Walkable West Palm Beach

How to make downtown retail work? Lessons from Robert Gibbs

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Delray Beach held the sixth and final “Town Hall Lecture Series” last night. Fantastic lineup of speakers and I’m very impressed with Mayor Glickstein’s leadership. Robert Gibbs, renowned urban retailing expert, was the presenter. We previously covered Robert Gibbs after his presentation at the Chamber of Commerce breakfast at the Breakers.

More than anything, the talk gave me an appreciation for the science of retailing. Retailing is all about getting shoppers to open up their wallet and psychology and human behavior are meticulously studied to maximize money spent. Retailers know that when you enter a store, the first couple steps you are adjusting to the light and merchandise is not placed immediately at the entrance. A dark wall at the back of a store makes it more likely you will walk to the back of the store. Any merchandise placed lower than two feet off the ground is not likely to be bought. People decide in less than a second and a half whether to go into a store, and first impression is critical. Open doors make people twice as likely to enter. The color red is a signal that makes it more likely a shopper will buy an item. And on and on.

Retail trends favors convenience, experience, international chains, luxury malls and outlets, and urban retail. Today, 75% of retail sales happen after 5 pm. Today’s shopper spends money far more quickly than in decades past, getting in and out of stores quickly and spending a lot of money at their favorite brands. Downtowns used to have upwards of 90% market share prior to suburbia. Now, the figure is closer to 2%. Gibbs says a realistic goal for a downtown is to achieve 30% market capture.

There was a lot of focus on parking. On-street parking is critical to making it work, and parking meters are the only way to discourage employees from parking in prime spaces and getting meters to turn over sufficiently, according to Gibbs. Women especially prefer to park where they can see the storefront. A typical metered parking space will turn over 15-20 times in a day and can support one small retailer. Parking tickets are bad because people don’t forget getting one. Make it convenient to pay and extend the meter. Small retail thrives on the impulse buy, and having spaces available to park on the block is crucial. I posed the question to Gibbs: Parallel parking or angled parking downtown? He prefers parallel on main street for aesthetic reasons, but angled parking can work well on side streets.

Downtowns have something that malls do not have: authenticity. But a couple national retailers don’t hurt and in fact help things substantially. A national anchor can boost sales of independent retailers by 15-20% due to increased foot traffic. And retailers know that downtown is ‘in’ and they are adapting their storefronts to downtown in response in order to maintain this sense of authenticity. Banana Republic in urban settings:

People come downtown for the experience and giving them a superb experience is critical. For every increase in walkability level, there is a nearly $7 per square foot increase in rent. Important elements of placemaking: Proper awnings of high quality material, A frame signs are okay if they are handcrafted and well done, and street trees that shade the sidewalk while still allowing store signs to be seen. Kings Street in Charleston is probably the most successful downtown retail district in the country, largely because it gets these details right. Shoppers will drive past 12 Pottery Barn locations just to experience Kings Street. Gibbs loves parklets as a placemaking tool and they’ve been doing them 20+ years. Here is one in Birmingham, MI, a very successful shopping district:

What NOT to do in downtown retail

  • Dead zones where the street isn’t activated (blank walls, the 400 block of Clematis on the north side). People stop walking if there is 50′ or more of dead zone. I bumped into Lois Brezenski last night who relocated from the 500 block to Atlantic Avenue in Delray. It just wasn’t working on the 500 block and I suspect a reason why is the dead zone on the 400 block north side. Walk the north side of this block and you will notice it.
  • If retail rents become too high that the only thing supportable is clubs and restaurants, you risk becoming solely an entertainment district. This can lead to a downward spiral in residential quality of life and negative effects for the district.
  • Do not lose your anchors. This can be anything that brings people downtown who otherwise would not be there. A library, City Hall, courthouse.
  • Do not force the retail.

Little known is the fact that Kings Street in Charleston is basically owned by one master developer who controls the experience, much as a mall owner would. Downtowns by and large don’t have this advantage. Aside from this, downtowns can compete by forming a cohesive retail strategy and excellent placemaking standards. Gibbs says Downtown Development Authorities have three essential jobs: 1. Get people to come downtown 2. Get them to come into store 3. Get them to buy something. Retail is the riskiest asset class in real estate and trends can be fickle, but successful downtown shopping districts can happen with the right strategy.

Oh. Don’t do this with your storefront. This merchant tripled his sales for $150 when Gibbs made a few simple suggestions.

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3 thoughts on “How to make downtown retail work? Lessons from Robert Gibbs

  1. Great reporting on the presentation you captured everything from last night. WPB can benefit from last night’s discussion.

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  2. Thanks. We really do have to meet up sometime. I took one of those executive short courses at Harvard about 10 years ago and Gibbs taught the course. I remember asking him about the threat of on line retail to brick-and-mortar stores. His answer then was that people will always want to see, sample, try on the goods they are buying. Now some stores are merely showrooms for on-line buyers. I am sorry I missed this talk and wonder how he would answer the same question today. He was also brought in by Treasure Coast (TCRPC) for a visioning exercise here in Lake Worth a few years ago and had an opportunity to talk to him then as well. He liked Lake Worth’s potential (I sometimes say we kill ourselves with our potential) but pointed to an area between the two RR tracks. He thought that with Palm Beach County’s strong demographics and the fact that area will be sandwiched between two transit stations eventually made that the place smart money should be put in Lake Worth. Looking at that area today still makes that difficult to envision.

    And, as far as downtown Lake Worth is concerned, for better or worse we have become an entertainment district more than a shopping area. I hope his other predictions about areas of that type do not come to fruition.

    Nice write-up.

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    • Good question. I’m not certain how he would answer it, but after seeing him speak several times in the last 6 months, I would infer he would say online is a threat, but one that can be overcome by excellent experience. This kind of shopping is impulse buying — a shopper buys an item because it is part of an experience at the place, even if that item is the same Polo sweater that could be bought back home, it will remind them of vacation when they wear it, he said. Placemaking and getting all the details right, making the street a place where people want to come, and then getting shoppers to enter a store are critical. He says not to be afraid of some national tenants because they are anchors that boost adjacent small retailers.

      I was left with the impression that retail on main street is very hard to do, but is possible. It can’t be forced, and unless a lot of other prerequisites exist, it won’t work. WPB struggles with the entertainment district image as well. Interestingly, it’s now Cityplace that is having that problem, as I recently heard Banana Republic, GAP, and Chicos are all leaving Cityplace soon. I wonder if this might actually help bring retail back to Clematis, as it once had a BR and a GAP I believe right on Clematis.

      Thanks for the comment and yes, we do have to meet up!

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