While 93.1 percent of all retail sales in Latin America are still made in-store, savvy retailers are increasingly exploring opportunities to merge the in-store experience with the convenience of shopping online. Panelists speaking at the ULI Latin America Annual Conference in September also said that retail is ripe for investment, as the growing middle class is gaining access to credit and earning higher wages in many cities.
Ignaz Gorischek, an award-winning designer at CallisonRTKL in Dallas, outlined some pivotal data points and success strategies for fusing the experience and e-commerce for a multigenerational audience in a keynote presentation.
Latin America, in particular, is ripe for innovation in retail development. An underdeveloped retail landscape has primed a path for developers eager to enter this emerging market. Gorischek stresses that offering a community-focused center that appeals to tourists while ensuring the utmost safety is a sure strategy for drawing more audiences to a retail development.
“Stores aren’t focused [exclusively] on purchases anymore, they’re focused on experience,” Gorischek said, highlighting a new trend among real estate developers that ensures that the public is constantly finding excuses to interact within a mixed-use development complex. “The value equation is shifting now—luxury used to equal comfort and status, but this new model equals time and personalization,” he said.
Surmising that audiences today are searching for collaborative spaces that “stimulate all five senses,” Gorischek points to a number of successful retail developments across the United States. The Color Factory in San Francisco and the Museum of Ice Cream, a pop-up traveling exhibit, both demonstrate that consumers are willing to pay a hefty ticket price for an Instagram-worthy experience, complete with captivating, colorful installations and bountiful opportunities to purchase trendy goods.
“We want to provide a unique experience through innovation, creation, and personalization,” Gorischek said. “Allowing visitors to take control of what’s happening will increase in importance.”
That is especially true of the millennial generation, who value social capital, independence, and collaboration above all. “We’ll need to create retail developments that allow multiple generations to coexist in one space,” said Gorischek. “Families will come together to eat, then part to shop, and reunite again over an experience.”
Brands like Nordstrom, Nike, and Neiman Marcus are capitalizing on this insight. Nike has rolled out a series of interactive stores that allow you to upload and share your sneaker selections with your social media followers on massive, eye-catching screens, creating a live, collaborative experience as you make your way to the checkout counter. At Nordstrom, guests can browse the store’s shoe offerings on iPads and drop their collections into their “digital shoebox.” They can then share these options on social media, asking friends to vote, before making their final selection and retrieving their purchases on the spot. And at Neiman Marcus, Memory Mirrors allow you to explore beauty products with augmented reality, allowing guests to experiment with different shades and different complexions before arriving to their ultimate purchase.
In making predictions, Gorischek noted that lines will continue to be blurred, and that designers will need to focus on designing for temporary uses over more permanent ones while exploring new ways to pair stakeholders. For example, big-box stores—which in the United States today represent a major challenge for real estate owners and investors—can once again be deemed valuable by applying an innovative design approach. At Bespoke in San Francisco, a former big-box store went from being a liability to an asset by implementing a WeWork-style design, in which multiple entrepreneurs are offering their product, service, or ideas in an open-style display setting. “Like-minded people are coming to experience the space—it’s low-cost for entrepreneurs, and it also creates foot traffic,” Gorischek said.
Gorischek advises Latin American developers to consider that life is becomingly increasingly hybridized, where home, work, and play are intertwined. Designers and architects should be prepared to create spaces that are adaptable and multipurpose, so that today’s shoe store can become tomorrow’s café or learning center. Changing consumer attitudes and a generational shift toward experience over convenience are key indicators that inspiring design will remain an important marker for retail success.
Finally, Gorischek stressed that the future of retail development lies in identifying these shifts in consumer attitudes and applying those findings on an impactful scale. “The shift has a lot of parts and pieces, and I don’t think we can be successful by doing one or two,” he said. “If a chef forgets an ingredient, it changes the flavor of the dish. The same thing happens when you’re designing an experience. It’s all part of one equation.”