LAS VEGAS—GlobeSt.com was in attendance yesterday morning at an exclusive JLL breakfast presentation at ICSC RECon on retail where Naveen Jaggi, who leads retail leasing and capital markets at JLL, pointed out that the mall isn't dying, and is instead, simply changing.
“Malls have done a tremendous job in investing in common space, and need to be very responsible to that community and bring in the right retail. It is the retailer's job to invest. The days of plug and play retail are gone.”
Creating brand affinity has always been a top priority for retailers, but now retailers need new ways to build shopper satisfaction in-store, said the panel of experts at the presentation. The brokerage first recently evaluated 100 stores with Big Red Rooster and surveyed 2,000 shoppers across 10 retail sectors to help come up with how to do just that.
“We've developed universal criteria, what we call the six dimensions of retail experience, that retailers can use to help define and enhance their in-store shopping experiences,” said Stephen Jay, managing director of Big Red Rooster—a JLL company. “Our goal was to create new benchmarks to better understand how well retailers are meeting shoppers' expectations.”
Those dimensions include: intuitive, human, meaningful, immersive, accessible, and personalized, said Jaggi.
“As a shopper making a trip in-store you want to feel engaged, empowered and fulfilled. Shoppers don't like having their time wasted, so the ability to find what you need and to receive help from knowledgeable store associates can make or break a shopping trip,” Jaggi explained. “It's no surprise that shoppers at their core want an intuitive shopping experience, and we found that the retailers delivering on that principle were among the highest rated.”
The five retailers who are best at delivering against their shoppers' expectations of experience are: Apple, Victoria's Secret, Ulta Beauty, Bath & Body Works, and Ikea.
“By comparing how retailers perform on these dimensions to how important they are to shoppers, we can unlock ways in which experiences must improve,” added James Cook, director of retail research for JLL. “In the next five years, we expect shoppers' increased emphasis on experiential retail to push retailers across almost all sectors—except value-based discounters—as they compete for a greater share of shopper spend.”
In discussing what the future mall anchor might look like, Gregory Knoop, chief development officer for North America for KidZania USA, said that it will be places like KidZania—one of the fastest growing educational entertainment destinations in the world. Knoop said that KidZania, which is an interactive city for children combining inspiration, fun, and learning through realistic role-play, is a major destination traffic driver for a mall.
We also joined the firm at their evening party at the Cromwell Hotel, where Coleman Morris, director of retail agency leasing at the firm, talked to us a bit about food halls, and about what brands are seeking. “There is an accelerating engagement from digitally-native brands seeking bricks and mortar locations—they are highly selective, looking for uniquely positioned properties and offerings that speak to their target customer—but we're definitely seeing an increased desire for physical space and direct consumer to brand interaction.”
Morris tells GlobeSt.com that the proliferation of restaurants and food halls continues, but as the number of seats climbs, there is an increased focus by landlords on the experience of independent operators. “We are seeing restaurateurs being drawn to either emerging districts with lower occupancy costs or more authenticity or proven, high-volume locations.”
She also tells GlobeSt.com that specialty apparel continues to be evasive. “Even in the strongest locations, merchants are hesitant and are looking for far more flexibility in the lease terms in an effort to hopefully avoid a fatal mistake. Landlords are often granting these terms, especially when they're reciprocal—allowing them to be favorably positioned when the market resolves to a new normal.”
Keep checking back with GlobeSt.com for more from experts in the next few days and weeks as we fully cover the RECon 2018 event, with thoughts not only from attendees and panelists, but coverage of sessions, parties and more (even after it is all over). Also, be sure to check out some related stories below.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
