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It’s not the first time we’ve discussed this topic before, but it warrants repeating…Gen Z loves the mall. An article in the Los Angeles Times highlighted this phenomenon, backed with research from ICSC and plenty of expert commentary. Why do we find this so compelling? Because the first digitally native generation values in-person experiences – something I think few predicted. In fact, many predicted the opposite – that the internet would kill the mall. Identifying this trend, and finding ways to capitalize on it will be crucial to success in the coming years (and likely decades, should/when the trend continues.)
This week we also read about some downsizing and closures which was another unfortunate trend across all industries this month. We know you might be on an AI overload, but it’s really everywhere in our industry and growing every day. Whether it’s helping provide a better delivery, or improving customer experiences or improving ordering a pizza the fact of the matter is that AI is becoming more a part of our work and personal lives each day. And finally, while you’re catching up on the trends from this newsletter, don’t miss our post on LinkedIn about the value malls can find in their parking lots.
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Walmart Closes Store No. 8 Innovation Unit [The Wall Street Journal] Walmart plans to shutter Store No. 8, a business unit it created to spur innovation, as it works to curb costs and test technology in new ways. When Walmart launched the unit seven years ago, it was working to quickly catch up to Amazon’s growing online business and foster new ideas that might not be immediately profitable.
Retailers, hyped about generative AI, deploy customer-facing tools [RetailDive] Retailers are turning to generative AI to power search engines and chatbots in a push to make the digital experience more helpful and convenient. As generative AI lays the foundations for the next generation of web experiences, retailers are developing use cases with customers in mind.
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Customers have soured on self-checkout, and a new study says there’s proof [CNN] A newly-released study by researchers at Drexel University found that “regular checkout” – the kind featuring a human cashier – makes customers more loyal to a store and more likely to revisit in the future than self-checkout. The study comes as some companies remove self-checkout machines and others adjust their self-checkout operations.
Seen and Heard at #NRF2024: 5 Trends from the Big Show [Retail Touchpoints] There were some clear, overarching themes that emerged from Big Show sessions, booth campaigns and conversations, indicating that retailers may be investing in the innovation they need to win consumers’ hearts, minds and wallets.
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Micro & Last Mile Fulfillment
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Shipt unveils Innovation Lab, expands retail business accelerator [RetailDive] Shipt announced its new Innovation Lab to focus on “big thinking” delivery to meet the needs of retailers, CPGs, and customers. The lab is currently prioritizing new delivery frontiers like drones, digitizing end caps with its “Cool Finds” program, and monetizing virtual experiences through platforms like Roblox.
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Want Your Packages Delivered Faster and Cheaper? AI Is on the Case [The Wall Street Journal] Order a package? AI researchers are hunting for the best way to get it to your doorstep. It might be a drone flying from a nearby pharmacy. It might be a robot that hops off a van that is driving down the street. It might be a system that helps drivers anticipate where a parking spot is about to open up near your door.
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Retailers Return to Bringing in Inventory ‘Just in Time’ [The Wall Street Journal] Merchants have worked through the excess inventory that piled up on store shelves and in warehouses over the past 18 months, and are now focusing on replenishing items rather than stocking up on goods to have on hand in case of supply-chain disruptions. The shift marks a return to the “just-in-time” inventory management strategy many companies had employed before pandemic-driven product shortages and volatile shifts in consumer demand prompted a switch to a “just-in-case” stockpiling approach.
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Malls have rebounded thanks to an unlikely source: Gen Z [Los Angeles Times] Gen Z prefers in-person as much as online shopping, if not more, according to a 2023 report by the International Council of Shopping Centers. According to the trade group, about 97% of survey respondents said they shop at brick-and-mortar stores; 95% said they shop online for the convenience.
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Tanger Adds New Focus to Successful Outlet Center Strategy [Nareit] With more than four decades of experience as an owner and operator of open-air outlet and retail destinations, Tanger Inc.’s recent purchase of an open-air lifestyle center—its first move into that particular segment of the market—underscores how the REIT continues to look for ways to innovate the retail experience for its shoppers.
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Macy’s to cut 3.5% of its workforce, close 5 mall anchors [RetailDive] Macy’s is reducing its workforce by 3.5%. The company also plans to close five Macy’s full-line stores. “As we prepare to deploy a new strategy to meet the needs of an everchanging consumer and marketplace, we made the difficult decision to reduce our workforce by 3.5% to become a more streamlined company,” a spokesperson said.
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Restaurants & Ghost Kitchens
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It’s “carnage everywhere” for restaurant owners facing high costs and new rivals [Axios] Rising food, rent and labor costs, mixed with falling post-pandemic demand, are spelling disaster for some independently owned restaurants, industry experts say. Many independent restaurants have struggled to cope with declining demand and higher costs, while pandemic-era loans are coming due.
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13 Ways AI May Impact And Improve The Restaurant Industry [Forbes] If you’ve ever ordered pizza or fast food online, you’ve likely seen artificial intelligence in action, perhaps in the form of food suggestions based on your previous orders or, if it’s a national chain, a menu of special deals specific to your local area. AI has already penetrated the restaurant industry, but it’s likely to soon bring even more to the table.
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The restaurant industry has a heartbeat after years on life support [Axios] The restaurant industry is showing signs of life after a brutal stretch brought on by the COVID-19 pandemic, per new Yelp data shared with Axios. Nearly 53,800 restaurants opened their doors last year, up 10% from 2022, based on new Yelp listings.
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