Retail Sees 'Change at a Rapid Pace'

SAN FRANCISCO—Even when the quick-click format of e-commerce isn't involved, retail today is operating at an accelerated pace, Colliers International's Anjee Solanki tells GlobeSt.com. For example, at the ICSC National Deal Making conference next month in New York City, Solanki says, “I'll be meeting with retailers who have four or five locations right now, and they're rolling out new ones pretty quickly.”

The reason they're ramping up their expansion, she says, is that “with the US economy, while we're still in recovery mode, our confidence has increased and banks' confidence has increased, so you're seeing loans being put out. The ability to finance, whether you're in the QSR workld or the apparel world, is rebounding nicely.”

That uptick in confidence is global, as well. Colliers, which examines 125 markets across the globe for its latest retail report, cites the findings of Nielsen's Q214 Global Consumer Confidence Survey, which showed an increase in consumer confidence in 52% of the markets surveyed.

Technology is also a strong driver in retail's accelerated timeframe. “We're seeing change at a rapid pace,” says Solanki, national director, retail services | USA.

That's being driven in large measure by shoppers' desire to have everything available at a similarly rapid pace, and filling that desire is proving “quite healthy from a retailer's perspective,” she says. For example, Solanki cites the dizzying variety of apps available for download. “So you not only have apps that are specific to retailers, but a whole new genre. You can download the Minibar app, and if you're throwing a party, almost instantaneously you can have your entire beverage service delivered to you.”

And while e-commerce is often perceived as being dilutive to brick-and-mortar sales, “the more sophisticated retailers are getting stronger in terms of how they use it, in more of an interconnected retail spirit,” she says. “Home Depot is wonderful about that—they've spent millions of dollars looking at how to create that interconnected experience, so that a customer who might be shopping online will ultimately pick up in-store and will actually purchase a secondary item.”

While retailers are showing their customers that they can be “quite nimble” in terms of multi-channel options, “if you can figure out how to get them back into the store, that's where you're going to see an uptick in sales,” says Solanki. “E-commerce should be used as a supplement; retailers who are sophisticated get that.” 

Retailers have gotten quite sophisticated about steering and influencing their customers. “It's taking all of these tools and opportunities and rolling them out as a cohesive package,” she says.  “All of these pieces—the timing, the brand recognition—have to be well reviewed and integrated so that the consumer understands it. Psychologically, you're training your customer to behave that way and utilize those tools.”

The retailers who get it make that point clear at the store level. Solanki cites a Nordstrom on Market Street in San Francisco. Its target customer base: “high income demographics. Small from a population standpoint, but high spend.” Accordingly, she says, “They've gotten their data analytics so focused. When you first walk in, you can see that they know who their customer is.” The price points alone immediately make it obvious that “they're not catering to the other demographics in that community,” even if that means creating opportunities for other, more entrepreneurial retailers.

Aware that they “only have x amount of square footage to merchandise in, they want to hit their key drivers of where they're going to push their sales per square foot,” Solanki explains. “They have collected so much data analytics over the years, and they can be much more focused on the types of brands and merchandise that they're pushing out."Thanks to these analytics, “they're styling their stores at a much faster pace.”

By contrast, at a Nordstrom 30 minutes away, “It's a very different feeling” from the Market Street location. “They're not going to do that there.”