Tuesday, June 2, 2009

Here's What 1,200 Shoppers Say Needs to Improve along Urban Commercial Corridors

Unfortunately, there is scant professional research and literature in our field – but there are some recent studies lately that are beginning to change this. A firm called Market Knowledge recently published a fantastic analysis of urban neighborhood shopping patters. The study “Urban Neighborhood Shopper Satisfaction Analysis” is a summary of 1,200 shopper surveys distributed in five urban neighborhoods (4 in Philadelphia, 1 in New York). The entire report can be downloaded at: http://www.eightpoints.com/research/customersatisfactionreport.pdf

Here are some highlights from the study, sprinkled with my own observations and insight, that confirm what many practitioners already know…

1. What happens “inside the store” matters. 70% of the customer experience is defined by what happens inside the store. Customers care about the quality of merchandise and the service they receive – and if they don’t find what they want in your district, they may never come back. Unfortunately, this means that much of the revitalization effort happens in the private realm – in the attitude of business owners as they greet customers, in the quality of their merchandise and in the attractiveness of their merchandise displays. Addressing these ‘inside-the-store’ issues is a tremendous challenge for commercial district managers. This is why a successful revitalization effort cannot happen without the cooperation and engagement of local merchants. For those commercial district entities interested in tackling this issue – one creative approach is a ‘Retail Audit’ that can help individual merchants diagnose and address problems and issues that may be keeping customers away. See a recent blog post on ’Retail Audits’ for more information.

2. Regardless of gender, income or age, the quality of the shopping environment (read – clean and safe!) makes a big difference to shoppers. At least initially, these clean and safe improvements need not be capital intensive – but they must be visible and they must make a marked improvement in the retail environment. Regular street sweeping, garbage pick-up, graffiti-removal/murals, etc. can make a difference – not just in how clean the district is, but also how safe it feels. The perception of crime is often more palpable than the reality of crime in many urban districts – and taking care of housekeeping can make a big dent in how the area is perceived. It sometimes make me nervous to emphasize the physical environment – only because many commercial district entities focus almost exclusively on making improvements to the physical environment and the public realm and then avoid addressing issues like store quality, store mix, value and convenience in their revitalization efforts. It’s important to note that a successful revitalization effort, particularly in an urban area, needs make sure they are addressing issues of clean and safe at the

3. Use the early stages of your commercial district management effort to lay the foundation for successful businesses – both new and old. Often times, communities are so excited about commercial revitalization that one of the first things they want to do is attract new retail to the district. But they jump the gun by going after retail before they are “retail ready.” Setting the stage for new retail means making sure the district is ready to accept new businesses – again, read clean and safe, and that the environment is conducive to attracting and retaining customers over time.

4. Parking and traffic congestion are not necessarily the most important issues to customers – even though in our experience merchants typically think this issue trumps all others. I have come to the conclusion that often times, complaints about parking are merely a scapegoat for merchants to avoid some hard truths – that the businesses are not offering the right mix of goods and services to customers and that marketing and communication in partnership with other businesses is lacking.

Any district management entity making a decision about 'first steps' in their revitalization effort should give this report a good read....

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