Future of Retail

Killer tax write-off and the future of retail

Eric Garland Real Estate Trends, Retail Trends Leave a Comment

As part of my work on the future of retail, I am…oh, who am I kidding, I just found this awesome tax-deductible way to make a trip to the Côte d’Azur a business expense – MAPIC 2016, a conference on retail and real-estate in Cannes, France in November, right about when the weather turns bad. Mostly, this is a killer excuse to hit both Paris and my old friends in Monaco and tell the IRS that it was a research expense. BUT, there’s actually a lot going on worth covering, particularly this bit called the Trends Hub.

I usually get irritated when I hear neologisms like Retailtainment, but in this instance, it’s a pretty critical trend to enhance the value of real estate square footage. If you follow my friend Doug Stephens, the Retail Prophet, then you know that retailers are under serious pressure in a world of Amazon and EBay and specialty sites like Reverb. As Doug is fond of saying, you had better give customers a compelling reason to do something other than have Amazon drone-deliver your goods, or you’re toast as a retailer. And of course, that has downstream impact on the real estate developers, who in places like over-retailed America, the landscape is being dotted with ugly, old investments just taking up space. So the challenge is: what are you going to do with people if they actually move their butts into your physical environment?

The simplest answer is that you entertain people. Make it a fun day, especially since you’ll be investing time and money driving or taking the train some place. Just walking through the physical version of a catalog simply won’t cut it – people need a payoff in addition to the acquisition of goods.

Now, I’ll have to check this out in person on my mission-critical fact finding mission, but the TrendsHub is featuring a few common themes:

Physical activities: Ice rinks (easy in our giant, abandoned minimalls), kids’ play areas, golf (easy in our giant, abandoned mini-malls), trampolines, and whatever you call those windtunnels that are like skydiving without the risk of death

Augmented and virtual reality: Since nearly 100% of your potential market will be carrying their own GPS-enable smart devices, the options for using physical space for an enhanced customer experience are nearly limitless. Pokemon GO, but for sporting goods or home improvement? I don’t see why not.

Arcade games: I’m a man of a certain age. I don’t care if this is even true – I just love that this might come back. WE WERE WRONG TO GET RID OF ARCADES!

The Innovations section here has got some more mature topics beyond video games (about which I do not feel ashamed for being overly excited) such as advances in geolocation, signage, multimedia displays, and “multi-sensory retail” which sounds…intriguing. Either way, the main trend here is in leveraging technology to enhance the ratio of experiences per square foot. That can be in entertainment, but as we have seen in some of the moves that Apple is rolling out, it can just as well be for education and community development.

Online to Offline Trends & Impact is actually one of the hottest concepts right now, as well. Forget Amazon competing with you online – you already knew about that. It when they and other innovators like them show up in the physical world that things are going to get really interesting.

If you’re into the future of retail, clearly a trip to the south of France is in order. Like you needed another excuse.