Customer Support
It’s no secret that properties in the retail sector have faced some daunting challenges over the past decade. Online retailers have been luring customers away from physical retailers, and then the COVID-19 pandemic encouraged even more households to shop for a broader range of goods and services online.
But not all shopping centers have suffered. Many retailers in mixed-use communities have thrived before, during, and since the pandemic. What accounts for their relative success? First, retailers often perform better in mixed-use communities because shoppers like the environment. As Grace Hill discussed in a recent ebook on live-work-play communities, apartment dwellers and office workers enjoy living and working in these neighborhoods. Similarly, consumers appreciate the vibrancy afforded by having complementary land uses in close proximity, as they do in many downtowns.
There are also a host of other factors specific to retailing that improve the odds of success mixed-use developments. For example, these communities provide a built-in consumer base for retailers, attracting a wide range of people, including residents, workers, and visitors who engage in different activities at different times of the day. It all leads to greater foot traffic for stores throughout the day.
Moreover, the diverse land uses in mixed-use centers — such as restaurants, entertainment venues, and other amenities — give consumers more reasons to spend additional time in the area. These longer “dwell times” benefit retail businesses as consumers often patronize multiple establishments when they visit. Thus, the synergy of various types of businesses results in more opportunities for cross-shopping.
Accessibility is another clear advantage for customers. With a range of goods and services available within walking distance or a short drive for residents and workers, mixed-use neighborhoods encourage more on-site activities. Shoppers appreciate the convenience of being able to easily get from their apartment or office to the grocery store, gym, coffee shop, etc. often without the need to get in a car and then find parking. Integrating different land users also promotes a sense of community, which can increase customer loyalty.
In all of these ways, the physical configuration and diversity of complementary land uses help drive retail success in mixed-use communities.
Understanding the Consumer
Still, proximity alone does not guarantee success if the retail mix does not match local tastes or otherwise generate interest among shoppers. That’s why it is essential for the retail center manager to determine the needs and preferences of the target consumers.
How can management gain this knowledge? The most effective approach is direct engagement with local residents and workers. Management should conduct regular surveys to understand their attitudes, shopping habits, and concerns. They can also assemble small groups of residents and workers for periodic discussions to obtain more detailed insights. The views of other visiting shoppers are also vital to ascertain and can be obtained through intercept surveys.
Sometimes, old-fashioned methods also work. For example, managers can place feedback boxes in common areas of the multifamily building to collect anonymous suggestions. They can also monitor social media using relevant hashtags and keywords to understand residents’ sentiments and preferences.
These approaches are easiest to execute when there is a single management firm covering all the property types in the community. But even when there are separate management teams, surveys can still be effectively deployed through partnership agreements to distribute questionnaires and gather resident and consumer input. In many cases, individual retailers conduct their own customer surveys, so there may be ways to collaborate with them on information gathering as well.
What’s Working? What’s Not?
In all of these methods, the primary goal is to determine what consumers like about the community, especially where improvements can be made. Topics may include the mix of retailers or how the center is operated. For example, the surveys may ask what types of stores or services the shoppers wish were available, including specific brands.
Also key is to gauge what factors influence their decision to shop within the community rather than elsewhere. For example, what challenges do they face when living, working, or visiting the community, what do they like most and least about the current experience, and what factors influence their decision to choose a specific retailer?
Underlying these questions is the quest to fully understand the existing customer base and identify what consumers may be missing. For example, is there a discrepancy between the demographic profiles of community residents and shoppers that could point to opportunities to attract other consumers who may be deterred from visiting the center? Is the center doing enough to attract visitors who neither live nor work in the community?
Finally, managers will want to know if there are modifications to the center’s operations that would raise consumer satisfaction and ultimately increase patronage. Do shoppers feel safe? Are stores and spaces easy to access on foot or by car? Would other services, like delivery or curbside pickup, improve the experience?
Surveys of consumers, residents, and workers can provide property managers with invaluable insights into how their retail centers can be optimized. The retail mix can be tweaked to attract more customers and improve resident satisfaction, which will ultimately increase retention. Moreover, by conducting these surveys regularly over time, managers can assess the effectiveness of their actions.
Contact Grace Hill today to learn more about our comprehensive survey solutions for commercial and multifamily real estate.
