The evolution of retail and retailers is inevitable. As consumer’s tastes change and technology continues to force change, the revolving door of retailer names keeps rotating. Those changes have never been so rapid as they are right now. Remember the days when every shopping center included the likes of video store, travel agent, or a Hallmark store? For most of the twentieth century the evolution was subtly impacted by technology change in ways that most were unaware. The force of change during the later half of last century, particularly the 1950’s-70’s was as a result of the proliferation of the automobile. After the Great Depression and particularly after WWII, with the flood of baby boomers and prosperity, most households now owned automobiles. As a result there was a mass exodus from the central cities and the birth of suburbs. Downtown retail suffered greatly and there was the new innovation in retail called ‘malls’.
Shopping venues evolved from malls to include grocery anchored strip centers, ‘power’ or big box centers, outlet shops, lifestyle and mixed use centers, and finally again to the rebirth of downtown retail. Not only were these manifestations of of the flight to suburbia, but also reflected the economic condition of the times. More frugal times saw the popularity of big discount stores, while prosperous times helped to propagate the luxury branded retailers.
While those changes in the last century were slow and subtle, the changes to the retail scene today are fast moving and brutal. The changes ahead could be even more startling. Today’s protagonist is the internet.
The internet has had a profound effect on retailers and thus shopping centers themselves as has been evidenced by the almost total elimination of some categories of retail stores. People don’t rent videos, don’t go to a travel agent, don’t send greeting cards, don’t buy books and magazines like they used to…it’s all gone digital. How much longer will the big booksellers, office supply and electronics stores survive? Even the largest of the large, Walmart, has to be very concerned as Amazon and the virtual world continue to seize major market share. As today’s tech savvy youth become the predominant consumer, online will eventually dwarf all others.
What does this mean for us? If you play the stock market maybe you buy a few more shares of Amazon or FedEx (someone has to deliver all of that stuff). If you are a retailer, you have to “right size” your store, learn how to better excite your customer and provide a more personalized experience. Deal with the inevitable change or that change will deal you a bad hand. For the shopping center industry, there will be an increased focus on food, entertainment, medical, and personal services that can’t be delivered electronically. Big box retailers will become distribution centers and showrooms for their online sales. Shopping centers will have to be focused on convenience to the consumer or provide real stimulation and excitement.
Will the small retailer survive this assault? Fortunately, people are social and they still love the centuries old pratice of going to the local market, and desire as well as that sense of discovery that any accomplished retailer can stimulate. And so the cycle of change revolves.
Dougall McCorkle, MBA
Sales Associate and Commercial Specialist
Premier Commercial, Inc., Licensed Real Estate Brokers
Direct: 239.213.7234
Cell: 239.860.3368
dougall@premiermail.net