02 Jun E-Tail Changing the Face of Commercial Real Estate
The world of retail is rapidly evolving with the advent of companies like Amazon, eBay and Netflix, that only exist on the internet. The rise in e-tailing has affected the way that a lot of businesses are operating and, in turn, is drastically changing their needs in retail space. This has left many national and local retailers scrambling for new ways to innovate how they present their products to their customers as well as prompting a change in how real estate agents are marketing commercial space to potential buyers.
Recent research reported by the National Association of REALTORS® tells us that consumers desire a shopping experience that blends the ease and convenience of e-tail with the tactile experience of shopping in a store. A recent Forrester Research survey reported that shoppers said visiting a store served as the more important source of product research before purchasing in every major consumer category with the exception of travel.
“The good news is that even though Apple, Netflix, Amazon, eBay, and other online giants killed record stores and video rental shops and are in the process of doing the same to electronics and bookstore big boxes, e-commerce will never replace the brick-and-mortar shopping experience,” Sean Glickman, managing director of Glickman Retail Group in Maitland, Florida, said in NAR’s report.
Retail Real Estate in Transition
This factor is resulting in a great change in the way that retailers are looking at their commercial space and, consequently, alters the way that commercial real estate agents are thinking about these clients. Instead of looking for huge warehouse space for big box stores, agents are now being tasked to find smaller spaces that can accommodate advanced forms of technology so that retailers can attempt to meet all the needs of their consumers.
“This research speaks to the need for retailers to focus their technology efforts inside the store,” said Dan Seliger, digital strategist for 3GTV Networks, in a recent blog post. “We have to stop thinking of the Internet as something tethered to a home computer or a shopper’s smartphone. The goal should be a borderless communication continuum where every channel is connected. … Smart retailers can use this approach to help overcome the inherent limitations of brick and mortar while offering shoppers a blended in-store experience built around their needs.”
As a result of this transition in shopping, retailers are looking for ways to refine the retail and e-tail experience that they are able to provide. This includes reducing their square footage into more efficient footprints, which will mark the demise of larger, big box retailers.
Retailers will also continually focus on logistics as a means to get their products to consumers. With an increase in e-tail activity, the last mile of distribution is now commonly outsourced to the consumer. This is transforming some retail locations into a delivery conduit from manufacturer to the hands of the consumer, with shopping and buying done solely online.