Levin Retail Tenants Report Positive Seasonal Outlook, Robust Hiring Plans

Our Annual Pre-Holiday Survey Confirms Digital Marketing Momentum

Results of Levin Management Corporation’s (LMC’s) annual Pre-Holiday Survey of our retail tenants are in and the news is more than good, with respondents reporting robust hiring plans and continued digital marketing momentum. The poll of tenants within our 95-property, 13 million-square-foot portfolio explores year-to-date performance and expectations for the critical holiday shopping season. As regional leaders in commercial real estate leasing we not only welcome these findings, but look forward to more positive retail trends ahead.

Poll Respondents Expect both Sales and Seasonal Hiring to Rise
An impressive 83.2 percent of our survey respondents project holiday sales to be at the same or a higher level than last year. A full 45.0 percent plan to add seasonal staff – well above the average 29.8 percent reporting seasonal hiring in our prior five Pre-Holiday polls (2011-2015).

LMC President Matthew K. Harding, says strong year-to-date performance is behind retail tenant optimism. In fact, 64.3 percent of survey participants reported year-to-date sales at the same or higher volume than at this time in 2015 – compared to the 2011-2015 polling average of 57.9 percent.

LMC Survey Results Mirror Findings of National Studies
LMC tenants are not alone in their optimistic outlook. The National Retail Federation (NRF) expects sales in November and December (excluding autos, gas and restaurant sales) to reach $655.8 billion – an increase of 3.6 percent over 2015. This compares to a 10-year average of 2.5 percent. Similar studies by the International Council of Shopping Centers (ICSC), Kantar Retail and Deloitte project holiday sales to increase by 3.3, 3.8 and 3.6-4.0 percent, respectively. Further, ICSC reports 91 percent of consumers plan to holiday shop at physical stores.

Survey Respondents Predict Early Holiday Shopping Surge
LMC tenants expect their customers to shop early this year. A full 24.0 percent said they anticipate their sales will peak prior to Thanksgiving. Another 23.5 percent expect their sales peak during the Thanksgiving/Black Friday weekend. The balance of respondents’ expectations for peak sales are spread among early December (12.3 percent), mid-December (18.1 percent) and the weekend before Christmas (16.2 percent). Only 5.9 percent expect their peak sales to fall between the Christmas and New Year’s holidays.

Tech-Stacked Marketing Will Rule 2016 Holiday Shopping Season
Technology-centered marketing remains an ongoing priority, say our survey respondents. The Pre-Holiday survey asked those whose companies are embracing mobile apps, social media, email, texting and other platforms to compare their amount of digital marketing year over year. A full 94.0 percent reported they will incorporate the same or more tech-centered marketing this holiday season.

“This is smart planning,” noted Melissa Sievwright, LMC’s vice president of marketing. “Deloitte forecasts that digital interactions – consumers’ use of digital devices such as smartphones, tablets, and desktop and laptop computers – will influence 67 percent of brick-and-mortar sales during the 2016 holiday season. In turn, our tenants recognize the importance of reaching their customers via digital platforms – both prior to and during store visits.”

Email and Social Media are Top Promotional Channels. In-Store Promotions Include Digital Coupons, Loyalty Programs and Discounts
Survey participants who are actively using technology to reach shoppers outside their stores favor email (74.7 percent) and social media (73.1 percent). Other top channels include text messaging (30.6 percent), banner and other internet advertising (30.6 percent), and digital ads targeted to mobile devices (25.3 percent). For in-store reach, popular tools include digital coupons, discounts, loyalty points and/or rapid payment (73.8 percent); free Wi-Fi (37.8 percent); post-sale online surveys (35.4 percent); and electronic receipts (29.9 percent).

Social Media is Strong Element in Digital Marketing Equation
Facebook reports the holiday season brings more posts, shares and comments than any other time of the year. Deloitte notes that social platforms – such as Facebook and Pinterest – are “shaping what people think a great shopping experience is – a fast, highly-curated assortment with access to visuals, information, and buying sources.”

Among survey respondents, Facebook is by far the most popular social media platform, used by 89.9 percent of those who incorporate social media into their marketing efforts. Other popular outlets included Instagram (40.5 percent), Twitter (33.3 percent), Google+ (27.4 percent) and Pinterest (10.1 percent).

“Social is a vital part of the digital marketing equation,” Sievwright said. “Our tenants are using these channels to announce in-store sales and experiences, and for post-event coverage. Instagram and Pinterest, since they are so visual, are popular choices.” An emerging retail trend to watch: live broadcasts from events on Facebook’s Livestream and Twitter’s Periscope.

For the first time, survey participants were asked whether they are enhancing their social media presence with paid options. Of respondents who use social media for marketing, 37.5 percent indicated they are leveraging opportunities like Facebook’s sponsored content or ads.

Our Retail Sentiment research will continue in 2017. In January, we’ll be gauging retailers’ outlooks for 2017, and in June, we’ll report mid-year progress and explore technology issues.

Fasten Your Seatbelts: Generation Z is Ready to Shop

Retail Trend Sees History’s Most Demanding Consumers on the Horizon There’s no rest for the retailer. Just when you thought you’d mastered Millennial marketing, along comes a new wave of consumers you’ve got to figure out. Dubbed Generation Z and 70 million strong, this rising demographic will represent 25 percent of the US population by 2020. It’s time to get ready for what retail trend watchers say will be the most demanding consumers of all time.

Raised Online and Digitally Addicted: Meet Generation Z
Gen Z members are still very young (13 to 18), so it may be difficult to draw too many solid conclusions about their eventual buying habits. But a number of factors are likely to define their future behavior. Consider the following about them:
-First generation born in the 21st century
-Grew up in challenging economic times
-Never knew a world without the Internet
-Citizens of an on-demand culture
-Tethered to technology since their earliest days

That said, a picture emerges of a consumer who expects instant access to everything and who relies on digital resources for discovering what they want and for getting it when they want it. Forty-percent of Gen Z claim they are “addicted” to their digital devices.

Where to Reach The Z’s: Instagram, Snapchat and YouTube
Characterized by their short-attention spans and love of novelty, it’s no surprise that Z’s prefer quick visual communication. Instagram, Snapchat and YouTube are their platforms of choice. In fact, 72 percent say they visit YouTube daily. Streaming movies and music is a way of life for the group – over half do so daily – obviously a result of their on-demand orientation. And gaming is a major focus with a high degree of interest in virtual reality.

Z’s Are Different from Millennials in Surprising Ways
While both these age cohorts are intense social media users, Millennials (age 19-34) are more influenced by it than Z’s. Over half of the older group (58 percent) credit social as a top purchasing driver. Only 53 percent of the younger demo names it as their major influencer.

Millennials, as we know by now, are active reviewers of brands and experiences, sharing their opinions across the social media spectrum. Z’s much less so. Millennials are 40 percent more likely than Z’s to get their viewpoints out. Will the younger group grow into word-of-mouth as they mature? That’s something worth watching.

Gen Z’s were shaped by the uncertain economic environment of the last decade. Despite this experience, they are much less likely to be bargain hunters than the Millennials. The older group is 29 percent more inclined to check and compare prices before and during shopping trips. The Z’s milder interest in pricing may be due to the fact that the majority are not yet living independently. Will they acquire the Millennials’ cost consciousness as they move out on their own? Another retail trend to watch.

Don’t Miss Out on Marketing to Generation Z
Z’s are still in their formative years, but here’s what Deborah Weinswig, managing director of Fung Global Retail & Technology foresees. “Exposure to near-infinite choice and near-endless information makes this generation more demanding than any of its predecessors. As Gen Z matures, it will become more discerning, but its demanding nature is unlikely to be diluted. We think brands and retailers will be the ones that need to change, because Gen Z is unlikely to compromise on its high expectations.” Read more about Gen Z’s consumer demand here.

Yes, today’s tweens and teens will soon be full-fledged consumers with new and unique habits and demands. Savvy retailers should be ready to accommodate them. Sharpen your visual messaging now. Get active on Instagram, Snapchat and YouTube. Stay up to the minute with mobile marketing. Be ready to deliver at warp speed. Develop incentives for the Z’s to follow you on their platforms of choice. A new breed of shopper is heading your way!

For more information on Generation Z:
https://iei.ncsu.edu/wp-content/uploads/2013/01/GenZConsumers.pdf

http://www.huffingtonpost.com/deep-patel/6-trends-for-generation-z_b_11227446.html

Can Pokémon Go Keep Retail Sales Hot Through the Holidays?

Retail Trend Watchers Are Eyeing the Staying Power of Pikachu and Friends
This was the Summer of Pokémon. Within days of its debut last July, Pokémon GO, the augmented reality game was breaking records and setting new ones. In just five days, it became the most popular game in mobile history, with its free downloads eventually reaching 500 million. While the action was concentrated among Millennials (who grew up with Pokémon), teen users were spending more time hunting Pokémon characters than posting on Twitter and Instagram combined. Females, traditionally a smaller segment of gamers, stepped up to Pokémon GO, becoming 40 percent of the user population. Since the game forced players off the couch and into the outside world, there were unintended consequences. Some, engrossed in the hunt, were robbed. A number were arrested for trespassing. Many got traffic tickets, and a few even fell off cliffs.

Pokémon GO Fans Have a Hearty Appetite for Branded Merchandise
When fans weren’t catching and training the elusive pocket monsters, they were shopping for merchandise that reflected their passion. Online sales of Pokémon merchandise were nothing short of spectacular. According to the Adobe Digital Price Index, sales of Pokémon-branded items rose 105 percent in July, compared to the previous year, with the hottest items being video games, toys and t-shirts. But what’s next? Can the frenzy continue into the holiday season? Will bricks-and-mortar stores reap the same success as online purveyors of Pokémon merchandise? Retailers have their fingers crossed and retail trend watchers are optimistic.

The Summer’s Frenzy is Cooling, but the Holiday Season Still Looks Strong
Pokémon GO was too hot not to cool down, but even as usage ebbs, the franchise itself remains a powerhouse. Gina Collins, CMO at Build-A-Bear, one of the stores licensed to sell Pokémon merchandise, is bullish on the coming season. “Sales have continued to gain momentum,” she reported. The chain’s inventory of 20th Anniversary Pokémon Pikachu plush dolls has sold out and there are wait lists for the next shipment.

Anthony Morales, assistant manager at Build-A-Bear in Fairfax, VA, reported that more and more customers are hunting Pokémon-themed items. “It feels like the 90’s all over again. We just had a group of kids that got a lot of Pikachu dolls and they were playing and talking in little Pikachu voices,” he told Ad Age.

Pokémon Items are Headed for the Kids’ 2016 Holiday Wish List
Pokémon fans can choose from an abundance of branded merchandise in the coming season: plush toys, clothing, accessories, and action figures, along with the Pokémon card game. Late November will see the launch of two new video games, Pokémon Sun and Pokémon Moon, likely to be best-sellers in that category this holiday.

Toy Insider predicts that “the Pokémon GO craze will command a lot of space on kids’ wish lists.” Their own Hot 20 List for 2016 includes two Pokémon-themed products. At the number nine position is Pokémon My Friend Pikachu (from Tomy) a plush toy that speaks, lights up and wiggles its ears. At position 20 are the soon-to-be-released Nintendo video games Pokémon Sun and Pokémon Moon.

If predictors of retail trends are right, 2016 holiday sales are in for a big boost, thanks to Nintendo’s crew of irresistible pocket monsters.

Re-inventing Retail: It’s Not Just for the Big Guys

Re-inventing Retail: It’s Not Just for the Big Guys
Smaller Stores are Joining the Latest Retail Real Estate Trend
By Melissa Sievwright – VP, Marketing

In a previous post we shared some of the latest developments in the re-invention of retail – a chapter of our industry’s history that is being written right now. But in case you thought only businesses with mega budgets, like Reebok and Target, could be re-inventors, think again. Independents and small chains are that ready to get creative can transform retail, too. Many of the tenants in the shopping centers managed by Levin are starting to explore the possibilities. Here’s a quick look at some of the winning tactics in this growing retail real estate trend.

Going Hyperlocal Drives Shopper Traffic and Customer Loyalty
The connection between small businesses and their communities is a powerful one, and something that cannot be duplicated online. People are interested in what’s going on locally and prize locally sourced products. Retailers who want to stand out are tapping into this interest and partnering with their closest “neighbors” to bring shoppers into their stores for events and special promotions.

The Seven Most Popular Recipes for Small Store Re-invention
Keeping the hyperlocal connection in mind, re-inventors with small budgets are turning their stores into destinations. The most popular templates are proving to be:

1. Samplings, with food and beverages from local sources.
2. Art shows, with displays by local artists and crafts people.
3. After-hours shopping, with special openings for VIP customers.
4. Product demonstrations.
5. Holiday tie-ins (not just in December), with a special day in every month.
6. Classes, featuring everything from crafts to accessorizing.
7. Charity, with events that benefit organizations (the more local the better).

Successful Re-inventors Look Beyond Their Core Business
Whether a retailer is large or small, they must provide a compelling and relevant customer experience (“shopper-tainment”) if they want to re-invent. That means thinking of themselves as more than a supplier of goods or services. The big players provide great examples. Staples is a source of business support, not just a place to buy supplies. Reebok is not just about gym clothes, it is about a lifestyle. Following these models, a wine store becomes a source for entertainment ideas. A hair salon becomes a place for relaxation and “me time.” The wine store offers samplings from local caterers on Friday evenings. The nail salon has a free mini-massage day. This is re-invention at its best.

Social Media Powers Small Retail Re-invention
Not surprisingly, social platforms are proving to be the retail re-inventor’s best friend. They are being used to announce in-store experiences and for post-event coverage. Instagram and Pinterest, since they are so visual, are popular choices. Live broadcasts from events on Facebook’s Livestream and Twitter’s Periscope are trending as well.

These are exciting times for the retail industry. The big players are breaking the boundaries. But there also is a lot of creative action with a hyperlocal flavor at the grassroots level.

For more about re-inventing retail and smaller businesses, check out:
http://www.snapretail.com/blog/be-the-host-with-the-most-and-stay-under-budget/

http://www.retaildoc.com/blog/attracting-customers-to-experience-the-store-is-only-half-of-retail-success

http://www.nynow.com/industry-insights/how-to-create-amazing-in-store-events

Levin Retail Sentiment Survey Reflects Positive Outlook on 2016

Lower Gas Prices, Job Growth, and the Housing Market Will Bolster Sales this Year

Store managers in our 95-property, 13 million-square-foot portfolio told us they feel good about the year ahead during our annual January Retail Sentiment Survey. This is particularly good news considering that the poll was conducted at the outset of the current stock market volatility.

In fact, an impressive 68.1 percent of the survey respondents said they are optimistic about 2016. “We really are at a transitional time for retail, with factors like positive job growth, low gas pricing and the housing market uptick working in the industry’s favor,” noted Levin President Matthew K. Harding.

Mixed with the good news was some uncertainty about the specifics of 2016’s performance, with 20.5 percent of participants undecided about what exactly to expect. “The unseasonably warm fall and early winter, and what has become a longer –and therefore more diluted – holiday shopping season impacted sales for some retailers,” Harding said. “As such, it makes sense that our tenants are expressing some remaining uncertainty.”

Our survey mirrors leading industry sources, who are also predicting a respectable 2016 performance. Kiplinger anticipates retail will grow approximately 4 percent. Trading Economics expects 3.6 percent growth.

2015 Sales Showed Modest Upward Momentum Nationally

The U.S. Department of Commerce announced in January that 2015 retail sales were up only 2.1 from 2014 (for context, 2014 sales were up 3.9 percent over 2013). And the National Retail Federation reported moderate 2015 holiday season sales growth of 3.0 percent, down from its forecasted growth of 3.7 percent. Our survey, as well, showed modest momentum in both year-over-year and holiday sales.

Nearly 53.0 percent of survey respondents reported 2015 sales at the same level or higher than 2014. This figure is up from 51.7 percent and 49.4 percent reporting same/higher sales in our January 2015 and 2014 polls, respectively.

The majority of our respondents also reported a generally positive 2015 holiday shopping season, with 58.0 percent reporting sales at the same level or higher than 2014. And 57.0 percent reported that shopper traffic at the same or higher level than in the 2014 holiday season. While these figures are slightly lower than last year’s poll (63.6 percent reported same/higher sales; 60.0 percent reported same/higher traffic), they still outpace the prior year (50.6 percent reported same/higher sales; 48.2 reported same/higher traffic).

A Retail Real Estate Trend: Online and Bricks-and-Mortar Converging

Our survey and other industry reports, like RetailNext’s Retail Performance Pulse, reflected the strength of bricks-and-mortar retail during the holidays. In fact, the International Council of Shopping Centers’ Holiday Consumer Purchasing Trends Study revealed that 91 percent of consumers shopped in physical stores during the 2015 season. ICSC also reported that 32 percent of shoppers made purchases online and picked them up in physical stores; 76 percent bought additional items in the same or an adjacent store.

“We are witnessing a growing synergy between in-store and online purchasing, and its benefits for bricks-and-mortar,” Harding pointed out. “Increasing demand for this type of technology-driven, omni-channel retailing will play a big role in 2016. Bricks-and-mortar and online are converging. And it appears our tenants are gearing up accordingly.”

Looking Forward: More Than a Retail Trend, Tech is Driving Results

More than half (50.9 percent) of our survey respondents plan to add or enhance their tech-based marketing efforts in 2016 with mobile apps, social media, email and text messaging.

Approximately half indicated their company has changed its business model in response to the growth of e-commerce. The most popular adaptations include enhanced in-store services and incentives, added in-store pickup and returns option for online purchases, and generally increased collaboration between online and bricks-and-mortar. Among the retailers that have revised their business models, 40.6 percent reported a positive impact on sales.

Crystal Ball Time: What will 2016 Hold for Retail? New Stores and Right-Sizing

What’s ahead? “It remains to be seen whether the recent stock market shake-up will have a long-term impact,” Harding concluded. “We all hope to see a fairly rapid correction. Should that take place, the retail industry is likely to maintain growth momentum well into 2016.”

In some cases, this means new stores – good news for retail real estate companies like ours. More than one quarter (28.4 percent) of the store managers in our survey indicated their company planned additional locations this year. “We anticipate that smaller footprints will be the norm as retailers continue to right-size and make shifts to incorporate e-commerce into their operations,” Harding noted.

We also asked retailers if they observed shifts in the hiring climate as the unemployment rate continues falling. Their feedback indicates about 44.0 percent are noticing changes, most prominently in the areas of applications by fewer qualified job candidates and increased demand for higher starting salaries.

“U.S. unemployment inched down to 5.0 percent last month, and if this trend continues it will likely have a growing impact on retail hiring,” Harding pointed out. “This is an area we will be focusing on more closely in upcoming surveys.”

Levin’s next Retail Sentiment Survey will be conducted in June, reporting mid-year progress and exploring technology issues.

A Facelift Can Put Bricks And Mortars Ahead of The Game

Retailers May Be Neglecting Their Strongest Competitive Advantage

Digital technology has transformed our industry – some might say disrupted it – along with just about everything else in contemporary life. Retailers, over the last few years, have risen to the challenge of their online competitors with major investments in omnichannel. But have all those dollars poured into online come at the expense of the retailer’s biggest asset: the bricks-and-mortar store? This provocative question was recently raised by Antony Karabus, CEO of Hilco Retail Consulting, in a recent article in Women’s Wear Daily. He gave us cause for some thought.

Investing in Bricks: Is a Retail Real Estate Trend Emerging?

Karabus maintains that bricks-and-mortar retailers “consistently underestimate the enormous advantage they have relative to their ecommerce counterparts, in particular their physical brand assets.” A bricks-and-mortar store, he goes on to say, satisfies the consumer’s innate desire to interact with merchandise in an inviting environment. Yet, according to a survey of the CEOs and CFOs of top retailers conducted by Hilco, only 20 percent are investing capital in their stores. Forty percent of the stores in Hilco’s study, in fact, had not been remodeled in a decade.

The vast majority of retail sales still occur in stores rather than online. The most recent statistics from the U.S. Commerce Department show online sales accounting for 6.8 percent of total third-quarter retail sales. Online is growing at a steady pace, but Forrester Research projects that by 2018, it will still represent only 11 percent of total annual sales. Still, leading retailers remain fixated on tech – perhaps at the expense of their physical brand, which is the chief driver of revenue.

An Experience Technology Can’t Match…Yet

Steve Barr, U.S. Retail and Consumer Leader at PricewaterhouseCoopers, echoes Karabus’ views on the overlooked value of bricks. “There are reasons people are still going to the store – it’s accessible, people can see and feel the product, try on merchandise, see what a room set looks like. It’s a very visual experience that can’t be replicated through even the best online tools,” he told Retail Dive earlier this year. He added this caveat: “Retailers are going to need to adapt the physical store to stay relevant and compete with online retailers.”

Levin’s President Matthew Harding agrees that while a strong online presence is vital, retailers can’t afford to ignore their physical stores. “As a leading retail real estate company, we’re naturally concerned about the physical appearances of the tenants in the centers we manage. The look of a store is a valid concern for any retailer. Many of ours are doing an outstanding job. A good example is ShopRite. They’ve created high-quality environments for grocery buyers. Pier 1 Imports is another good example. I’ve seen some great interior and exterior remodeling of their stores. They’re driving more traffic because of their fresh, new look. Shoppers are drawn to novelty.”

Retailers Who Find the Right Balance Will Own the Future

Bricks and clicks need to be brought into balance, according to Karabus, who insists that success will come from serving customers “consistently at all touch points (online and in-store) however and whenever they want to interact with a retailer.” Bring stores up to meet the expectation of today’s savvy consumers, he urges. Merchants who do so will reap dividends. “The prize,” he predicts, “will be huge when retailers find the right balance of capital spending.”

U.S. Consumer Sentiment Bodes Well For Holiday Sales

NRF Projects Rise of 3.7 Percent over 2014; All Eyes on Black Friday

According to a recent NPD Group survey of 3,600 adults, U.S. shoppers are looking forward to the winter holidays this year. Eager to catch a break from “what’s going in the world” and wanting “to give to the less fortunate” are the main reasons given for the positive sentiments. Whatever’s behind their holiday outlook, 15 percent of those surveyed plan to spend more than last year and 16 percent plan to spend less (down from 20 percent in 2014). That’s the smallest gap between the two groups in the last three years. The glass looks half full as we head into the make-or-break season, and as a leader in retail real estate, we’re watching for the opening salvo – Black Friday – and what it might indicate for the final stretch of 2015.

Modest Rise in Holiday Sales Projected by Major Retail Trend Watchers

After a sluggish 2015, will retailers get a rush of spending in the year’s closing weeks? The National Retail Federation has projected an increase of 3.7 percent, totaling $630.7 billion in sales for November and December and slightly below last year’s 4 percent advance. Deloitte LLP is more optimistic, predicting an upward tick of “as much as” 4 percent. Alix Partners’ view is more sober at 2.8 to 3.4 percent. Whichever number eventually materializes, it seems that the retail trend toward bargain-hunting will continue, with buyers as the ultimate winners.

“Americans remain torn between their desire and their ability to spend. The fact remains that consumers still have the weight of the economy on their minds,” said NRF President Matthew Shay. Despite low energy prices and a strengthening job market, the economy is not in full recovery and not all boats have been lifted by the rising tide. Stagnant hourly wages at the lower end of the economic spectrum have restrained a substantial segment of consumers.

PwC describes today’s shoppers as divided into two groups: “survivalists” and “selectionists.” The border between the two is a household income of $50,000. Those below that mark will seek bargains this holiday season, planning to spend $631 less than last year. Those above, who are planning to boost seasonal spending by $1,331, will gravitate toward personal electronics and experiences (travel and entertainment). But, because of the power of the Internet, shoppers in both groups will be able to search for and find the best deals for almost everything on their wish lists, using dozens of websites with up-to-the-minute news on Black Friday specials.

Once a Retail Trend, Now a Retail Institution, Will Black Friday Bounce Back from 2014s Fall-off?

The winter holidays are a crucial season for many retailers, with the major chains dependent on November and December activity for as much as 30 percent of their annual sales. Black Friday, the unofficial opener to the season, holds special significance. A consistent winner for the past dozen years, Black Friday’s sales fell off 11 percent in 2014, with four-day total sales of $50.9 billion, down from $57.4 billion in 2013. This includes both in-store and online.

Amazon Will Open the Season on November 1, But Wal-Mart Will Finish on Top

No retailers are waiting for the day after Thanksgiving to launch holiday promotions. First out of the gate on November 1 will be Amazon with its “Countdown to Black Friday” promotion. From there, the frenzy will continue, peaking on Black Friday but continuing through the holiday weekend before slipping into online’s own Cyber Monday.

If Black Friday itself turns in a disappointing performance, trend watchers say, it will likely be the result of a time frame that has stretched from one day to two to now a full month. BestBlackFriday.com, a website that tracks seasonal retail activity, predicts that Friday sales will slip 3.3 percent to $8 billion. Thanksgiving Day will get a bump of 18.8 percent. Together, the two days will see online sales up 33.3 percent from 2014.

As Black Friday 2015 becomes retail history, promotion will continue to surge from Cyber Monday to Green Monday (the second Monday in December), all the way to the final holiday shopping week, when in-store sales are expected to spike. At the season’s end, retail watchers predict, Wal-Mart will emerge the big winner. Its multi-channel strategy includes their one-hour in-stock guarantee policy, online exclusives on a powerful website, and irresistible in-store pricing on the hottest holiday items.

Interested in more trends and predictions for Black Friday, visit: http://www.twice.com/news/statistics/top-10-black-friday-2015-predictions/58759.

Retail Real Estate Trends: In-Store Restaurants and Hip Hybrids are On the Rise

High-End Cuisine and Artisanal Coffee Draw Customers, Boost Sales

The grand department stores of yesteryear – Marshall Field’s, Hudson’s, Wanamaker’s and others – always featured a “tea room” where elegant ladies could enjoy refreshments during shopping sprees. Over the decades, in-store food service has changed, along with shopping styles, but it’s never gone away. Today, Starbucks keeps Target shoppers caffeinated, McDonalds fortifies bargain-hunters at Wal-Mart and Ikea continues to serve up Swedish meatballs and other Nordic favorites. At the higher end of the shopping spectrum, Nordstrom operates multiple restaurants throughout its chain, boasting a total of seven different food service concepts and 200 eateries and coffee bars in its properties. Still, new food-related retail real estate trends keep emerging –and they’re definitely not your grandmother’s tea room.

Department Stores, Branded Shops Build Traffic with Quality Food and Drink

When Fodor’s, the venerable publisher of travel information, starts listing the 10 best in-store restaurants, it’s a sign that store-based dining has reached both a critical mass and a quality high-point. On the retail real estate NYC scene, big name chefs like David Burke preside at Bloomingdale’s. Hip restaurant brand Momofoku Milk Bar operates out of Soho’s Band of Outsiders boutique – right in the front window. Lord & Taylor shoppers can take a break at branches of Sarabeth’s. Ralph Lauren recently joined in with a main level coffee bar (featuring Lauren’s own brand of beans) and a full-service restaurant upstairs at its Fifth Avenue flagship. Among the latest to join the in-store food trend is Urban Outfitters, who opened a three-floor venue on Herald Square in June –the largest in their 400-store chain. A main floor feature is an outpost of Intelligentsia Coffee of Chicago, “designed to serve an ocean of coffee to thousands of passers-by each day.”

At Tommy Bahama’s “Lifestyle” Stores Food and Drink Reinforce the Brand

A brand-oriented take on the in-store food service trend in retail real estate is Tommy Bahama’s Island concept. The resort-themed menswear company has launched 13 “Island” stores, where shoppers find an immersive environment that includes tropical cocktails and menus, a perfect backdrop to the brand’s beach-y fashions and accessories. Tommy Bahama reports that its “Island” stores, located in such venues as The Woodlands Mall in Dallas, Corona del Mar Plaza in Newport Beach, and Scottsdale’s Kierlands Commons, generate two and a half times the sales per square foot as their other 97 locations.

At Hip Hybrids, Store and Restaurant Merge for a Single Customer Experience

Saturday’s Surf may have launched the hybrid trend in NYC retail real estate. The five-year-old Soho-based boutique (now with three additional locations) offers surfboards, accessories and a full line of surf-inspired menswear. Its artisanal coffee bar is integrated into the selling floor. Co-founder Josh Rosen, who is expanding into new markets, insists that coffee is so essential to his business that any new leases must permit beverage service. Management at Shinola, a Detroit-based merchandiser of watches, bikes and accessories with shops in NOHO and Tribeca, second Rosen’s sentiment. “Sights, sounds, and smells of a café bring a no-fuss feeling to a luxury goods store,” they said in a recent statement.

Custom-brewed coffee, along with craft beers, is fueling the success of lifestyle retailers on the West Coast, who, like Saturday’s Surf and Shinola, merge merchandise and refreshments in a single space. In Portland, Velo Cult, which purveys bikes and all things bike-related, relies on the “nerdiest black coffee around” and a menu of local beers, along with live music and film screenings, to pack their “man cave” venue. Seattle-based Chrome Industries, designer and manufacturer of bike-related clothing, footwear, bags and accessories, has six “HUBS” or stores in San Francisco, Seattle, Portland, Chicago and recently New York City. San Francisco’s famed Blue Bottle Coffee is the go-to beverage and like Velo Cult, music and screenings are key parts of the mix.

What’s this latest in-store eating and drinking trend all about? Beyond attracting and satisfying the customer, there’s doubtlessly the recognition that in-store amenities like high-quality coffee and unique menu options enhance the shopping experience beyond just browsing and buying. Shopping centers with a rich tenant mix have picked up on this retail real estate trend, just as urban stores and boutiques have. Here’s a powerful competitive edge that online can’t match.

Outlook on Holiday Retail Sales is Optimistic

But Analysts Present a Mixed Picture of How Robust the Increase Will Be

After a tepid back-to-school season and with Black Friday just weeks away, all eyes in retail, including retail real estate, are fixed on analysts’ predictions for 2014 holiday spending. The majority of the announcements are cause for good cheer, with major forecasts from such sources as the bellwether National Retail Federation (NRF), pointing to healthy increases over the 2013 season. The question seems to be not whether there will be a spike in sales, but how much of a rise we can expect.

In General, a Bright but Mixed Picture of Crucial Retail Holiday Season

The National Retail Federation predicts that 2014 holiday sales will increase 4.1 percent for a total of $616.9 billion. That’s a full percentage point ahead of 2013’s gain and well above the ten-year average annual rise of 2.9 percent. Jack Kleinhenz, the trade organization’s chief economist, cites increases in employment, disposable income and the number of shopping days in this year’s calendar among the contributing factors. But don’t pop the champagne corks prematurely. The Wall Street Journal observed that the NRF’s forecasts have failed to match actual sales for the past six years. Other major retail analysts, however, mirror the NRF’s outlook for the upcoming season.

In September, Deloitte predicted a rise of 4 to 4.5 percent in holiday sales, which would be the biggest increase in at least three years. Alison Paul, Deloitte’s vice chairman and retail distribution section leader, said in a widely quoted interview that there is “a psychological glow of people generally feeling better about the economy” as a result of increased employment and rising personal income.

AlixPartners delivered an even more optimistic vision of the holiday ahead, predicting an increase in sales of as much as 4.9 percent. Like Deloitte and the NRF, they cited the improving economy, including falling gas prices and unemployment rates, as the reasons why shoppers can be expected to open their wallets wider this year.

Prosper Spending Score, based on their recent consumer survey, sees an 8 percent leap from 2013’s levels. The engine driving their outlook is feedback from upper-income households ($75,000+ per year) who maintain a spending score that is 13.2 percent higher than the overall average. Of interest to the retail real estate market is Prosper Spending Score’s predictions about the performance of individual retailers. According to their consumer research on 150 retailers, Gap, Amazon, Macy’s and Nordstrom are among those expected to be top holiday performers.

PricewaterhouseCoopers Says Cash-Strapped Consumers Point to Sales Drop

The sole dissenter among the major analysts is PricewaterhouseCoopers, who has predicted that average household holiday spending will drop by 6.9 percent from last year’s levels for an average outlay of $684 in 2014. Their projection is based on a poll of 2,200 U.S. consumers, who, in spite of a stable level of inflation, cited concerns over rising costs in food, transportation, housing and health care as motivators to cut their holiday spending. “The consumer doesn’t believe the economy has necessarily improved,” said Thom Blischok, chief retail strategist of PwC’s Strategy& unit (formerly Booz & Co).

There’s Agreement on One Thing: Online Looks Bigger Than Ever

The forecasters seem to be of a single mind about one thing for the 2014 holiday season: online will continue to be the star performer. Deloitte projects a spike of as much as 14 percent in online and mail-order sales, while Shop.org predicts an increase of between 8 and 11 percent. That’s good news not only for online retailers but for shipping companies like UPS, who is expecting to hire as many as 95,000 temporary employees. Total seasonal retail hiring is anticipated to range from 725,000 to 800,000.

But online shopping isn’t the only role electronic devices will play. Digital interactions will influence 50 percent of in-store sales as savvy shoppers research products and compare prices via their computers and mobile devices. Retailers are responding by optimizing their websites for mobile platforms and supplying their sales associates with tablets for in-store customer support.

Gift cards will continue to be top sellers and the most popular gift category will be electronics. Apparel sales may lag except among those retailers with a trendy inventory supported by a strong web presence.

Despite Solid Outlook, NRF Advises Retailers to be Cautious

The most wonderful time of the year may be about to arrive, but retailers are still advised to be aware of consumers’ continued price sensitivity. “Recognizing the need to keep household budgets in line, we expect shoppers will be extremely price sensitive as they have been for quite some time,” said NRF President and CEO Matthew Shay. “The lagging economy, though improving, is still top of mind for many Americans.” He advises retailers to respond by “differentiating themselves and touting price, value and exclusivity.” Promotions, though perhaps not as prevalent or as deep as last year, will continue to play a role.

What do Retailers Think About Holiday 2014? Levin Survey Looks for Answers

Levin Management is one of the retail real estate companies that conducts regular surveys of tenants in their shopping centers. Our annual Pre-Holiday Retail Sentiment Survey is currently in progress and we expect to release the feedback in mid-November. Key findings will be published here.

Halloween Stores are the Tip of the Pop-Up Iceberg

Short-Term Leases Have Gone Beyond a Retail Real Estate Trend

It’s an established cycle. Halloween stores brimming with costumes, decorations and accessories spring up like pumpkin patches around Labor Day and then, as the winter holiday shopping season rolls in, they vanish from the mall or shopping center (to be replaced perhaps by a temporary crafts boutique, a toy store or a marketer of calendars). Second only to Christmas as America’s favorite holiday, Halloween is a potent driver of retail sales. According to projections of the National Retail Federation, 2014’s Halloween shopper will spend an average of $77.52 and total spending will reach $7.4 billion, up from $6.9 billion last year. Behind that upward spike is a strengthening economy and the fact that October 31 falls on a Friday, giving Halloween revelers a full weekend to celebrate.

Levin Management’s temporary tenants – Halloween City in Paramus Place and Clifton Plaza and Masquerade at Brunswick Shopping Center – are in holiday sales mode. Like all tenants that are leasing a retail space on a short-term basis, these popular, heavily promoted specialty stores boost traffic and sales for the entire shopping center in which they are located. And although Halloween stores, which have grown in numbers by 30 percent over the last four years, are the heavyweights of holiday pop-ups, Christmas, Valentine’s Day and Fourth of July stores are gaining in popularity.

A Retail Real Estate Trend No More: Pop-Ups are Here to Stay

Now a well-established part of the U.S. retail scene, pop-ups began life in the early 90s in densely populated urban centers like New York, Tokyo, London and Los Angeles, providing emerging brands the opportunity to access consumers in high-rent retail zones for a limited period, usually less than three months. The concept proved a retail real estate win-win for budget-conscious renters and property owners with vacancies to fill.

By the end of the decade, big players began to realize the value of leasing a retail space short-term – for market testing, promotions and new product introductions, as well as for moving merchandise, offering seasonal goods and services, or penetrating specific geographic areas. Target, with 1,000-plus stores in the U.S., leased a 1,500-square foot pop-up in Rockefeller Center to launch its Isaac Mizrahi line in 2002. Toys “R” Us set the pace in 2010, supplementing its 800-plus stores and its e-commerce sites by leasing 600 pop-ups across the U.S. during the Christmas season. Since that time, such diverse companies as HBO, eBay, United Healthcare, Song Airlines, H&R Block and even Microsoft have taken the pop-up route into targeted markets.

Online Giants Choose Pop-Ups to Test Brick and Mortar Retailing, Reach New Markets

Following the lead of fellow online retail pioneer eBay, the mighty Amazon announced it will enter the world of U.S. pop-ups on October 22, with the opening of a store in the Westfield San Francisco Center. Amazon had previously leased a pop-up in China. The new store will offer Amazon’s latest branded electronic products, including FireTV, Fire Phone, Fire Tablets and the most recent version of the Kindle e-reader. The company has leased a Midtown Manhattan space as well, which is scheduled to open shortly.

Demand for Pop-Ups Generates a New Retail Estate Trend  

Meet Storefront. Its twenty-something co-founder Tristan Pollock calls it “the Airbnb of retail,” and it is transforming the business of short-term commercial retail leasing. Through its website, TheStorefront.com, it connects owners of vacant space in San Francisco, Los Angeles, Chicago and New York, to individuals and companies shopping for pop-ups. Venues range from booth space at festivals and in transit stations to nooks in hotels or galleries to storefronts in high-end neighborhoods like New York’s Soho. Daily rates run from a few hundred dollars to upwards of $5,000. Tenants who have connected with properties through Storefront include online fashion retailers Indochino, Hatch, and Storenvy and artists like Kanye West, who marketed promotional merchandise from his Yeezus tour in a branded shop (daily rent $1,550) on New York’s Bowery. Unlike a booth at a concert venue, the shop, which was opened for the four days of the New York concerts, attracted media coverage and a stream of celebrity shoppers.

For its matching services, Storefront collects commissions in the 6-12 percent range, which includes general liability insurance. David Bell, professor of marketing at The Wharton School of the University of Pennsylvania, told The New York Times that Storefront is “like Airbnb, eBay and Uber rolled into one. It matches excess capacity with demand in an efficient, scalable way.” And that sounds like a retail real estate trend in the making.