So Are Shoppers Using Bricks or Clicks?Some of the best retailers touch their customers seamlessly, whether through e-commerce, catalogs, direct mail or brick and mortar. Technology has improved the customer experience at all levels: the front of the house, the logistics chain, its efficiency and pricing, and customer knowledge and service. Social media will continue to enhance the connectivity of the customer and retailer, but in this omnichannel world the brand is more important than ever. A bricks-and-mortar strategy enables retailers to holistically present and establish their brands, create an experience that inspires customers and allows them to socialize and interact with others. Kimco Realty ( KIM), the largest shopping center landlord in the nation, is landlord to many "best in class" retailers including Home Depot ( HD), Wal-Mart ( WMT), Kohl's ( KSS) and TJ Maxx ( TJX). Dave Henry, Kimco's CEO and chairman, explains why "bricks and mortar" is a critical channel for retailers:
"It is increasing clear, with the striking success of Apple ( AAPL) Stores, that product manufacturers (even Amazon.com ( AMZN) in due course) need physical showroom space and stores in high-traffic retail centers. Combined with the growing demand for neighborhood goods and services of all kinds -- restaurants, health clubs, theaters, etc., -- together with an increasing population, very limited new supply, and the strong probability that e-commerce retailers will have to collect sales taxes, the future continues to be bright for brick-and-mortar stores."Tanger Factory Outlet ( SKT), the only pure outlet-focused REIT in the nation, has also forged a strategic social network that integrates the brick model with the click model. Tanger's president and CEO, Steven B. Tanger, says the following:
"Obviously, the convenience and 24/7 availability of e-commerce resonates strongly with consumers, but while online and mobile sales continue to grow, I do not believe that it takes away from consumers' excitement over visiting brick and mortar shopping centers. At Tanger Outlets, we are continually bringing in more in-demand designer and brand-name tenants to provide in-season and on-trend merchandise for our shoppers. Outlet centers provide a one-stop shop that offers great brands at a value price, in one location, in contrast to shopping online where consumers have to search for deals for their favorite brands individually. We also understand that the shopping experience itself is as important as the products that our tenants sell, which is why we fill our centers with dining options and often host concerts or special events at our properties. We want to ensure that we provide those traveling to visit our centers a unique and exciting shopping experience that cannot be replicated online."
The Evolution of RetailingIt is clear that many of the best retailers and shopping center owners are focused on giving consumers more than just an outlet to purchase goods. Beyond the basics, they are focused on creating positive, exciting, interactive experiences by leveraging their physical presence and the convenience of technology ... and whatever inventions in the way humans live -- and shop -- develop in the coming decades.
"Online shopping is here to stay and will continue to get better and evolve in terms of another attractive and convenient way for consumers to consume. As I see it, the effect is to effectively 'raise the bar' for retail landlords to provide a brick-and-mortar product that is complementary to online alternatives. A shopping center that is well-maintained and safe with convenient parking in a good location isn't nearly enough to ensure success any more. The mix of retailers in that center -- We call that the process of 'merchandising the center' -- is more important than ever and needs to be far more 'experiential' to consumers than in the past. Unique and well-run food uses are playing a bigger and bigger part in the mix as are tenants serving changing consumer habits in a faster-paced and highly technology-driven world. Further, more flexible shopping center configurations, such as fewer deep spaces that can only house one type and size retailer, allow for today's, and tomorrow's, more efficient retailer. This is extremely important to ensuring a center's long term success."