October 25, 2018

The New York Times


Getting Shoppers Into Stores Takes More Than Inventory

In 2018, as many as 12,000 stores are expected to close in the United States, according to Cushman & Wakefield, a commercial real estate firm. Nine thousand storefronts shut down last year.

Yet despite this very real reckoning, countless retailers are not only surviving, but also thriving.

The secret to their adaptive success? Almost anything, it seems, that keeps shoppers on their toes is viable. That includes exclusive merchandise (will this location carry that handbag?), pop-up shops (will this store be here next week?) and experiences (can I eat or drink or post as well as shop?).

Innovations that offer intrigue, if not necessarily inspiration, seem to be winning.

Samantha David, chief operating officer of WS Development, one of the largest retail development firms in the country, has spent the last two years directing the Lazarus-esque revitalization of Palm Beach’s Royal Poinciana Plaza. The area was once a destination as prestigious as Palm Beach’s Worth Avenue, but it had lost much of its retail glory by the 1990s.

The project — which reopened in 2016 — is now one of four properties in WS Development’s Up Markets division that focuses on premier retail opportunities. It features 50 boutiques, including new Hermès and Saint Laurent outposts.

Despite her company’s sizable Palm Beach investment, she says she is aware of the crucial retail challenge ahead of her: getting people offline and into her Plaza’s boutiques.

“Gone are the days of shopping by necessity, as much of that can be satisfied online,” said Ms. David, the daughter of the fashion designer Lisa Perry and the former hedge-fund manager Richard Perry, who also has a majority stake in Barneys. “Today, shopping has to be a part of how I want to spend my day, spend my time, in all aspects.”

To get consumers spending their days at Royal Poinciana Plaza, Up Markets is pairing carefully curated retail with a robust schedule of on-site lifestyle programming like the “Backgammon and Bubbles” series (rosé bubbly for adults, a bubbles bar for the children) and the “Wee Royals” arts and culture activities for children.

Indeed, it would appear that the “hangout” is now as important as what is hanging on the racks.

Prabal Gurung, a Nepalese-American fashion designer, a favorite of celebrities like Priyanka Chopra and Kerry Washington, would agree. As he prepares for his label’s 10th anniversary next year, Mr. Gurung has decided that this is the year to debut his first stand-alone store.

He said his just-opened boutique on Bleecker Street in Manhattan’s West Village is “not the typical retail space where you just sell clothes.” Rather, the store is focused primarily on telling (and experiencing) stories — of the designer’s American dream come true, or the story behind the craftsmanship of handmade merchandise. Mr. Gurung intends to host a rotation of live events.

“We are opening our doors to the next generation to come in and experience that luxury doesn’t have to be cold and distant,” he said.

At the same time, Mr. Gurung has been chosen to be the creative director of “Love, Bleecker,” a joint project from Skylight, a fashion event venue development firm, and Brookfield Properties to reimagine beloved but bruised Bleecker Street, a totem of the past decade’s retail boom and bust.

“My dream for Bleecker Street is that every store should have a back story that can excite,” Mr. Gurung said. Under his recommendation, the “Love, Bleecker” collective showcases small-batch retail shops such as the floral atelier Fleurotica and Bonberi, a vegan and wellness bodega.

While eyes are always on the bottom line, brands like those from the designer Tory Burch are extending the definition of their stores beyond merely pushing new arrivals. Ms. Burch, who has over 100 namesake stores from Azerbaijan to Qatar, said that she wanted her customers to go into one of her stores “and feel like they are going into a home. Where they could hang out, have a drink, have their husband sit on a couch and it would be kid-friendly.”

And this season is now inviting those lounging in her Meatpacking District outpost to get hands-on with her other passion, the Tory Burch Foundation, which has given more than $40 million to causes supporting women entrepreneurs since 2009, including an education fellowship program partnership with Goldman Sachs. “Now that we have had real impact and scale, I am excited to bring it into the store,” she said.

Efforts like Ms. Burch’s reflect the changing nature — and increasing sophistication — of shoppers.

“Gone are the days when stores told the customers what they were going to buy,” said Robert Burke, chairman and chief executive of Robert Burke Associates, a fashion consulting firm with clients like Chloé and Vera Wang. “The customer is now highly educated about the brands. The customer drives the experience and that experience is not entirely transactional.”

That sort of hands-on trial activation can be as literal as Canada Goose’s Cold Room at the brand’s new flagship at the Mall at Short Hills in New Jersey, where customers can try on coats at temperatures as low as minus 13 degrees Fahrenheit. Additional Cold Rooms are set to open in Vancouver and Montreal, where customers could presumably just head outside to check on the efficiency of their purchase.

Other activations are a bit more grand. This September,, an English on- and offline fashion multi-brand store, introduced its retail residence: 5 Carlos Place. The five-story by-appointment “home” in London’s Mayfair allows not only for private on-demand shopping and weekly product curation, but also for entire floors of entertainment. A schedule of panels, podcasts, master classes, dinner parties and performances is available on the Matches site.

One of the pioneers of the “retail residence” is Ralph Lauren, whose first flagship opened in the 1980s on the corner of 72nd Street and Madison Avenue, in a former French Renaissance revival mansion. Rather than gutting the space, Mr. Lauren embraced, renovated and decorated it — turning it into a destination whose value transcended the clothes inside. The store is still referred to by the company and fashion experts as “the Mansion.”

“Ever since Ralph Lauren opened his first store, or shop in shop, he never really thought of retail as just his opportunity to sell clothes,” said David Lauren, the designer’s middle child and the company’s executive vice president of global advertising, marketing and communications. “What he did on Madison Avenue was create a home. You would move through it, sit down and enjoy a coffee or a glass of Champagne.”

During its 50 years, the brand has earned a reputation as an early adopter when it comes to technology: embracing everything from online customization to virtual reality and artificial intelligence. That is why it is rather quaint to learn that one of its most successful retail initiatives is Ralph Lauren coffee.

This fall, the brand reintroduced its coffee pop-ups around New York City and it counts the stand-alone Ralph’s Coffee in Hong Kong’s Harbour City and Ralph’s Coffee & Bar in London as bona fide hits. “It’s another way to experience the brand,” Mr. Lauren said.

Joel Isaacs, whose New York-based Isaacs and Company is a go-to real estate firm for luxury retail clients including Prada, Marc Jacobs and Jil Sander, said that all of the retailers he was talking to now were considering ways to incorporate events and some sort of food and beverage component.

Mr. Isaacs recently worked with the Texas-based fashion boutique Forty Five Ten as it looked for its first New York space. The shop had one caveat: “We did the deal with them at Hudson Yards, and they specifically chose the fifth floor of the project because on the fifth floor you’ll have four restaurants and they wanted to be in proximity to food.”

Menu or no menu, retailers want you to pull up a chair — or enjoy a performance — and ideally stick around and actually buy something. Even if that means the chairs themselves.

Mr. Gurung said he wanted to be able to highlight the furniture in his store. “We are teaming up with an interior designer,” he said. “If someone wants to buy that, they can.”

By Ariel Foxman

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