BRICK-AND-MORTAR HOPE FOR THE HOLIDAYS
Local, national stores thrive as online shopping grows
In a year that saw bankruptcy closures for no small number of national chains such as Toys R Us, which has stores in Norwalk and Danbury, or quiet local exits for boutiques such as Togas-House of Textiles in Greenwich, one could not help wondering what it is some retailers know that has many of them opening new locations in southwestern Connecticut.
As it turns out, some of those new arrivals know a lot — particularly about you, and the likelihood of your coming by to buy off their shelves, rather than clicking through Amazon to make a purchase from home or work.
With Amazon laying down the ultimate challenge this week — small discounts for shoppers who purchase from its websites after a photo price comparison of identical products on store shelves — the retail sector enters the 2018 shopping season in similar condition to that of a year ago, with a mix of companies struggling for survival contrasting with those that have hit on a recipe for relevancy — and even runaway success.
Any successes pale to that of Amazon, however, which has spent the past year solidifying its dominance through any number of initiatives, from discounts for Amazon Prime members at Whole Foods leading many to download the Amazon App; to extending the reach of its Amazon Web Services division that represents a massive repository of data covering not just retail but any number of other sectors.
After holding its summer Prime Day in mid-July, Amazon reported profits of $2.9 billion as overall revenue rose 29 percent from a year ago to $56.6 billion, with the web giant kicking off so-called “Black Friday” deals a full week in advance.
“I think we’re well positioned for the holiday — we have over 100 million Prime eligible items that are available for free, two-day shipping for Prime members,” said Brian Olsavsky, chief financial officer of Amazon, during an October conference call. “We feel like we’re going to have great capac- ity, not only for retail products but also for (Fulfillment by Amazon). We’re going to have great capacity for shipping to our customers. ... We’re very ready to go.”
Taking advantage of data
Even as Seattle-based Amazon selected New York City this month as one-half of a second headquarters on the East Coast, along with Arlington, Va., on a far smaller scale this year several traditional retailers have descended on Connecticut for new store openings — particularly Greenwich, which has seen the arrival of Fjallraven, Frame and Warby Parker to name a few; and Westport, where the exercise bike maker Peloton opened the past few weeks on Main Street, with the nearby Bedford Square retail development filling up fast.
According to Jessica Curtis, a retail brokerage expert in the Stamford office of CBRE, that is no accident, with companies now able to tap a flood of data on consumer preferences, courtesy of what they are tapping into their mobile phones as they make the day’s rounds, or web browsers at home.
“Many of these retailers have
had an online presence for a while ... and they know their customer is here because they are shipping products here,” Curtis told Hearst Connecticut Media. “They’re not coming to the market blindly — what they are doing is responding to a demand from their customer base that they don’t want to shop online. People still want to touch and feel merchandise. I think a lot of the retailers deciding to plant flags in our market are coming because they know (their) customers.
“Never before have I seen such science in site selection as we’ve seen in the last 12 months,” Curtis
added. “Being able to extrapolate (information) from cellphone data ... There’s a lot more information available that’s helping retailers make decisions as to where they go and where their customers live and shop.”
Malls in recovery
Danbury Fair mall is among the southwestern Connecticut retail centers that has demonstrated resiliency, both on a big scale with the successful absorption of anchor pads occupied by Filenes and Sears, and in the piecemeal recruitment of new tenants to replace those hitting the exit, recently to include CVS where Kidz Klub is opening, and Brookstone whose storefront remains dark. Speaking via conference call
in early November, Macerich’s head of national leasing said “the mood is definitely changing” among the retailers seeking space to expand.
“The conversations (previously) revolved around traffic being down in the malls (and) online shopping killing the mall business — but fast forward 18-24 months and ... these conversations are much different,” Healey said. “They’re talking about their experience. They’re talking about their marketing and their social media and their ‘influencers.’ I think the successful retailers, the ones that are performing today, took the last couple of years to really reinvent themselves to figure out their revised shopping patterns and to figure out the new customer
which is the millennial and the Gen Z. And in doing so they’re performing much better.”
For her part, Curtis sees that new confidence spilling out into the street-level retailers dotting southwestern Connecticut’s downtown areas — and believes shoppers will be out in force to explore what’s new in their own backyard.
“We’ve seen an influx of cool retailers ... in the last six months,” Curtis said. “I think we’ve seen some really good indicators that the market is still strong for our retail streets.”