As online retailers continue to re-shape the industry, there is no shortage of discussion of the effects on commercial real estate and brick-and-mortar stores. 2017 was a dismal year for retailers and real estate professionals alike, with thousands of closed shops and vacant storefronts. However, new spaces have been evolving out of the primordial pits left behind that address the changing face of retail and offer new opportunities to real estate professionals with a store front to sell. While the trend has been growing for some time in the hands of tech and auto innovators, experiential retail has reinvigorated the walking traffic to stop in stores and incentivised creative retailers to lease or buy premium spaces in order to ride the wave of this trend.
What Is Experiential Retail?
Experiential retail sells more than just a product to the customer, instead choosing to focus on the product at hand or else creating an atmospheric experience for the consumer, taking away the feel of traditional sales and shopping. Basically, because so much has changed in the digital age, your retail location becomes a marketing campaign for your products. Think about the spaces that are used more for showcase, rather than sales. Picture any Apple store or Microsoft store, which don’t have price tags or stocked shelves, but instead showcase products and features that are available in the digital space. Rather than focusing on location by location sales, experiential retail spaces are used to drive the overall sales and market the products in high traffic areas. Some great examples of experiential marketing include:
- Ikea – Every Ikea store has a unique layout and offers shoppers the opportunity to wander through their maze like showfloor and see how each product could look in their home.
- Warby Parker – Warby Parker, an online retailer of glasses, started in the digital space to make purchasing glasses easier and less expensive, but new stores have been popping up to give customers the opportunity to see just how the glasses will look offline.
- Amazon – Even the great digital retailer is opening stores across the country, giving shoppers the opportunity to complete their shopping face to face.
Whatever the space and whatever the product is, it’s certain that despite the gloomy real estate trends of 2017, people truly do love a great in-person experience. There is plenty of room left for real estate professionals that recognize opportunity where it’s blooming in experiential retail.
Is There Still Room To Innovate?
If the goal is to offer a space that customers can do more than just purchase products and leave, there are a lot of creative avenues left to explore for real estate professionals and retailers in partnership. Consider these spaces which defy what most have come to think of as traditional retail spaces:
- The House Of Vans – A 30,000 square foot space that integrates art, music, street culture, BMX and Skateboarding under the same roof, offering Vans the opportunity to reinforce their brand using a unique real estate space.
- The Churchill – A unique space in Phoenix’s Roosevelt Art’s District, this collection of local businesses occupy old shipping containers used to craft a community space where people can gather, eat and drink in an uncommon environment.
- Downtown Container Park – Supporting art, entertainment, cuisine and retail in a lively Las Vegas downtown can be hard to do in a way that stands out, but the Downtown Container Park is truly a different space.
These examples are just the tip of the iceberg in a real estate landscape ready for unique experiences that couple with all their basic or lavish needs in a single stop.
Crafting Space For Experiential Retail
While everyone would like to sell their space as one-of-a-kind and ready for innovative tenants, research is the most important aspect of determining where to purchase existing real estate or to develop. Determining the right demographic and finding a space that geographically supports creativity with room for growth will allow any experiential ventures to flourish.
Property owners can employ clever marketing to attract retailers to their spaces, focusing heavily on a proper digital layout and representation, ensuring retailers that focus on a hybrid between brick-and-mortar and digital sales that you are aware of the concerns their business faces. Focus marketing efforts and tenant placement that creates a welcoming atmosphere, with entertainment, food and drink all occupying your ground floor. Focusing on the experience on your ground floor will attract bigger clients for your upper floors or bigger spaces.
Hitting Trends Early
Experiential retail is here to stay and while it’s been established as a practice for some time, there are still a lot of businesses that are behind the curve on this rapidly changing landscape. No matter whether you are a retailer looking for a unique space with plenty of traffic or a property owner looking to attract creative tenants, the team at LCI Realty can help you build the right connection or find the right space. Contact a member of our team today to find out more information.
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