Posted onMay 29, 2025|Comments Off on I LOVE THE MOVIES!!!
The smell of buttered popcorn, the cool sensation of frosty Pepsi in my mouth, and an afternoon of escape into a new and exciting world, this is what the movies meant to me. As a kid, I spent endless hours on these magical, plush red seats.
For years, cinemas were our first and most affordable choice for entertainment. Movies were the anchor for some of the best retail in the United States, aping the days when we went downtown for all our entertainment, be it a shopping trip, a movie, a delicious dinner at our favorite restaurant or maybe even a play. While many of us are not old enough to remember those days, they are certainly the model for modern entertainment districts.
Not surprisingly, the Pandemic, streaming, and other technology that allows entertainment and games in the palm of our hands have significantly affected the cinema industry. The North American Box Office Gross (NABOG) in 2023 and 2024 was between $8.5-$9.0 Billion, a drop from the Pre-Pandemic era of $11-$12 billion or approximately 70%. But even before the pandemic, NABOG was not growing, but hovering, as shown below:
Source: BoxOfficeMojo.com by IMDbPro and JB Research Company
In the last 40 years, 1984-2024, compound annual growth rate of cinema revenue has been 2.8%, while the population of the U. S. has increased only 1.0% on the same basis. As a reference, the North American Amusement and Theme Park gross revenue increased at a rate of 5.0% per annum in the past 26 years. Remember, inflation has been 2.6% in the past 26 years, so the real rate of growth is 2.4% for Amusement and Theme Parks. Adjusted for inflation (2.6% for the past 40 yrs.), cinemas revenue has been fairly stagnant in the period. This is a somewhat disappointing point of view.
What are a few of the reasons for stagnation, even prior to the Pandemic:
Technology, including television even before streaming became available to all.
Shifts in consumer behavior and preferences
Shifting Demographics, including the aging of the U. S. population
The availability of quality film product and again, preferences of the moving going public
Over screening
With all of this disappointing news, there are some bright spots on the horizon. First, theaters are seeking to change the business model. While almost half of cinema revenue still comes from ticket sales, other revenue streams are growing. Some new points of differentiation include:
The availability of premium large format screens
Enhanced seating
Enhanced Food and Beverage, including the highly profitable sale of alcoholic beverages
Adoption of theaters as public assembly facilities offering opportunities for live events, gaming, sports, opera, kids movies and other programming.
I grew up going to the movies as a special treat. In my heart, I hope that theaters can evolve with the times and remain as sparkling, special places where one can lose oneself in a special environment for a few hours. Lord knows we need these safe escapes in our very chaotic world!
Posted onJanuary 27, 2025|Comments Off on Exploring Boomer Spending Trends: Insights for Marketers
Unlocking the Spending Power of Boomers
Americans are a diverse group, and their spending reflects it beautifully. Look at the picture above and the chart below and you will discover that Boomers spend the lowest of overall per capita, but they rival Millennials in their entertainment spending. Yet when you casually observe advertising in any format, digital or print, you rarely see a senior enjoying themselves on an adventure tour, or on an expensive trip to a theme park. Doesn’t make sense!
The percentage of global population by demographic cohort and estimated spending shows a similar situation:
Generation
Share of population (2024)
Global spending (2024)
Gen Alpha
19.5%
10.6%
Gen Z
24.6%
17.1%
Millennials
22.9%
22.5%
Gen X
18.3%
23.5%
Baby Boomers
12.1%
20.8%
Greatest and Silent Generation
2.6%
5.5%
Understanding these percentages assists in understanding the social and economic impacts that each generation has on our industry.
When comparing the population percentages with spending percentages, the following observations can be made:
Baby Boomers: Although they make up 12.1% of the population, their spending represents 20.8%, highlighting their substantial economic influence.
Millennials: Represent 22.5% of the population and their spending is almost the same.
Gen X: Consist of 18.3% of the population but account for 23.5% of spending. This generation shows a higher spending power relative to their population size.
These comparisons reveal that while some generations may have a smaller population size, their economic impact through spending can be disproportionately large, reflecting their purchasing power and consumption patterns.
Boomers, despite being the lowest in overall per capita spending, rival Millennials in entertainment expenditures. They enjoy expensive vacations, gifts for family, and trips abroad, highlighting their substantial economic influence in the entertainment sector.
How often do you see an ad for anyone over 65 doing anything but taking drugs? But they have money and spend money on expensive vacations, gifts for their family, and trips abroad.
If you are concerned about your return on investment and you are in the entertainment field, why aren’t you pitching to this group? Just common sense, don’t you agree?
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Posted onJanuary 12, 2025|Comments Off on Reviving Community – New Trends in Location Based Entertainment
Now more than ever, we need places for people to congregate and connect. With every lifestyle, regional, and community center showing big empty spaces from tenants that have gone dark (due to Covid-related loss) or just bad management and strategy, innovation is the key to rebranding and renewed Covid has been catastrophic for business with major shutdowns and the explosion of e-commerce.
But some things can’t be replaced, and I believe will never be replaced, such as the need for connection and communal gathering places. The isolation and emancipation screens bring for young and old elicits a more urgent need for human contact. As good designers, developers and owners, we can provide interesting, exciting and innovative experiences, and we can bring visitors back to our shopping centers.
The genres of new concepts are as old as the shopping centers themselves and as new as technology will allow. Here are some of the notable Location Based Entertainment (LBE’s) we think are reinventing the genres.
Eataly
Eataly is the delicious Italian gourmet food market/food court on steroids, with 10 locationsin the United States, including New York and Los Angeles.
Eataly is a global operator in Italian food, offering a concept combining high-end Italian food restaurant with retail.
Eataly’s business model was built around the “eat-shop-learn” concept, offering consumers globally a selection of high-quality Italian restaurants and retail experiences with an overwhelming variety of the finest Italian local “specialties” often impossible to buy abroad.
Eataly operates 27 directly operated flagship stores (14 in Italy, 10 in North America and 3 in Europe) and 26 franchised stores located in the Asia Pacific countries and Middle Eastern region, generating revenues of over €800 million globally (including franchise store sales). This indicates average store sales of £15 million per location.
Eatertainment and Sports
I hate the word Eatertainment, but it has become common in our lexicon. The concept involves combining eating and drinking with fun, sports and games. Anything from baseball to golf to bowling to curling (yes, curling!) are tapped to be themes for these venues, which fit nicely into a retail or mixed-use project.
The first class includes many new restaurants which offer simulators for popular sports such as golf and Formula 1 car racing. Top Golf is the most popular sports themed venue with the highest number of units and top grossing sales per unit of the new sports/food/beverage concepts. This concept combines golf simulators and games with food and beverage. The company offers more than 100 plus units with total sales of almost $1.8 billion, average sales per unit of $17-$18 million on newer units sized at approximately 65,000 square feet. Gross margins are known to be about 40%, indicating an EBDITA of $6.8 million. With an industry standard payback of four years, this indicates a warranted investment of more than $27 million, or $415 per square foot. This is the most proven and mature business model of the sports/food & beverage models.
Other models include:
F1 Arcade is based on iconic Formula One racetracks and is offered in Boston, Washington DC, Las Vegas and London. Featuring craft cocktails and seafood, Kobe beef, and bar fare with an upscale theme, the venue allows entrance to customers from 7 years of age and older. The Boston unit is approximately 16,000 square feet. Kindred Concepts, the parent company, recently raised $130 million in financing for expansion.
Camp Pickle is scheduled to debut in Denver and Tulsa in 2025. This new attraction will be like an old-time summer camp, the kind your grandparents attended. Of course, Pickle Ball is the theme, and food beverage and other activities are offered.
Spin is a concept created by Susan Sarandon in New York in 2009, themed on competitive ping pong. With locations in New York, Boston, Chicago, San Francisco, Toronto, Philadelphia, Seattle and Washington DC, the menu provides farm to table, locally sourced food. Units range in size from 4,000-12,000 square feet, fitting nicely into a shopping center configuration.
SixesSocial Cricket offers competition in a sport that many Americans know nothing about… Cricket, with karaoke offered as backup! The food is said to be excellent, featuring typical bar-fare. Bookings include an adjoining table for food and beverage. The first U.S. unit is in Dallas at the Colony.
Goodsurf is an 8,000 square foot sports restaurant based on surf simulator technology that allows waves to be created by machines, taking much less space than a typical wave pool. Food offerings include burgers, fries, vegetarian options, and ice cream for the kids. The first location is in Dallas.
Flight Club is a high-tech dart simulation game with seven units located in the United States in Las Vegas, Denver, Atlanta, New York, Los Angeles, Houston, Boston, and Chicago. The food offerings are gourmet versions of flat breads, tacos, salads and fries. The newest unit is in Denver at 10,000 square feet, close to Coors Field and the Ball Arena.
Culture
My favorite in this category is Meow Wolf, which began in 2008 as a collective of anarchic artists in Santa Fe (NM). It offers interactive installations, each with a different theme. The attraction offers six locations including Santa Fe, Las Vegas, Houston, Washington, and Denver. Each location has a different immersive art theme with hundreds of storytellers from throughout the world and local artists’ features.
The newest and largest store is located in Denver and features more than 70 immersive attractions in 90,000 square feet. (The Houston location is only 32,000 square feet.) Convergence Station, as it is called, is a multiversal travel experience between four alien worlds, inspired by the location near two freeway overpasses.
The newest store is scheduled to open in 2026 and is in final lease negotiations that will bring a Meow Wolf exhibition to West Los Angeles. The location is a vacant movie theater complex. The theme will be cinema. Meow Wolf’s move into its largest market yet is intended as a statement piece, a declaration that weirdness and art-focused ventures still have a place in an immersive economy that’s been racked by closures and layoffs, Meow Wolf included.
In April, Meow Wolf announced it would cut 165 employees. Exhibitions in Denver and Las Vegas were heavily affected.
General admission is $40 for adults and $35 for children and passes are available. The business model is based on buying/leasing low value properties in subsidy rich locales.
Destruction LBE’s
Can we talk about Las Vegas, the lab for all new location-based entertainment? How about Dig This, with an admission price of almost $205? This is a wrecking lot with real earth-moving machines, caterpillar D5Ks, bulldozers, and mini excavators. With instructions being the first step, a neon yellow vest and a hard hat are provided with in-cab training. Then, you get turned loose to wreck real things like a car! This is about the most male-oriented attraction of those researched!
Adventure and Technology Driven Formats
Location based virtual reality is a whole world unto itself with a following that includes mostly young boys and men. But the industry is making a Location Based-Social interaction with games to engage the consumer in a community experience. Some of the themes include war, exploration, and adventure. Research shows that female consumers are loving some of these group games, those that don’t require you to keep a body count!
(Now maybe I’m old-fashioned, but explain this to me. A whole bunch of your friends put things over their eyes where they can’t see each other nor speak to each other, nor touch each other. These are group games that seem to me to be a totally weird way to connect. Just this consultant’s opinion, but I think we have lost our way in terms of entertainment value and the sense of connection that is required to be human!)
Still, one concept is killing it!
Sandbox VR is a location-based concept out of the UK and Ireland, with two locations in the UK (one in London, one in Birmingham), and 31in the United States. Of these, seven are in California, one in Chandler (AZ) and another in Mall of America (MN). The average spend is £37 in the UK and $55 in the United States. The UK locations earn between $1.9-$2.6 million, with an EBITDA of 35%. Capital expenditure on the equipment ranges from $500,000-$750,000. Buildout of the average 5,000-6,000 sqft location ranges from $1.5-$3.0 million, cost of which is borne by the lease and/or can be negotiated with the landlord. The games are story driven and can change constantly. Collaborations with Netflix and Paramount are planned to provide content.
At the writing of this blog, Sandbox VR launched a game based on Netflix’s Zack Snyder’s “Rebel Moon.” This experience has players “gear up with their fellow rebels for battle against the ruthless forces of the Motherworld’s military,” per the game’s description. “Inspired by the vision of legendary director Zack Snyder, players become members of the resistance and are transported to the planet of Daggus, descending through skyscrapers, streets, and a subterranean mine while they defeat enemy soldiers and spacecraft.”
With the development of operating economics reported, this is one of the first VR experiences to complete a “proof of concept” and earn economic industry-standard return.
Intellectual Properties
My favorite location-based entertainment center based on an IP is the Crayola Experience. This format is based on (what else) the iconic Crayola Brand, with the flagship attraction in Easton (PA), where the factory and headquarters are located. At 65,000 square feet, and with lots of colorful activities to do, the attraction boasts an adult/child entry fee of $26.99. Other locations include Chandler (AZ), Bloomington (MN), Orlando (FL), and Plano (TX). Activities offered are very creative such as the Activities Studio, The Cartoon Creator, and the Adventure Lab.
In 2022, the brand began a licensing concept. The growth strategy presented in 2022 includes extending the location-based entertainment footprint domestically and internationally. “We are now looking to develop licensing partnerships that bring new capital and expertise to accelerate our LBE expansion, particularly internationally where local market access and expertise are important,” said Victoria Lozano, Executive Vice President Digital Strategy, GM Attractions & Retail for Crayola.
The first Crayola Experience opened 25 years ago as The Crayola Factory in Easton (PA). Crayola saw an opportunity in LBE and in 2013 reimagined the downtown attraction as Crayola Experience. The company also owns and operates Crayola Experiences in Orlando (FL), at the Mall of America in Bloomington (MN), in Plano (TX), and in Chandler (AZ). With venues ranging from 20,000-60,000 square feet, Crayola Experience engages more than 1.5 million kids and adults annually in activities inspired by/and incorporating proprietary Crayola products and technologies.
Crayola is continuing to develop creative concepts that will help scale its events and exhibitions LBE business. Early this year, Crayola debuted IdeaWorks at Philadelphia’s Franklin Institute, a traveling exhibition encouraging families to explore innovation, invention and design thinking. The company also collaborated with OceanX, a global ocean exploration nonprofit, on a national takeover tour of the Crayola Experience venues that began this summer and runs through summer 2022.
Other notable concepts of IP-based LBE’s include the LEGO Discovery Centers, branded popup retail locations with characters such as Barbie and Peppa Pig. Today, studios and other IP owners are monetizing their brands by creating places where their properties can be owned or licensed out to the LBE owner. One great example is MONOPOLY LIFESIZED, created by Habro (self-explanatory), and Sony has opened a division to license its intellectual properties for developers.
Other retail pop-ups with a brand LBE include Hello Kitty pop-up cafes, the Rolling Stones pop-ups, and the Barbie branded sales areas at Selfridges in London.
Conclusion
Most of the examples presented must continue proof of concept and financial goals. We hope many will stand the test of time and blossom to enrich our industry!
What are your favorites? Let us know, we always love your input and experiences!
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Summer is a time for fun, for vacation, for surfside romps, for visits to the county fair, for baseball games, for seeing friends and drinking wine. This summer was both the same and also very different. While I did all of these things, I did it with family, my big noisy crazy, dysfunctional family including husband, kids, grandkids, sibling and of course in-laws and extended family. But we didn’t go to some exotic island where the summer sun shines 20 hours a day, nor did we jet off to African for a Safari (which is still on my bucket list). This summer was the beautiful California locales, all close by. The summer turned out to be the “summer of love”.
Family vacations evoke all sorts of images, like group cooking in an always beautiful Italianate kitchen, grandparents playing with tiny humans who may look like them, sisters romping on the front lawn doing cartwheels, kids fighting and hitting each other, and many secrets which are best left unshared. But at the bottom of all these images is the reality of spending time with the only people who provide unconditional love, who look like you, who know what you have been through because they have been through it too.
This year was especially memorable for me because my tiny doppelgangers, my grandkids, were old enough to be out of their parents arms, and become their own little people, able to play and love independently.
And because I have rewired my brain, and practiced becoming my best self, I was able to be there and enjoy these precious moments.
It all seems so simple, so natural, so “yeah, of course that’s what happens”, but in fact this is something extremely difficult, requires hard work and is entirely new to me.
Ten years ago, in about 2004, I got a call from a prospective client, a newly hired director of the Academy of Motion Pictures Arts and Sciences museum project, asking if I would be interested in conducting some market research for a new attraction/museum themed on the Academy Awards.
Would I Ever!!!
I had been the one lucky enough to do the work for the Dolby Theater at Hollywood & Highland where the ceremony takes place, so it seemed a good fit and logical that I continue on to do the museum feasibility. But my joy, my heart, for Hollywood, no one knew that!
No One Had Ever Known That:
My family had always been in the entertainment business, with my father involved on the business side, having been a pioneer in the cable television industry.
My aunt always working for this or that movie star as an executive assistant.
I was lucky enough to visit the back-lot of 20th Century Fox before it was Century City!
I spent countless hours watching movies being filmed, then sitting in theaters watching them roll by me on the big screen.
Would I be interested? Heck, yea!!
Since that time, I have been the consultant called upon to do the background market research, analysis and financial projections for the site selection, sizing and operation of museum.
I learned a thing or two during those years like:
I gained a deep knowledge of large museums and what keeps them thriving.
How an endowment can shrink during a deflation.
Money earmarked to never-be-touched has a way of disappearing in hard times.
I learned about the conundrum of keeping things fresh so that resident visitors will keep returning, time and again.
I am thankful that my job always changes and that I always learn, no matter the engagement.
Over the years, we have wrestled with all the issues associated with new development including disagreements about what it should look like, what its mission should be, where it should be sited, who is its targeted audience (please, don’t say everyone!), and what’s the best way to keep the project on-time and on-budget. To be clear, these issues are complex and are made more difficult when there are many masters to serve. Still, when the project is to reflect the points of view, hopes, dreams, and legacies of America’s most important cultural export, (which I believe is cinema) there must be the most careful consideration to each one.
This was my best job ever. Write and tell me about yours in the comments below.
Posted onJanuary 9, 2015|Comments Off on Entertainment Evolution Experience
Happy New Year Friends!
I can’t believe so much time has passed since I last wrote. We have been very busy and had a lovely holiday. Hope all is well with you and your family.
We are reminding you to come and join us at an exceptional conference “Entertainment Evolution Experience” to be held February 18th and 19th at LA Live! in Los Angeles. I will be speaking on a panel entitled, “Open Air Projects – Pushing the Envelope,” where we will discuss, among other things, the need for human contact and fresh air!
We would be thrilled to see you there!
Here are the details:
Shopping Center Business and InterFace Conference Group are pleased to highlight the following panel for the Entertainment Experience Evolution Conference, February 18-19, 2015 at LA Live in Los Angeles. The multi-day conference will focus on what developers, owners, restaurants, retailers, cinemas, designers and entertainment venues are doing to evolve the consumer experience and create vibrant places to spend time.
Featured Panel:
Open Air Projects –
Pushing the Envelope
Arguably the most active type of multi-tenant retail, open-air centers have grown beyond service retail to become true community environments. Find out how amenities, restaurants, landscaping, hardscaping, and placemaking are changing open-air retail. See case studies from developers and architects on the transformation of open-air centers, from regional lifestyle centers to power centers to small community centers.
Posted onJune 25, 2010|Comments Off on Understanding Your Market – By the Numbers
Analyzing demographics and psychographics is an incredibly useful tool to assist in every aspect of feasibility testing, new product development, and simple site selection. The process used to be cumbersome, and not for sissies! But since the advent of MapPoint, almost anyone can do a simple version of a demographic exercise.
The Beneficial Business Features of MapPoint:
MapPoint has an incredibly easy demographic feature. Choose up to 16 different demographic points at once – such as population, income, household size, and age – and then instantly MapPoint arrays these features by state, county, city, MSA, zip code, or even Census tract.
A shaded map will show the various areas by any single demographic chosen – such as number of businesses per zip code, teenagers in a particular census tract, or household expenditure patterns for any city in the United States.
Once the demographic factor is selected and mapped, a radius of any number of miles around a site can be created and then instantly exported to an Excel Sheet. With the numbers in Excel, manipulating data to get a clearer snapshot of the type of customers in or around the site is simple.
Radii can be adjusted, expanded or a second radius created and then re-exported for a new area into another Excel Sheet. By simply copying and pasting new numbers into the first Excel sheet and repeating for other locations or radii, an instant comparison of multiple locations is created.
MapPoint can also find and map competitors. The map will not only list a fairly accurate number of competitors within a preselected distance from your business, but it will also pinpoint the exact distance of a business from your site, as well as their address and phone number.
You can import data from an Excel Sheet, and thus map multiple addresses. This is an ideal tool to determine where the customers on a mailing lists are actually located.
Another useful feature in MapPoint indicates expenditure per household for various products such as electronics, books, food, etc. This information can also be narrowed to a particular radius and census tract, thus allowing a better picture of how much money people in your area spend in a year on your products.
Plus, on top of all that, MapPoint offers a GPS tool, and driving directions can be created based on shortest distances, preselected locations, and fastest routes. It can also calculate the cost of gas required to visit those locations.
BELOW IS A MAPPOINT INCOME DIAGRAM FOR A LOCATION IN GLENDALE
Glendale Income Map
Very simple. But you might have some questions. If you do, call or email me. (jill@jbresearchco.com, 805-640-1060) I’ve been doing this for 20+ years, with or without MapPoint!
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Recently, I participated in a round table discussion with other retail experts in Southern California. Shopping Center Business just published the following article about that discussion entitled “Revealing National Trends.”
Feature Article, May 2010 – Shopping Center Business
“Revealing National Trends”
Southern California Roundtable leads to discussion of trends that can be applied nationally.
Roundtable moderated by Jerrold France and Randall Shearin
Shopping Center Business held a retail roundtable hosted by Holland & Knight at the City Club on Bunker Hill in Los Angeles.
Shopping Center Business recently held a retail roundtable in Los Angeles, hosted by the law firm of Holland & Knight at the City Club on Bunker Hill. Attendees of the roundtable were Pat Donahue, Donahue Schriber; Sandy Sigal, Newmark Merrill; Jill Bensley, JB Research Co.; Jeff Kreshek, CIM Group; Bill Stone, Excel Realty; Jeff Green, Jeff Green Partners; Mark Schurgin, The Festival Companies; Greg Lyon, Nadel Architects; Julie Brinkerhoff-Jacobs, Lifescapes International; Tamsen Plume, Holland & Knight; Karl Lott, Holland & Knight; and Susan Booth, Holland & Knight.
SCB: Southern California is an important market as a lot of retail trends are created here. What do you get as an overall sense of the market here?
Donahue
Donahue: We are better off than we were a year ago. There were relatively no transactions last year. Things are starting to thaw out. We have exposure to four states and Southern California held up much better than Northern California, Arizona, Nevada and Oregon. Our occupancy in Southern California is even with a year ago, where our portfolio is off 400 basis points. Our rents in Southern California year over year are flat to plus two, versus a portfolio that was negative 11. Out of our entire portfolio, 80 percent is in California.
Stone: Our concentration is in the Southeast [United States]. The Southeast has been better; we have a number of centers there at 100 percent occupancy. When you go to the centers, not only are the parking lots full, but there restaurants are full. There are not as many people shopping out west. The whole country has been waiting for the other shoe to drop. In California, everyone is worried about the state. There has been some hesitation here on the part of people to go out and spend. People are holding their money.
Bensley: I looked at the personal savings rates back to the 1960s. This year, the savings rate is 3.3 percent, and that is down, which is good for the shopping center industry because consumer spending is two-thirds of our economy. Last year, it was about 5 percent. In 1991, during the last recession, the savings rate was at 7 percent. In the 1980s, it was at 10 percent. It just shows you the transition of what we’ve done in taking out money from our homes. That is where all that money came from. It was the spending of cash that was then all lost with the value of our houses.
Donahue: We, as a country, took on more debt in the last 7 years than in the previous 40 years combined.
Bensley: It is astounding. It is bad for retail when people save more, but at some point we have to even out.
Donahue: If we go to what we were doing, we will all be out of business. We have to have a positive savings rate. The idea that you are supposed to live above your means is not good. I’m thrilled we’ve shifted to a positive savings rate. It is going to wreak havoc on our business, there’s no question, but it is going to weed out the people who shouldn’t be in this business. Circuit City, Linens ‘N Things and Mervyn’s only lasted 12 months in the downturn. These aren’t retailers who weathered the storm. They shouldn’t have been in business when they were. This recession is weeding those players out. At the end of the day you will come back with a much stronger economy, a much stronger country, and consumers who are doing the right things. We can’t be leveraging ourselves into this.
(Left to right) Stone, Schurgin and Sigal.
Sigal: A lot of the retail failures were a function of the credit markets shutting themselves off. We are seeing a return of some financing to the marketplace. There are the haves and have nots — there are tenants who have access to the capital markets and the REITs who have access. The have nots are just holding on for dear life. If their debt gets called they are done. California is such a large market, you can’t say ‘California is recovering.’ We have centers in the inner city, denser communities. That customer has continued to visit because there is nowhere else to go. Our tenants are the 99 Cents Only and the discounters. In this kind of environment, their marketplace has grown. They have the base who has no one else to go and they have a new group of shoppers. A lot of people will discover retailers like Walmart, K-Mart and Target, and once they discover it, they will keep going. Our L.A. region has seen no increase in vacancy. We are still at 95 percent. In San Diego, we’ve been affected; we are 400 basis points worse there, just around 90 percent. It is a function of high rents and it is dependent on the housing market. The Colorado market has been our best market. It has been steady…
As a corollary to my last blog, I am thrilled to provide a recent real world and personal example of a first class retail experience I had with the group that owns the “Cheap Chic” category. Of course, I am talking about Target. My husband, older son, and I were on my birthday trip to Truckee to visit my youngest son. We weren’t leaving until 9PM because of family scheduling nightmares. We decided to split the 10-hour trip from Ojai, in Southern California, to Truckee in Northern California into two legs. For the first leg, we would drive about three hours to stay in San Luis Obispo (SLO), made famous by a recent episode of “The Bachelor.” (Don’t lie; you watch it just to see how awful Vienna will be, what slutty and inappropriate thing she will say, and how much she will embarrass herself when Jake isn’t looking.)
We took off at 9PM on a Thursday evening. I had two bags packed – one with my essentials (make-up, shades and meds) and one with my clothes. I always count on my husband to pack the car. (That’s the man’s job, right?)
So we took off and spent a lovely first night in a SLO hotel where I only brought in my “essential” bag. The next morning, after a good night’s sleep and an early start, we went out to the car to begin the next day of our journey. We put all the bags in the back of the 4Runner and I noticed we were short one bag.
“Did you pack my red rolling bag?” I queried Charley, my husband.
“No, I thought you had everything in the ‘essentials bag’!”
“Are you kidding me!??” Has he met me? I am extremely high maintenance. When I travel, especially to a cold place, I bring along coordinated outfits including no fewer than three pairs of shoes, no matter how short the trip. And I am not one of those people who can do black, white (or tan), and one additional color. Oh no, I need the pink shirt, the red sweater, a couple of jackets, etc, etc.
There I was, on my birthday trip, with no clothes! And I was wearing ratty old sweats (for the drive), and a pink sweater and jacket from Sears! (Remember my last blog about Sears? This is what I bought along with a pair of red sandals that I, incidentally, didn’t bring to the snow. Oy vey!)
So I stressed for a few minutes and then decided what the hell – there was nothing to be done, another excuse for retail therapy!
Now realize – I had no clean underwear, no socks, no sweaters, and nothing dressy for my birthday dinner… nothing but what was in my essentials bag. And we were traveling on I-5 through the Central Valley of California, not really a stopping mecca. Not a Nordstrom to be found along the way – not in Stockton, not in Modesto, not in Sacramento, nowhere!
“Why don’t we look for a Wal-Mart?” suggested Charley. “We can have lunch and you can get what you need.”
Again – have we met?
But then I got the bright idea. “Let’s look for a Target!” They are my favorite when I go ‘cheap shopping,’ which is a bunch more often since the recession hit.
So we looked for the distinctive logo (which up until then I didn’t realize was a real target!). When we found one, I was thrilled. I was on a mission to get a whole trip wardrobe for under $150.
What would I need? Underwear, jeans, black tops, and a pair of black sweat pants. Remember, I had jackets and shoes, so I was good in those areas! While the boys went to get lunch at the Starbucks in the Target, I picked out two pairs of jeans, a black tank, a black paper-thin long sleeve tee, a black cotton V-neck sweater, three pairs of undies, and a new comfy pair of black sweats. All fashionable, all reasonably well fitting, and none of them cheap looking! I am thrilled to say, I wore all the pieces for five days on the trip, even to my fancy birthday dinner!
And so here’s to you Target, for saving my birthday trip, and being the best in class. Oh, and by the way, I had a ball with my husband and two boys, a trip to remember, uninterrupted by a forgotten suitcase.
I love to shop. I’m talking about reason to live, first thing you think about in the morning, when can I go again love! I guess that is why I have been a retail analyst most of my adult life. So I consider shopping, retail, the shopping ambiance, the retail experience, whatever we call it these days since the recession, I consider these my avocation and my vocation. I am an expert!
My mother imparted this love to me, as is the case with most girls. It is imprinted on us like little ducks from an early age, this need to gather, to get the prettiest, most current, loveliest shoes, sweaters, pants, skirts, purses, that we can afford. And as a corollary, there are certain shopping rules, again imparted by our mothers. For example, my childhood in an upper middle class suburb of Chicago, taught me that there were only a few department stores where we were allowed to shop for clothes: Marshall Fields and Carson Pirie Scott. WE WERE NOT ALLOWED TO STEP FOOT INTO SEARS! Now I know this is deathly un-PC and there were not a boatload of clothes to be had at Sears back then, no “softer side of Sears,” still we were not allowed to step foot into the store on a girls shopping trip.
When I became a retail analyst, that had to change, but I still have the “No Sears” song in my head. As most of us know, Sears has done quite a bit in the last ten years to deserve my scorn. They have made many decisions, none of them based on being a great retailer. Considering the ruthless competitive landscape in retail, it’s a miracle that Kmart (who now owns Sears) has survived. Tough rivals in the discount segment abound, including WalMart Stores, Target, and Costco. All three of these behemoths have much stronger brands and customer loyalty than either Sears or Kmart. And regardless of whether hedge fund manager and Sears chairman Eddie Lampert is involved — his mere presence often seems to make some investors consider Sears’ future as a hedge fund, not a retailer — Sears and Kmart both lost their brand luster many years back.
Why am I blogging about Sears today? One thing Sears had going for it way back when was its great brand of appliances, ease of shopping for them, great repair service and service contracts. They were vertically integrated. So all of our appliances are from Sears and they are for the most part, work horses. But when they break, it has been a tear-your-hair-out nightmare to get an appointment for service. We had a minor part break on our refrigerator this summer and it took six visits to get it fixed because they kept sending the wrong part or the service man didn’t show up at the appointed time or they had to cancel or some other excuse that never made sense. It didn’t bother me too much because the refrigerator still worked, although it was very funny to receive a white door for the unit when the refrigerator is stainless steel! (Doors are very big and bulky to mail!)
The last appliance to break was the clothes dryer. I called to schedule an appointment to get it fixed and knew it was going to be a nightmare, but we bought the service contract so we are on the hook with Sears. The agent at the scheduling center told me I had to wait three weeks. I told him that was unacceptable, at which point he pretty much told me to go “F” myself, that I could take it or leave it, that they had no complaint department, he had no supervisor and if he was in my position he would just leave it alone. So I called a local service to fix the problem and sent Sears the bill with a letter of explanation, a very rational letter, and enclosed the repair bill. I fully expected nothing, but I felt better doing it.
Two months later, my husband got a call (in fact now 4 calls) from Sears. He referred the first caller to me. They told me they were extremely sorry for the way I was treated, but they had no control over their repair servicing arm, which of course, they don’t. He told me he would be sending a check for $18.75 for parts (the bill in fact was $100) and that they would be sending me a $50 Sears gift card for my trouble. Will this make me ever consider Sears again for anything? This is called “customer mop-up.”
So here I was with a $50 gift card for a store that I now had multiple reasons not to shop. I tried to force myself into our local store three times before I finally made it. So what was my experience this time, with the 2010 “softer side of Sears?”
I was sad to see that Sears lived down to my expectations. With so many category killers doing a superb job in their niche, they just didn’t do anything well. They didn’t own the “cheap chic” category, they didn’t own the “cheap/inexpensive” category, and oh my god, the quality of the soft goods was abhorrent!
So they have stuck with the warning from my childhood, “NEVER SHOP AT SEARS!” The store carried cheaply made goods (soft and hard), mostly unattractive, AND FOR A PREMIUM PRICE!!!! .
Over the years, we have wrestled with all the issues associated with new development including disagreements about what it should look like, what its mission should be, where it should be sited, who is its targeted audience (please, don’t say everyone!), and what’s the best way to keep the project on-time and on-budget. To be clear, these issues are complex and are made more difficult when there are many masters to serve. Still, when the project is to reflect the points of view, hopes, dreams, and legacies of America’s most important cultural export, (which I believe is cinema) there must be the most careful consideration to each one.
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