The Power of Data & Advisory in Retail Real Estate
Consumer demands have evolved beyond traditional apparel, accessories, and footwear to encompass innovative experiences, services, and food and beverage concepts. To thrive in this fiercely competitive and rapidly evolving landscape, retailers must embrace data-driven strategies along with expert advisory services to inform their real estate decisions. From analyzing mobility patterns to delving into ecommerce analytics, retailers can harness data's contextual power to create an impactful real estate strategy that drives long-term success.
By leveraging data and advisory, strategic retailers are able to:
- Identify Market Entry & Expansion Opportunities
In 2023, the U.S. witnessed 5,645 new store openings, marking the second consecutive year of openings surpassing closures, according to Coresight Research. This outpacing trend is expected to continue into 2024 with an estimated 5,500 new stores opening. With so many brands in expansion mode, the practical application of complex data is crucial for retailer success. Demographics and consumer segmentation analytics enable a deeper understanding of the demand within submarkets, while competitive benchmarking data provides strategic growth opportunities and insights into market saturation. Significant changes in migration patterns have heightened the importance of understanding emerging retail markets for store relocations or lease renegotiations. Additionally, this data also informs decisions on new products or store renovations to ensure continued alignment with consumer preferences.
- Drive Optimal Co-Tenancy
As highlighted in our Main Streets Across the World report, experience, purpose, and convenience are all elements that can define a shopping mission. By gaining a deep understanding of consumer segmentation, purchasing preferences and content affinity, brands can paint a detailed picture of their consumer and build deep insights around their core customer base. This knowledge empowers retailers to strategically position themselves to capitalize on cross-shopping opportunities from similar consumer demographics or complementary products and services, further enhancing shopping center foot traffic, extending the duration of stay, and thereby enabling brands to foster a more personalized consumer experience.
- Optimize Real Estate for Maximum ROI
According to recent research by TCS OmniStore, most retailers understand the importance of unified commerce, but only 3% of retailers currently provide a ‘truly unified experience.’ A holistic review of a brand’s real estate portfolio can ensure synergy between physical stores, wholesale partnerships, retail media and e-commerce channels. By combining various datasets with critical thinking, retailers can identify underperforming stores, address operational challenges, and implement targeted solutions. E-commerce data provides valuable insights into consumer behavior, which can be leveraged to forecast product demand and guide decisions on the location, size and configuration of distribution centers. Ultimately, an integrated approach leads to better operational efficiencies and overall cost savings, highlighting the importance of data and advisory services in optimizing real estate.
While leveraging data and analytics is crucial for a successful real estate strategy, it is equally important to possess the knowledge, experience, and critical thinking skills to analyze this information effectively. Complex real estate portfolios require complex solutions. Only by distilling raw data into actionable insights can retailers drive long-term viability in a competitive market landscape. Our Retail Location Analytics & Strategy team stands ready to provide the expertise and support necessary to navigate the complexities of uncovering your next store location and achieving your goals. Contact Jim Kierski for more information.
