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Focus on: Del Mar Highlands Town Center

BY By Katherine Field Boccaccio

When Donahue Schriber made the decision to renovate its Del Mar Highlands asset two years ago, the objective was far different than the customary shopping center rehab. 


The 20-year-old Carmel Valley property was already the flagship of the Costa Mesa, Calif.-based developer’s portfolio, so the renovation wouldn’t be about fixing something that was broken, but rather improving an already successful center.


Changes in the area, such as a residential population that exploded over the 20-year span, average annual household income of $160,000, and 4.4 million sq. ft. of office space that sprang up within one mile of the shopping center, led Donahue Schriber to carefully consider how Del Mar Highlands could better leverage its setting.


“When you look at the evolution of the area, you can see the gaps that created opportunity for us,” said Elizabeth Schreiber, VP and general manager, Donahue Schriber. “We had a gem in the shopping > center but asked ourselves what we could do to make it stronger and better.”


Enter what the team calls the re-imagination of Del Mar Highlands. More than a renovation, the project became a re-imagining of what the center could be. In 2009, Donahue Schriber conducted intercept surveys, asking customers what they liked about the shopping center and what they didn’t. The responses led the developer to make several key changes.


Customers wanted better parking and traffic flow, so Donahue Schriber hired a civil engineer to find every inch of potential parking space. “By cutting into a planter by a foot and by adding retaining walls in the hill sides, for example, we were able to add 76 parking stalls,” Schreiber said. Unusable compact stalls were converted to full-size slots to accommodate the SUV demographic, and traffic flow was altered to provide access to a formerly off-limits parking field.


Customers wanted more restaurant choices, and the developer responded by launching a search for the best of San Diego. It brought in the Asian cowboy-themed Burlap, created by celebrity chef Brian Malarkey, which opened this July, as well as a lineup of additional new-to-market dining options.


And, finally, Del Mar Highlands customers wanted better gathering places. Donahue Schriber converted an existing amphitheatre into a two-tiered gathering area, and added fountains and an outdoor fireplace. 


Two grocery stores anchor Del Mar Highlands Town Center — Ralphs Fresh Fare and Jimbo’s Naturally — and Donahue Schriber brought in San Diego’s first luxury theater, which opened July 22. The new, nearly $7 million Cinepolis Luxury Cinemas was plugged into the former UltraStar Cinema, representing the Mexico-based operator’s first foray into the United States. 


The theater has proven to be a huge draw for the center, as guests enjoy a full bar, VIP seating in a luxury setting, high-end food options and full concierge service.


“We turned up the volume on everything we did,” Schreiber said. “Before we launched the re-imagination, Del Mar Highlands was a successful community daily-needs shopping center, and $20 million later it is a state-of-the-art destination and the premiere shopping center in San Diego.”


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della12134 says:
Jun-24-2013 12:20 pm

William
I really love this beautiful and artistic work. Thanks a lot for posting this precious blog post.I guess looking back at it, that may be true (or at least truthy) but writing about what we have now as if it was the only thing we could have had but it just took a while is what triggered my comment. William

della12134 says:
Jun-24-2013 12:20 pm

I really love this beautiful and artistic work. Thanks a lot for posting this precious blog post.I guess looking back at it, that may be true (or at least truthy) but writing about what we have now as if it was the only thing we could have had but it just took a while is what triggered my comment. William

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N.Spotcheckbilly says:
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C.Floz says:
Nov-30-2012 11:59 am

It is particularly difficult
It is particularly difficult to improve something versus renovating it. There is a big difference of the two. A bar has been set already and improving is trying to outdo the bar set. That is the difficult part. - Arthur van der Vant

C.Floz says:
Nov-30-2012 11:59 am

It is particularly difficult to improve something versus renovating it. There is a big difference of the two. A bar has been set already and improving is trying to outdo the bar set. That is the difficult part. - Arthur van der Vant

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The Future of Technology in Retail

BY Jill Puleri

The past century has seen retailers at the forefront of adopting many powerful new technologies, which were instrumental in increasing both sales and customer satisfaction. As significant as these past innovations were, recent developments suggest that we are at the beginning of a retailing renaissance that will see a big leap forward in merchants’ ability to understand consumers’ needs. 


The innovations of the past century usually involved automating tasks as well as connecting people, businesses and institutions to each other, while also connecting data and information in much faster and more efficient ways.


For example, early adopters at the turn of the last century used tabulating machines to count faster, manage employees and serve customers better and generally understand information in new ways. Then came the bar code in the ’70s that revolutionized not only the checkout process, but also order tracking. 


Fast-forward to the age of the Internet, which changed how consumers shop and the way retailers understand, sell to and service those customers. Today consumers are armed with smartphones and now have — in the palm of their hands — the ability to research any product and make purchases wherever and whenever they want.


These changes are profound because humans innovate, learn and grow through connection, and automation frees us up for higher-order tasks. But we’re approaching the limits of what automation and connection can deliver. While they will remain critical to the advancement of retailing, a new era of analytics and understanding has already begun. 


The real power of analytics lies in better predicting what is likely to occur, and in helping decide what to do next. For example, a consumer electronics site can provide a discount for a particular brand of Blu-ray player for a customer who is purchasing an HDTV, based on the customer’s profile, past purchases, preferences and other information.


But we can do much more. Analytics can translate mountains of data into a real understanding of individual needs, the kind that is usually derived from the social interactions we have with those who know us. As we share with retailers our likes and dislikes, our hobbies and so forth, they will be able to provide a much better shopping experience. 


One glimpse into this future is Watson, the computer that defeated the two most celebrated “Jeopardy!” champions earlier this year. To win at Jeopardy! one must be able to think like a human using natural language. This is a new kind of technology, one that can analyze and discern human meaning, creating a better understanding of the customer and delivering a better shopping experience by helping sales associates answer the most difficult customer questions in real time. For example, “What is the next contact we should make with this customer? When should we reach out to him? What should we say? And through what medium?” 


And for the consumer, imagine a day when you could ask — in natural language — “What gift should I buy a techno-savvy 9-year-old boy?” And the response comes back with the top suggestions and what stores have them in stock. Gift giving just got smarter, thanks to customer analytics and a bit of technology wizardry. 


The profound changes underway now will affect the way we make personal decisions and how companies make strategic and tactical ones. In retailing, the combination of analysis with understanding — and with connection and automation — will provide merchants with the best opportunity in many decades to forge deep and lasting bonds with their consumers. 


Jill Puleri is VP and Global Retail Industry Leader, IBM Global Business Services. IBM is celebrating its Centennial Anniversary this year.

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Limited Edition Retail

BY Connie Robbins Gentry

There is no escaping the pop-up or temporary store phenomena — and with retail vacancy still high in some markets, it’s not likely to go away anytime soon. What’s more, consumers seem to love them. 


While a few critics are grumbling that the proliferation of pop-ups has taken away from their impact, they are in the minority. Most experts agree that, as a retail platform, the temporary format has real staying power. 


“I don’t believe that pop-up stores have run their course — on the contrary, I think they’re in their infancy. Pop-ups offer great opportunity for innovation and will continue to progress and become a regular part of a brand’s format options,” said Scott Jeffrey, chief creative officer, Interbrand Design Forum, Dayton, Ohio.


There is a great deal of variation within the temporary-store space. Some pop-ups exist mostly to generate brand buzz (Target has mastered this strategy) and connect with customers, others to test new markets or new products. Pop-ups with extremely limited life spans are typically birthed and executed by the retailer’s marketing department. 


“Pop-up stores [of this type] tend to respond to a marketing need or product launch; the primary objective is to create market awareness and build the brand. In many ways, pop-ups are 3-D marketing,” said Ken Nisch, chairman, JGA, Southfield, Mich. 


Conversely, pop-ups of the seasonal variety, such as a Halloween store, are more about the merchandise and the moment. Such stores are created primarily to sell product and maximize holiday sales. They also allow retailers to test new formats or locations. 


The lines blur, however, when seasonal retail embraces the speed and marketing panache of the more dramatic, event-oriented pop-up concept. In fact, many retailers define their stores as both seasonal and pop-up. 


Burlington Coat Factory, Burlington, N.J., fits into this category, with the 20 “seasonal pop-up coat stores” that it opened in 12 states last year. The stores, branded Burlington Coat Factory Select, ranged from 5,000 sq. ft. to 10,000 sq. ft. with assortment limited to coats and outerwear, opened in early to mid-November and closed at the end of the winter season. The company plans to repeat the pop-ups this season, but has not announced specific locations. 


Toys “R” Us also has a recurring seasonal pop-up concept. The chain opened approximately 90 Toys “R” Us Express stores for the 2009 holiday season and 600 Express stores in 2010 in malls, outlet centers, street locations, strip centers and outdoor lifestyle centers nationwide. Toys “R” Us uses the seasonal platform to test different real estate formats.


“We were particularly pleased with the foot traffic at our Express stores in outlet centers [during the 2010 holiday season] and determined they presented a viable year-round business opportunity for the company,” said Katie Reczek, spokeswoman, Toys “R” Us, Wayne, N.J. “We have opened 12 [permanent] Toys “R” Us Outlet stores nationwide, with additional locations scheduled to open later this year.” 


Weighing in sales performance, space availability and other factors, the Express stores also give the company a good indication of whether a more permanent location is warranted. Of the 600 holiday stores Toys “R” Us opened in 2010, 68 have remained open. 


Real estate rules: Location always matters, but the real estate strategy for a pop-up store is quite different than for a seasonal store — the latter concept is typically governed by opportunistic real estate decisions dictated by availability and lowest cost. Pop-ups, on the other hand, tend to go for high-profile settings. 


“You won’t see pop-ups in second-tier real estate, only in prime locations that generate maximum traffic,” Nisch said. 


Christina Norsig, CEO of PopUpInsider, an online exchange that connects retailers with landlords seeking to lease space on a short-term basis, is both a pop-up consultant and retailer. Each year, as the founder and CEO of eTableTop, an online seller of decorative accessories, Norsig searches out vacant spaces in Manhattan to turn into holiday pop-up showcases for her brand. For Norsig, the right real estate positioning has enabled eTableTop to better connect with its customers. (Norsig is the author of the recently published “PopUp Retail: How You Can Master this Global Marketing Phenomenon.”) 


The list of those who want to open a pop-up store run the gamut from exclusive European manufacturers to mom-and-pop entrepreneurs. But Norsig added a cautionary note.


“The best candidates to open a successful pop-up store are experienced retailers who know how to run a business,” she said. “Just because it’s temporary, doesn’t mean it can be less professional.”


Success with pop-ups hinges on selecting the optimum site and making the most of the space. 


“The most successful pop-up stores leverage existing architecture — start with an interesting skeleton space and build on the bones to showcase your brand,” said Interbrand’s Jeffrey. “It helps to choose a space that will serve the brand and has inherent interest in and of itself.” 


Most pop-up stores rely heavily on graphics and signage, according to Jeffrey.


“You actually don’t want the space to look permanent because you want to communicate a sense of urgency,” he added. 


In terms of execution and design, a pop-up has to be able to open and close even more quickly than a seasonal store. Toys “R” Us typically spends a week opening each of its holiday Express stores and another week to close each location. 


By contrast, brand- or event-oriented pop-ups can sometimes open and close in a matter of hours, as was the case with a Smart Car pop-up. Created by Interbrand Design Firm, the entire store, which included three Smart Car coupes, traveled in a single trailer that quickly converted into a pop-up at road shows around the country. 


When it comes to investments, budgets for pop-ups are typically less restrained than for seasonal stores, which tend to focus on modularity and logistical simplicity, JGA’s Nisch said.


“Fixtures are often stored and reused the following year for seasonal stores, but pop-ups may rent theatrical lighting or media equipment because the store won’t be repeated in the same location,” he added. 


Similar to marketing or public relations campaigns, Nisch said, “pop-ups are measured in terms of cost per impression versus seasonal stores that measure costs as a percentage of sales.”


Indeed, it’s not uncommon for a pop-up to drop > $10,000 to $15,000 to finesse a tiny space for a 10-day run. 


“Everyone wants the perfect little 1,500-sq.-ft. clean vanilla box with [immaculate] walls, lighting and HVAC, but those are few and far between,” Norsig said. “Realistically, you have to consider difficult spaces in prime locations — and then think creatively.” 


Future: Looking ahead, Norsig believes pop-ups will come and go even faster than they do today — think Flash Mob translated into Flash Marketing via pop-ups that exist for mere hours.


Interbrand Design Forum’s Jeffrey envisions “great opportunities for the Amazons of the world” to open seasonal pop-up showrooms in vacant shops. Similar to Norsig’s strategy with eTableTop, online retailers might utilize pop-ups as an opportunity to connect with customers while maintaining their fundamental business model of displaying product to be ordered and shipped rather than running inventory through the store. 


JGA’s Nisch suggested that the next opportunity to leverage real estate value might be for premium malls to dedicate two or three vanilla spaces as permanent pop-up venues, leasing them for brief periods to a diverse mix of tenants that would create buzz and excitement in an ever-changing rotation of retail. 


Pop-up stores are also moving online. Flash sales site Fab.com is launching online pop-up stores with a series of themed retail “shops” inside its site. Fab is working with Fast Company on its first pop-up shop, called U.S. Design, which will showcase the work of some 76 American designers featured in Fast Company’s iPad app. 


The shop, curated by Fast Company and hosted by Fab will stay open a month and will feature about 150 items. But that’s just the beginning. Fab hopes to launch about five online pop-up stores by year-end.


Connie Robbins Gentry is a contributing editor for Chain Store Age.

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