out ideas and participating in the local community. Non-conformity and cool are still sought after.

Both of these types of businesses reflect American ideals. Many of the national chains we know today started as the more unusual business options that became wildly successful. Some owners and founders want to remain small and others want to try for everything they can get. Obtaining a good balance of these approaches is likely hard to do from a policy level.

What was present and missing from my peak suburbia drive to Costco

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A few days ago, I picked up a few family members and we visited the nearest Costco (utilizing one of their memberships). One family member remarked this may have been a peak suburbia experience – and they may be right for several reasons:

  1. We traveled in a minivan. We didn’t necessarily need all of that space but it could have proved useful at some point.
  2. We stopped at McDonald’s along the way. The minivan went through the drive-through, a common American occurrence.
  3. We traveled to a quintessential big box store: Costco. The store was crowded, we browsed for over an hour, and we purchased a good number of items.

At the same time, we missed a few elements of a truly peak suburban experience:

  1. The trip to Costco was not sandwiched between a kid’s activity. Put a pick-up from preschool at the beginning and a travel to a lesson or sports practice at the end.
  2. The crowds and traffic were not too bad because of the time of day we went to Costco. Instead, make this all part of a evening commute between roughly 3:30 PM and 6:30 PM.
  3. While we certainly purchased items that we did not need, I would not say that we mindlessly consumed on bulk items. Most or all of the items had a justifiable reason for their purchase.

The combination of driving in a large vehicle for consumption purposes among a semi-dense landscape…is this what Americans dream of when choosing to live in suburbia?

When bricks and mortar stores can’t make it even in Manhattan

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Heart of one of the world’s leading global cities, Manhattan has its own struggles with keeping brick and mortar retailers in operation:

That’s right: On a nine-block stretch of what’s arguably the world’s most famous avenue, steps south of the bustling Time Warner Center and the planned new Nordstrom department store, lies a shopping wasteland.

Yes, there are bank branches, restaurants, fast-food outlets, theaters, Duane Reades, a vitamin shop and a few tourist-targeted “discount” stores. But mainly there are oodles of empty spaces covered with signs touting SUPERB CORNER RETAIL OPPORTUNITY.

The same crisis blights the rest of Manhattan. The people invested in storefront retailing — real-estate developers, landlords and retail companies themselves — tell us not to worry. It’s a “transitional” situation that will right itself over time. Authoritative-sounding surveys by real-estate and retail companies claim that Manhattan’s overall vacancy is only just 10 percent.

But they are all wrong. Bricks-and-mortar retail is shrinking so swiftly and on such a wide scale, it’s going to require big changes in how we plan our new buildings and our cities — although nobody wants to admit it.

This is an interesting argument to make: even with all of the tourists, wealth, and attention bestowed upon the borough, retail is disappearing from Manhattan. And if shopping disappears, with shopping being one of the favorite leisure activities of Americans, might this negatively affect the business and social life of a Manhattan used to ultra-busy sidewalks?

On the other hand, Manhattan may not be the best example. The median household income in Manhattan is not as high as one might expect, there is not much of a middle class, and the cost of living is high. Add in that Manhattan does have a lot of tourists, workers that arrive for the day and leave at night, and concentrations of residents in different parts of the island. The sheer density of people might suggest that retailers should be able to make it in Manhattan but it is a complicated place.

More broadly, what will tourist locations of the future look like if even more shopping is done online? For decades, the international tourist destination includes significant amounts of shopping. What would fill that space?

A fast lane for walkers in a Liverpool shopping complex

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Fast movers get their own walking lane in a new experiment outside Liverpool stores:

Argos has painted new markings on the pavement outside its Liverpool store after research revealed almost half the nation found the slow pace of high streets to be their biggest shopping bugbear.

The new lane, being trialled this week in the Liverpool One shopping complex, hopes to help pick up the pace for those who are hurrying by bypassing the crowds.

New statistics show 31 per cent of people find pavement hoggers frustrating, while more than a quarter (27 per cent) get annoyed by dawdling pedestrians…

‘As the research demonstrates, a faster high street could vastly improve the overall shopping experience for British shoppers across the UK.

As a fast walker, I approve. However, I envision multiple problems arising:
  1. The speed of fast walkers could vary quite a bit from each other. Various people could be moving faster than the general population but still not be moving fast enough for others in the fast track.
  2. What happens when people inevitably wander into the fast track without knowing?
  3. Where is the proper entrance and exit ramp on this track? This isn’t exactly like a moving walkway that has a clear beginning and end. Come to think of it, why not install more moving walkways that can help everyone move faster through a main corridor like this? (It does look like this is an outside setting so that’s an issue.)

How long can this experiment last? While there are a lot of pedestrians on many city streets, I’ve never seen fast lanes like this before.

Shopping malls adapting with new purposes and targeted groups

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Joel Kotkin argues shopping malls aren’t dead – they’re changing their purpose and targeting wealthier and ethnic consumers.

To be sure, there are hundreds of outmoded malls, long-in-the-tooth complexes most commonly found in working-class suburbs and inner-ring city neighborhoods. Some will never come back. By some estimates, something close to 10 to 15 percent of the country’s estimated 1,000 malls will go out of business over the next decade; many of them are located in areas where budgets have been very tight, with locals tending to shop at “power centers” built around low-end discounters such as Target or Walmart.

But the notion that Americans don’t like malls anymore is misleading. The roughly 400 malls that service more-affluent communities—like those typically anchored by a Bloomingdale’s or Nordstrom—recovered most quickly from the recession, and now appear to be doing quite well.

To suggest malls are dead based on failure in failed places would be like suggesting that the manifest shortcomings of Baltimore or Buffalo means urban centers are not doing well. Like cities, not all malls are alike.

Looking across the entire landscape, it’s clear the mall is transforming itself to meet the needs of a changing society but is hardly in its death throes. Last year, vacancy rates in malls flattened for the first time since the recession. The gains from e-commerce—6.5 percent of sales last year, up from 3.5 percent in 2010—has had an effect, but bricks and mortar still constitutes upwards of 90 percent of sales. There’s still little new construction, roughly one-seventh what it was in 2006, but that’s roughly twice that in 2010.

In other words, shopping malls today can’t afford to try to target everyone at once. Rather, the retail market has both exploded with opportunities and fragmented, meaning that malls and other retailers have to target particular groups. This is going to be easier in areas that have money or lack other retailers or have growing populations.

Of course, Kotkin isn’t particularly worried that shopping malls are taking over the Main Street function for suburbs and other communities. There are issues with this: this is privatized space that often requires a car to get to and its primary activity is consumerism. Indeed, if people focused on activities other than shopping (which remains a very popular activity), our version of  capitalism might ground to a halt:

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Still, many communities will be happy if shopping malls continue as they are economic boons through sales taxes and jobs.

Shopping malls have to renovate and adapt in order to survive

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Even successful shopping malls like Woodfield Mall in Schaumburg have to innovate in order to stay relevant:

With shopping habits having been permanently reshaped by memories of the recession and the availability of new technology, traditional malls like Schaumburg’s must find new reasons for people to make the trip, said Phyllis Ezop, president of Ezop and Associates, a business strategy and marketing information firm in La Grange Park…

The factors that seem to separate the two categories are location, demographics, the strength of tenants and the availability of other amenities, such as restaurants and movie theaters, that can make the mall more of a destination, Stern said…

With the rising popularity of the largely outdoor lifestyle center, Woodfield’s 44-year-old indoor structure is especially challenged, Stern said.

One Woodfield’s negatives that a cosmetic renovation is unlikely to fix is its split-level nature. This makes the mall harder to navigate for the shopper and causes some spaces to be better than others for the tenant, he said…

“They need to have destinations there,” Aron said. “I really see it going in that direction. You can order things online, but you can’t have a great dinner online.

I’ve seen this idea in numerous discussions of planning, whether thinking about reviving a downtown or a shopping mall or a tourist locale: potential visitors need a destination, something unique to get them there. In this sense, Woodfield already is ahead of the game: it is one of the largest malls in the United States, has over 2 million square feet of retail space, and companies located there treat it as an important location (flagship stores, special concepts, etc.). But, it is not guaranteed that people will continue to visit shopping malls. These days, the hook seems to be entertainment. Sure, the mall has shopping but eating, movies, special events, and unique spaces offer entertaining experiences.