Retail is Busy Reinventing Itself

Although a superficial view of retail in the year of COVID-19 would suggest a bifurcation between “essential” categories that performed relatively well and non-essential operators that filed for bankruptcy, the reality is both more nuanced and more positive, says Phillips Edison & Company (PECO).

“The notion that retail is dead is misinformed,” said Mike Conway, VP of national accounts & retailer partnerships at the Cincinnati-based REIT. “Rather, the industry is rising to the challenge and embracing change at a pace we’ve never before seen. It’s about meeting customers where they are, eliminating friction and creating custom experiences that consumers value.”

PECO’s Emerging Trends team has identified the following as the most interesting themes heading into 2021:

• Ghost Kitchens – In addition to the rise in restaurants of all sizes leveraging ordering apps to accommodate social distancing and differentiated consumer preferences during the pandemic, there’s been an increase in national brands utilizing ghost kitchens to provide takeout and delivery service without opening a storefront. Moreover, DoorDash has gotten in on the ghost kitchen trend with the introduction of DoorDash Kitchens.
• The Rise of the “Groceraunt” – As convenience and experience remain top priorities for consumers, grocers and dine-in restaurant operators are pairing up to create more diversified offerings within grocery environments.
• Delivery by Drone –Although the use of drones to deliver goods to consumers has been talked about for years, it has become over the last 18 months. The adoption of drone delivery among retailers has taken off at a faster rate during the pandemic, with Walmart taking the lead.
• The 5G Experience –As 5G networks and devices proliferate, retailers will have even more options to create the interactions and experiences that customers crave through tools such as virtual and augmented reality. It also allows retailers to collect even more data for greater personalization.
•Discount Growth – Despite the impact of COVID-19 on the economy, certain brands have continued to advance growth plans undeterred. This is particularly notable among quick-service and fast-food restaurants, including Popeyes, Chipotle and Dunkin’. Moreover, a number of retailers that offer elevated discount shopping experiences – including Five Below and Dollar Tree – have continued to expand across the country.

Ashley Casey, PECO’s director of national accounts, West, said, “The industry continues to evolve, and while change is never easy or smooth, forward-thinking retailers will always find a way to stay relevant by meeting their customers where they are and catering to their preferences. We are fortunate to have many of these types of retailers in our portfolio.”

For comments, questions or concerns, please contact Paul Bubny