Contrary to some predictions, e-commerce has not made brick-and-mortar retail a thing of the past. Instead, as attendees at a ULI Spring Meeting session learned, shopping and dining are making critical contributions to activating urban spaces and helping shopping centers continuously evolve.
“Customers shop in many different ways, transacting however they want to,” said Peter Huddle, a senior executive vice president of Westfield, the Australia-based owner, operator, and developer of flagship retail assets. “We work closely with Nordstrom and other stores to make sure the product search is easy. You should be able to go online and look for a black dress at your local shopping center, then view selections at any of the center’s stores.”
This new customized shopping experience will start right in the parking areas, he explained. Sensors, scanning license plates upon entry, will recognize loyalty program customers and direct them to reserved parking in front of their favorite stores. Those same customers will also be able to leave quickly without having to stop and pay for parking.
Westfield is in the early stages of implementing this new digital technology, with plans to spend $20 million to $30 million per shopping center, said Huddle. One initiative, now being pilot tested, would allow a customer to go online and reserve a number of items at a single store, which the store would place in a fitting room at a specific time. The customer would be provided with reserved parking near the closest door, go directly to the fitting room, try on the preselected items, purchase what she or he likes, and leave the rest behind. Westfield plans to offer this and other new options at its existing shopping centers and new ones currently under development.
Brick-and-mortar stores are still relevant, stated Dawn Clark, a vice president of store design for Nordstrom. “Our data show that where we don’t have a store, we don’t have much online business. From an urban land use perspective, retail always holds the fabric together.”
When moderator Cindi Kato, a vice president at CallisonRTKL, asked about the growing role of food and beverages in stores and shopping centers, the panelists had a lot to say. “More food is coming,” said Clark, noting that Asian and European department stores offer more extensive food selections than do U.S. stores. Globally, customers visit department stores with food halls 28 times per year, compared with only eight times per year for those without food halls.
“Food is entertainment these days. It is almost the top priority,” Huddle said. Italian food marketplace Eataly occupies 40,000 square feet (3,700 sq m) at the new $1.5 billion Westfield World Trade Center, which opened in August 2016. Integrated into lower Manhattan’s revamped transportation hub, the shopping center brings together commerce, community, and culture in the spectacular Santiago Calatrava–designed Oculus. Eataly also has a multilevel space at the new Century City retail destination, including outdoor seating with rare vistas of Beverly Hills.
Westfield is seeking smaller, high-quality restaurant operators such as Javier’s and Typhoon, as well as sought-after purveyors of desserts, coffee, chocolate, and more. One California center has a successful new Asian food hall. It is all part of an effort to drive traffic, expand the center’s trade area, and stimulate cross-shopping. The days of mall food courts and restaurants on pad sites are gone, or soon will be.
Beyond consumables, retailers are deploying an ever-changing array of attractions to increase foot traffic. Starting with British fast-fashion chain TopShop, Nordstrom has featured a variety of brands using pop-ups, pop-ins, or other special displays.
Nordstrom’s Seattle store currently has the world’s only Hermes pop-up, designed to attract younger customers with an Instagram-ready installation of dangling ropes made of rolled-up scarves. The same store also currently features a Korean designer collection. A six-week Kylie Jenner pop-up in Nordstrom’s Topanga store in Canoga Park, California, was a social media sensation that far outweighed its cost. These concepts not only drive traffic, but also create a sense of freshness and even urgency due to their temporary nature.
Overall store design plays a role, too, Clark said. “The building should be a platform for fashion. It should not just be a box with its contents hidden from the outside,” she said. “We are bringing in more light: our newest store has an all-glass exterior. Natural light changes all the time; it can be problematic, but the changes add a lot of energy.”
A large canopy was removed from three sides of the company’s Seattle store, because “we don’t need more shade in Seattle,” she said. Nordstrom also has added curated art installations: in its Vancouver, British Columbia, store, the art is so popular that Nordstrom created an app providing a self-guided tour.
Trends applying across shopping centers include clothing recycling, incubators, and short-term leases for up-and-coming designers, food trucks, and more.
“Commoditized fashion product is suffering,” said Huddle. “To be relevant in the future, you have to create an experience, starting with design. Shopping malls should have a human scale, more like a collection of high streets, with locally created artwork and hotel-quality restrooms and amenities.”
Westfield has even acquired an off-Broadway theater company, Scott Sanders Theatrical Productions, to bring talent and content to its shopping centers. Sanders, who won a Tony Award for his revival of The Color Purple, was appointed Westfield’s first-ever creative head of global entertainment. So now the shopping center can be a place where people come to be entertained, dine, have a social media moment—and, of course, shop.
Leslie A. Braunstein is principal of LHB Communications Inc., a public relations firm located in the Washington, D.C., metropolitan area.