| A story this week about Macy’s was reminiscent of our intro a few weeks ago related to “Zombie Malls.” The question explored in these two articles is the value of physical space, and in both the hypothesis that seems to prove true is that the real estate is indeed quite valuable, proven in the case of Macy’s by a takeover bid from an investor group. And while we know we are likely preaching to the choir on this one, we are still appreciative of these reminders as it reinforces why we are so dedicated to helping property owners make their real estate even more valuable and desirable as a partner. If 2023 wasn’t your year to invest, we hope 2024 might be and we’d be honored to help support you.
This week we saw some other stories aligned to our thinking when it comes to property ownership; retail store footprints are shrinking and diverse but prominent key tenants can be a game changer. We were also intrigued by a story around how store openings and closures impact online sales, but not totally surprised. What are some of the headlines catching your eye as we close out 2023? Post on LinkedIn and tag us!
This is our final newsletter of 2023 and we want to extend a heartfelt thank you to our readers, partners and clients! We are wishing you and yours a joyous end of the year and start to 2024. We’ll be back in your inbox January 8, and look forward to another year of keeping you up to speed on the world of digital and physical in retail. |
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| ICSC: Store openings, closings greatly impact online sales [Chain Store Age] Store openings increase a brand’s e-commerce business. Closing a store has the opposite effect. Opening a store leads to a 6.9% increase in online sales in the trade area surrounding that store for the following 13-week period, according to a new report from ICSC. For emerging retailers, the number jumped to 13.9%, signaling the importance of in-store shopping for brand growth. |
| Why even your local grocery store wants your digital data [CNBC] From Facebook and Instagram to Amazon Prime, most U.S. consumers have an online footprint that is growing daily. Email addresses, phone numbers, shopping habits, birthdays and more are all being rolled into a monetizable data profile the companies and data brokers are using to better understand the needs and wants of consumers. Often this is without the knowledge or informed consent of the consumers. |
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| Why digital gift cards are quickly replacing their plastic swipe cards [ModernRetail] Gift cards are a perennially popular holiday gift, but they’re increasingly showing up in email inboxes rather than on a plastic card, thanks to services and brands rolling out new means of delivery. Evite, the 25-year-old digital invitation and greeting card business, rolled out a new service this fall that allows shoppers to add gift cards, with popular options like Target, Amazon and Roblox. So far, said CEO David Yeom, about 25% of greeting card senders are adding a gift card. |
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| Micro & Last Mile Fulfillment |
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| You can tip your Amazon delivery drivers again – at no cost to you [ZDNet] Amazon is reviving an initiative to show its delivery drivers some gratitude and a little extra cash. For the second year in a row, saying “Alexa, thank my driver,” will pass on your gratitude and, if they’re one of the first two million to receive thanks this way, they’ll also get $5 from Amazon. |
| 5 delivery strategies to enhance customer experience [SupplyChainDive] When it comes to online shopping and delivery, customers have grown to expect a frictionless and fast experience. When they place an order online, they expect to receive it within their specified timeframe, often same- or next-day. |
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| Restaurants & Ghost Kitchens |
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| Assessing restaurant tech stack saves money, reduces management tasks [Fast Casual] From the day a restaurant is launched there is technology in place, whether it’s a stand-alone POS system, or platforms for handling HR needs, online orders and in-app activity. In short order, a restaurant often finds its inaugural tech stack has grown exponentially with related costs increasing as well as management oversight time. |
| McDonald’s doubles down on geofencing [RestaurantDive] McDonald’s is expanding its Ready on Arrival pilot — which uses geofencing to alert employees when a mobile order customer is nearing the restaurant so they can get the customer’s food ready — to its top six markets by 2025, the company said during its Investor Day last week. The chain deployed geofencing on its mobile app in March, but tested the technology as early as 2017. |
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| Ghost kitchens are making a post-pandemic pivot to survive [ModernRetail] Just three years after the spectacular peak of ghost kitchens, the business models of some of the industry’s largest players had taken a complete left turn. |
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| Macy’s Billion-Dollar Question: What’s More Valuable, Real Estate or the Business? [The Wall Street Journal] A potential buyout of Macy’s by an investor group revives an old theory: that much of the value in retail lies in real estate. Macy’s shares surged Monday after a Wall Street Journal report that Arkhouse Management and Brigade Capital Management submitted a buyout proposal Dec. 1 valued at $5.8 billion.
Here’s How ‘Golden Tenants’ Can Help Revive Ailing Shopping Centers [CoStar] A retail property in Kirkland, Washington, was struggling until a popular national grocer arrived on the scene, a move that industry professionals say could be repeated across the United States. That property, called The Village at Totem Lake and owned by CenterCal Properties of El Segundo, California, underwent a successful turnaround after bringing Whole Foods Market on board and it’s now thriving. |
| The American Store Is Shrinking [The Wall Street Journal] The average store size in the U.S. is the smallest it’s been in at least 17 years, reflecting profound changes in the way Americans now shop. The rise in e-commerce and a growing distaste for giant emporiums are softening demand for department stores and other big-box space.
After liquidating stores, bankrupt retailers are staging a comeback [RetailModern] Retailers that filed for Chapter 11 bankruptcy are looking to start a new chapter. Toys ‘R’ Us announced in November that it was planning to open a new flagship store at the Mall of America with plans to open more stores next year. Months after Bed Bath & Beyond went bankrupt, BuyBuy Baby unveiled plans last month to reopen 11 closed locations. And, off-price department store Century 21, which closed down its 13 stores in 2020, reopened its flagship location in New York’s Financial District this May. |
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