Across the country, stores are empty while porches fill with delivery boxes, placing retail owners and developers in a unique position. The changes retailers need to make are fundamental, not incremental, and these changes begin with decisions about how to locate, build, and outfit retail spaces.
From the earliest days of civilization up through the beginning of the 21st century, a prerequisite for commerce was getting goods and customers to a physical market location. When the virtual world began to augment, and often replace, the physical world, retail was one of the first areas to suffer. The convenience of online shopping — in some cases, “one-click” shopping — is inarguable. The good news for retailers and developers is that while bricks-and-mortar establishments may never be able to compete on the level of convenience, they still have something to offer consumers. In a word, what physical stores offer is an “experience.”
To fully identify what makes an experience, retailers and entertainment providers are seeking to understand human psychology, then use their findings to conceptualize, design, and construct environments that engender unique, positive feelings to increase customer engagement.
Because experiential retail/entertainment is an evolving field, when planning construction and renovation projects, companies should find partners who understand the new rules of the game, engage those partners early in the process, and use collaborative work processes to fully explore and implement strategies that drive customer engagement.
What Makes an “Experience?”
Contrary to popular belief, retail is not dead — but it is changing.
One important way to appeal to human psychology is through sensory pathways. A venue’s physical features, ranging from the surrounding urban or suburban context to architectural elements, can create feelings of welcomeness and shift moods toward relaxation or excitement — even if their effect is on a shopper’s subconscious. During site selection, it’s important to be mindful of contemporary design features and how they fit with the community. For example, experiential retail and entertainment venues might benefit from both indoor and outdoor areas. Ensuring access to natural lighting is another factor that might allow designers to broaden the sensory inputs available to a store’s customers. Elements such as clerestory windows can create a pleasing sense of space while allowing more natural light.
Sustainable practices in retail construction are gaining traction as businesses strive to minimize their environmental impact. Incorporating eco-friendly materials and energy-efficient technologies helps reduce operating costs and fosters a healthier shopping environment. Design elements that emphasize natural light and ventilation can improve the shopping experience while decreasing reliance on artificial lighting and air conditioning. Retail spaces are increasingly featuring green roofs, rainwater harvesting systems, and solar panels to advance sustainability and lower carbon footprints.
Retail spaces are increasingly featuring green roofs, rainwater harvesting systems, and solar panels to lower carbon footprints.
Physical environments can heighten positive emotions such as joy or curiosity — and curiosity, in particular, pairs well with exploring physical objects in an unfamiliar and stimulating environment. Retail/entertainment experiences can even fulfill basic human needs, such as social interaction or a sense of community.
Designers and contractors in the retail/entertainment space are seeing some companies achieve these effects with success. Several well-known, high-end retailers have made large-scale expansions. Particularly for sporting, outdoor, and high-end retailers, the amenities in new facilities are evolving.
A growing strategy is to blur the lines between retail, entertainment, and dining. Offering food or dining related to a store’s brand is a way to broaden a customer’s experience while creating a unifying theme. Some companies incorporate elements of the hospitality industry or give their spaces a residential, homelike feel. Combining these different business models activates different moods in customers. However, this recent innovation requires site selection teams to consider demographics, complementary amenities, and market saturation for the intended business model.
Combining business models activates different moods in customers.
The focus on design can extend to having galleries or curated spaces with pieces from a product line. For example, home furnishings retailers build model residential rooms to create a sense of comfort while providing inspiration on how to furnish or organize spaces at home. This approach can be enhanced with design consultation services and studios, combining unique digital resources and personalized service. Sporting goods retailers have installed amenities such as climbing walls and putting greens. Some businesses have even pioneered large-scale amusement park attractions or full-sized sports or music venues in retail landscapes.
Showrooms are experimenting with interactive displays, augmented reality (AR), and virtual reality (VR) technologies. From virtual rooms to futuristic landscapes, VR can support shoppers’ practical aims while adding gaming-level fun. Other hybrids of physical and multimedia experiences include interactive installations and new technologies for product demonstrations. These innovations may require site selectors to consider infrastructure and community fit, especially if retrofitting an existing location.
As for more traditional retail models, success is still seen by large retailers offering an inclusive shopping experience. This business model works by combining consumers’ desire to see products in person with convenience. This type of retail still favors expansive suburban or exurban locations, although some retailers find success with smaller formats in urban areas.
High vacancy rates in American malls and big-box stores offer redevelopment opportunities.
Taking Advantage of High-Vacancy Building Types
Vacant big-box stores and shopping malls dot the American landscape. For this existing building stock, just as with new-build projects, experienced designers and contractors can help owners assess development potential. Contractors can advise on factors pertaining to retrofitting and redesigning existing spaces, from large-scale structural considerations to sustainable practices. They can offer insight into consolidating retail spaces or repurposing vacant big boxes, making them attractive to more tenants. Tenants of reimagined retail spaces are learning to coexist with other new users of mall and shopping center sites, including residential developments, healthcare providers, and offices.
Contrary to popular belief, retail is not dead — but it is changing. By understanding the market, retailers and developers can deliver an elevated shopping experience and take advantage of the changing, yet robust, retail market. Shifts in consumer preferences and behaviors create opportunities for new facility design, but they also come with challenges. General contractors are key partners in navigating these challenges and guiding teams toward best practices for building new facilities.
