Exclusive: Shopping centers respond to ‘demand for experience’
Community shopping centers are evolving to become more than service providers to a neighborhood or trade area. Designed and merchandised correctly, they are fostering a sense of community and building experience. Chain Store Age talked with Mac Chandler, director of the Western Division at Regency Centers, about how community shopping centers have evolved to reflect today’s consumer preferences. Regency is a national developer, owner and operator of grocery-anchored community shopping centers, boasting more than 325 properties in its coast-to-coast portfolio. What is the most significant change you’ve seen occur in shopping centers over the past few years? The key is to balance a sense of community without losing what the big brands have to offer. National tenants still stir up excitement when opening in a new market, but we have also seen a shift where consumers want mom-and-pop stores and local chains alongside. Local merchants foster loyalty and build experience. The key is balancing convenience and experience, locally owned retailers with authentic architecture to help build a sense of place, so that each center has its own vibe that makes people want to hang around. Is there one category where this demand for “experience” is particularly strong? Restaurants. While our busy lifestyles create a need for trusted fast casual, at the same time chefs have become celebrities on-screen and off, and chef-inspired restaurants are rising in popularity as selective consumers demand a “something to-talk-about” experience. Although heavier in the west of the United States, healthy is a quickly emerging trend. Local chains are definitely healthier, and the demand from consumers is growing every day, especially from fast/casual restaurants. “Foodie” has become a term of pride, and social media can make or break a restaurant. Across several markets the focus has shifted to local and chef-inspired concepts, because it’s about the personality, the desire to support a small business and share their experience with their social networks. Interesting that you mention social media as a “make or break.” What is your take about social and shopping at a neighborhood center? Social media is a valuable tool for all retailers, but it has to be one part of a larger strategy. Omnichannel retailing is without a doubt working for some of our locally owned retailers that are seeing the shift in where audiences get their information, and discover new or exciting retail concepts. I was once told about a woman deciding where to take her mother for her birthday dinner. She tweeted her two choices, and one of the locally owned restaurants responded, promising to give Mom a special welcome for her big day. Naturally, that’s where they made their reservation. That kind of personal engagement is social media at its most valuable, as a resource to a locally owned business that is competing with the ad budgets of a national retailer. Are there any other “personal engagement” services that you see on the rise? Well, there are many, but one of the most popular is delivery service. No longer only for pizza and online stores, we’re now seeing delivery become an integral offering for brick-and-mortar stores of all types. Grocery stores are adopting online ordering with scheduled delivery windows at an incredible pace. And other, more unexpected vendors are experimenting with delivery as well. One of our San Francisco-area tenants is a dry cleaner that has adopted pick-up and delivery service so that their customers experience maximum convenience. In addition, they’re experimenting with a mobile app that allows customers to place their order online. That’s notable because there are a lot of people today, particularly younger consumers, who prefer to not have to make a phone call. With neighborhood centers, does convenience remain an important factor? How does that weigh against personalization and creating an experience? It’s finding the right balance of both. Consumers want their diverse, everyday life needs met in one place rather than having to drive around. We are bringing in tenants that typically weren’t a part of the shopping experience in the past, such as medical providers like dentists or urgent care and small-scale, specialty fitness providers that are situated alongside junior anchors. Centers are woven into the daily lives of residents, which translates to a steady pace of foot traffic throughout the day. For instance, a day for one visitor at a Regency center might look like grabbing a coffee before having a dental check-up, then browsing for a new outfit before stopping for lunch at a favorite café, and finally hitting a Pilates class – all without having to move the car. That’s the ultimate direction the community shopping center industry is heading –maximizing convenience, but always with the goal of creating a personalized experience for the customer that they’ll want to share with others.
