Naperville, historically, has been ranked top in retail sales in the Chicago Metropolitan suburbs. This remarkable success translates into significant tax revenues to support our great schools and other community services that continue to support economic development and prevent undue property tax burden on our residents.
However, some prognosticators are predicting gloom and doom for our brick and mortar retailers as COVID-19 accelerates the growing move toward more e-commerce. But, is that a reality? Recently, I have seen compelling data that indicates that brick and mortar retailers are not a dying breed but are merely transforming and morphing with new customer demands.
To understand some of these shifts, an important term to understand is “omnichannel.” This term relates to the type of retail that integrates the different methods of shopping available to consumers, e.g. online, in a physical store or by phone.
Our brick and mortar retailers who are being most successful have expanded their online presence to capture additional consumer revenue streams. This became a lifeline for them during our Spring 2020 business shutdown.
Ironically, many internet retailers are seeing the need to open physical stores. One example is the Amazon Fresh Grocery that will be opening soon in the former Dominick’s location at Route 59 and 95th Street.
Other familiar internet brands opening physical locations across the U.S. include Wayfair, Bonobos and Amazon Go. Many of these previously internet retailers have captured extensive analytics to know where their customers reside and what products they are most interested in buying. They can be strategic in where they locate and be able to capture the new foot traffic that a physical presence affords. *
Another trend is that stores will have a smaller footprint overall. Since they have the on-line and ship to store capability, they will no longer need expansive shopping space. While some our familiar brands like Sears, JC Penney, and K-mart with a large footprint may be disappearing, the demand is high for retailers who can offer a unique shopping experience. Retailers who provide a “treasure hunt” experience will continue to find success along with value-focused mass retailers (supercenters, warehouse clubs, outlet centers, etc.). *
Shopping malls are being redeveloped to add apartment buildings, medical offices, hotel and entertainment to create a live, work, play environments. We are seeing this at the nearby Fox Valley Mall redevelopment plan already in the works. *
While no one has a crystal ball to know exactly what retail will look like after COVID-19, I find these new trends fascinating to watch.
As always, if you want to discuss this issue further or our advocacy work to support the entire business community, please reach out to me at (630) 544-3387 or firstname.lastname@example.org.
(Data Sources: Al Rosenbostel, Managing Principal, ARC Real Estate Group and John C. Melaniphy, Director of Economic Development, Village of Niles)