"Signs" of the Time: How Downtown Signage Can Drive Retail Sales

Marketing experts say that it takes 7 to 12 contacts to turn a prospect into a customer. Yet in our experience, many downtown's fail to take advantage of the opportunities they have to get in front of customers - namely through signage that captures attention. Here are a few recent examples we've come across through our work that illustrate how signage can help raise awareness of both downtown and local businesses.

Business signage - or lack there of
Visible signage is an important part of a business' marketing strategy. Consider this - an exterior sign is visible 24 hours a day and 365 days a year – raising awareness of a business even when that business is closed. Yet some communities have over regulated signs - believing that fewer or smaller signs are in "good taste".

What is down there? Hard to tell, right?  The lack of visible signage limits exploration and
make distances seem much farther away than they are, keeping customers from walking down the street. 

On the other hand, "blade" or "protruding wall" signs can help orient a pedestrian by giving them important visual cues that there are businesses down a corridor.

The businesses in touristy Great Barrington, MA do a great job of
offering signs as a form of "breadcumb" that pulls pedestrians along the street in exploration of new stores. 

Signage that isn't doing it's job
A downtown cultural anchor is a great asset - but what if most people don't know it's there?

Can you spot the Marquee for the Clemens Center in downtown Elmira?
Hint, hint - it's on the right.
During the daytime, this heavily trafficked road carries more than 12,000 vehicles.
These are 12,000 daily impressions that are being neglected. 

Cultural institutions in particular benefit from highly visible signs that also offer opportunities to promote upcoming events, like this gateway marquee marking the entrance to Downtown LA.

Painted Signs on Walls
A blank wall can be a great opportunity to help connect businesses with potential customers.

Freestanding Signs & Sandwich Boards
Many communities place restriction on sandwich boards without taking into consideration how effective they are at driving business to local stores.

This hand painted sign also reinforces the
brand of the store. You can't walk past this store
without noticing it. The lovely window display doesn't hurt either. 

This level of clutter isn't necessarily productive. Regulations can be written to
limit the places of A-frames to an area immediately in front of a business. 

Winter Light Festivals: Inspiring Examples

It is that time of the year when downtowns and commercial districts put up their holiday lights. Many districts, however, go beyond the typical Christmas lights. In an increasing number of cities across the world, large-scale light installations that blend art and technology are making their mark, lighting up the night of downtowns and neighborhood commercial districts. Many of these light festivals include interactive elements that turn spectators into participants, while others include live music, performances, street food and a variety of community events. Light festivals are also tourism magnets, attracting locals and out-of-towners alike to waterfronts, historic districts, and other neighborhoods on dark winter nights or during other periods when tourist activity may be low. Below are some inspiring examples.

Amsterdam Light Festival

From December until January Amsterdam lights up for the annual Amsterdam Light Festival. Over 35 artworks from international artists, designers and architects find their way alongside two different exhibition routes: ‘Water Colors’, the boat route and ‘Illuminate’, the walking route. Organized and managed by a public-private partnership between the municipality, the cultural sector and numerous businesses, its Board includes representatives from the cultural sector and various businesses in Amsterdam.

The festival offers a stage to light artists from all over the world to present their work in Amsterdam for two months and stimulates them to push their own boundaries and innovate. A jury selects the artworks that will become part of the festival.  In 2016 about 1800 artists from 93 different countries were interested in participating in the festival, of which 35 concepts were selected.

Luci d'Artista, Turin

Since 1998, the city of Turin, Italy, hosts the ‘Luci d’Artista’ a series of light installations that combine art and technology to illuminate the city’s streets and piazzas during the holidays. Since its first edition, the event became a point of reference for Italian contemporary artists to showcase their work and has attracted an increasing number of local and international visitors.

Nabana no Sato Winter Illuminations, Japan

From November to March, Nabana no Sato is one of the largest light festivals in Japan. There are various attractions including a huge field transformed into a sea of lights below an animated light show, light tunnels and an observation deck that lifts visitors high above the park where they can get a bird's eye view of the lights.

Pittsburgh Light Up Night

Light Up Night is a festival in Pittsburgh held during the winter holiday season. Many retailers in downtown Pittsburgh remain open late, and street vendors and other concessionaires sell food and give away hot beverages, treats and promotional items. The city is decorated with Christmas lights, trees and other holiday decorations. On Light Up Night, the skyscrapers and buildings in and around downtown keep their lights on throughout the night, lending to the name. According to local news, over 200,000 people attend the festivities.

San Antonio River Walk Holiday Lights

During the holidays the historic streets and famous River Walk of San Antonio, TX, are illuminated with millions of decorative lights, which are part of a number of lighting events including the Ford Holiday River Parade (the event that kicks off the holidays as thousands of lights illuminate the River Walk and decorated floats wind through the river in one of the country's only nighttime river parades), the Ford Fiesta de las Luminarias (visitors of all ages  stroll along the banks of the San Antonio River guided by more than 6,000 luminarias. These warmly glowing candles in sand-filled bags line the walkways to symbolically mark the "lighting of the way" for the Holy Family), among other events that together attract thousands of visitors to the city every holiday season.

Rochester, MI, Bright Light Show

For the past eleven holiday seasons the buildings of downtown Rochester, MI, have their entire facades covered with over one million points of LED lights to create The Big, Bright Light Show. The Big, Bright Light Show is typically held in conjunction with the Lagniappe festival. Created for downtown merchants to celebrate the holiday season, Lagniappe comes from the Creole word meaning "a little something extra" and retailers provide discounts and giveaways to their customers.

Everything you need to know to attract Millennials to your businesses

We are seeing the term 'Millennial' being used more and more often in various discussions, but what does it mean to retailers? Who are these Millennial customers that are so often being referred to?

In a post earlier this year, ShopperTrak, a company that focuses on shopper analytics, revealed that Millennials between 19 and 35 years of age are price-conscious consumers who are willing to do extensive product research before making purchases. Despite this, they continue to be more loyal to quality products and brands and also expect a retailer to be more "socially conscious, give back, and have a positive impact on society." In other words, Millennials can be a challenge to many retailers. 

Some merchants we've been engaged with recently in our work complained that young Millennials don't have any money and aren't coming to their stores to shop. As a result, these owners have since redirected their attention away from this group of visitors even though the group is slated to possess over $200B in collective annual spending power by 2017. Are their actions founded or is there something they are missing to grab the attention of the challenging Millennial shopper? Here are some strategies that retailers can pursue in order to attract and retain the ever-growing Millennial customer base:

Strategy #1: Ensure convenient digital presence 

Over 92% of Millennials own smartphones and 69% read product reviews on their mobile devices. These statistics indicate to retailers the importance of having an online presence that enables Millennials to not only read product reviews and do their buying research but also to make instant purchases. In addition, retailers should also leverage social media as a key marketing tool to reach Millennials. Applications such as Instagram and Facebook are fast turning into the latest version of 'word-of-mouth' recommendations and this has been shown to be the most effective form of 'advertising' for Millennials. 

Strategy #2: Support a cause and make it known

As mentioned earlier, Millennials have shown that they value companies that support a cause and give back to society rather than just simply making profits. According to research from Barkley, an independent advertising agency, more than 50% of millennials make an effort to buy products from companies that support the causes they care about. TOMS shoes and Warby Parker are some useful examples of socially-conscious brands valued and supported by Millennials.These companies give back by donating one of their very own products for every one purchased and have not been shy about publicizing their respective social missions. There are of course other brands that simply donate a percentage of profits to a charity of their choice. 

Strategy #3: Create a helpful and authentic in-store experience

Millennials prefer an “experiential” retail environment where shopping is more than a transaction and forcing of goods. The trend of carefully curating product assortment and customer experiences in brick and mortar stores is spreading fast. Someone walking into a Warby Parker showroom, for example, is immediately transported to an old library through interior design and staff roles. The showrooms not only expose the customer to a range of eye wear neatly displayed on book cases, but also to carefully curated reading materials that are presumably desired with better eyesight. Sales associates' deep knowledge of products on offer also make the in-store experience substantially better.
All in all, Millennials want to be brought on an engaging and unique journey that most importantly provides them useful information regarding products on offer. 

Regardless of the challenges in attracting and retaining Millennials, it is important for retailers to note that they are influential trend setters. Non-Millennials are apparently following in their foot steps and lifestyles so the faster retailers catch on to these strategies that appeal to Millennials, the more effective they will be at attracting even more non-Millennial customers too.

Retail Insights: Does the growth in on-line retailing spell doom for downtown? And what can you do about it?

Last year e-commerce sales hit $343 billion - that is triple the figure it was just ten years ago. Upon hearing this, many cities and towns across the country have started scrambling to address the issue. But like most complicated issues, the challenge from e-commerce is more nuanced than that $343 billion dollar figure suggests. For example, Amazon.com, the largest on-line retailer in the market, comprises a mere 1.4% of all retail sales. And according to a report by Mckinsey & Co., only 35% of Amazon's customers transactions are fulfilled by Amazon itself. That means that the balance, or 65% of all Amazon sales are derived from third party sellers. Another issue with the figures is that they reflect sales from BOTH pure-play Internet retailers AND bricks-and-mortar retailers who are selling on-line. When we dig further, pure-play Internet sales likely represent only about 3% of total sales, according to a report by the International Council of Shopping Centers.

This does not mean that our Main Street businesses are out of the woods. Mckinsey estimates that some retailers will see a decline in in-store sales by 5-7% a year. Others in the industry suggest the impact will be as high as 10-15% of sales. For a small business, really for any business, that is the difference between paying rent and shutting down. Businesses will also face pressure from shoppers who can quickly and easily compare prices - often while they are in the store - and elect to spend their dollars elsewhere if they find a better price. But the cards are not all stacked against smaller merchants. High-touch items (like apparel) and experiential activities (like dining), continue to drive customers to physical stores. And a shopper that is in a store is much more likely to purchase something - even at a slightly higher price point - because the inconvenience and time cost associated with going elsewhere may not be worth it.

So, are customers changing the way they shop? Absolutely. Will there by casualties among brick and mortar retailers who don't keep up? Without a doubt (see Sports Authority and Aeropostale). But the line between virtual and actual stores will become blurrier over time, not more divided. Experts suggest that E-tailers are outgrowing their digital footprint and seeking space in the real world because they know that giving customers the opportunity to see and touch merchandise is critical to sales. Consider Modcloth, a on-line only retailer who recently opened a store in Pioneer Place in Portland, Oregon. Or Fabletics, Blue Nile, Birchbox, Amazon, Bonobos, Warby Parker, Peleton, etc...all of which have opened physical stores. This doesn't always mean they sign long-term leases for traditional retail space - in some cases kiosks or pop-up stores help bridge the gap between an on-line seller and a brick and mortar presence. Amazon, for instance, has set up 16 pop-up shops around the country that allow people to test products and services and has indicated plan to open as many as 400 brick-and-mortar stores. According to GGP CEO Sandeep Mathrani, 60% of venture capital money being raised today is focused on bricks-and-mortar store.

If we can understand why e-tailers are opening bricks and mortar stores, we can begin to understand the opportunities inherent in a physical location. These include higher conversation rates among customers, i.e. the likelihood that someone who walks into your store will buy something. E-tailers  also recognize the power of brand awareness. "Thousands and thousands of customers have discovered us through Nordstrom" Bonobos CEO Andy Dunn told Bloomberg journalists in February, going on to say, "we view is as a way to reach a much more diverse audience much more quickly."

Here are a few others things to be on the look out for as e-commerce changes the way people shop...

Demand for smaller space will rise
Another opportunity is the potential reduction of physical square footage necessary for traditional big-box retailers. Consider Target's aggressive growth of the "CityTarget" brand. Customers can purchase from Target and arrange for store pickup - effectively making the target a fulfillment center/warehouse right in the middle of the commercial district. Consider Target's new store planned for Central Square in Cambridge, MA. It will consist of a mere 21,000 sf of space on two levels (paltry compared to the average target store of 135,000 sf).

Businesses will need to invest in omni-channel sales 
As e-commerce grows, small businesses will need to get in on the action. Businesses looking to participate in the on-line sales game have a few options. In a previous post, we described a few ways in which businesses can sell through established venues (like Etsy or Amazon) as well as a few tools that allow them to create their own websites. BID's and City's can help support the growth on omni-channel selling by providing training and technical assistance to businesses.

Small businesses will begin to incorporate home delivery
Local businesses are already in the community, and with some investment in delivery, can serve as mini-fulfillment centers as well. The benefit is that if something goes wrong, the customer knows precisely where to go and who to talk to to remedy a situation.

An omni-channel sales effort will cannot end with the launch of a website
Putting a website up cannot be the end all be all. Without clever marketing, especially on on-line platforms and social media sites, efforts to sell on-line can fall flat without the right follow through. This is where many businesses falter - they may not have the staff or resources to maintain and build an on-line presence. Many small business owners are just trying to run their business. We posit that this is where a supportive organization - like a BID or Chamber - can be extremely helpful, but pooling together resources and launching marketing campaigns that draw attention to businesses that are selling on-line. They can also enlist local colleges - a business school marketing class, for instance - can be a great opportunity for businesses to get help they need from savvy young people looking for real world experience and the social media know how necessary to build on-line awareness of the website.

Enhance the experience
As we have written about before, (see How can downtown remain competitive in the face of online shopping?) malls are increasingly looking to round out retail offerings with experiential activities - things that, you guessed it, cannot be accomplished on-line.  The Palisades Mall, a super-regional mall outside of New York City has built a ropes course in what used to be an open atrium.

In this time of rapidly evolving shopping habits, small businesses are being challenged. Those that succeed will be the ones that continue to embrace new ways to meet customer needs through high quality service, on-line purchasing options, and an unrivaled in person experience that allows a shopper to touch and feel the merchandise. The goods news is that these are things that our downtown merchants are poised to offer in spades.

Outdoor Seating: Recent Trends and Insights

Outdoor seating is an increasingly popular way to activate streetscapes and encourage economic development in neighborhood commercial districts. Outdoor seating has the capacity to attract more patrons by blurring the boundary between inside and out and bringing vibrancy to streets and commercial corridors.  Furthermore, it expands seating capacity for businesses and reinforces the image of a thriving downtown.

This London restaurant added removable planters to separate eating and circulation areas

During our work at LOA we have met many business owners who have shared with us the benefits that adding outdoor seating have brought to their businesses.  In fact, recent research by the Simons Advisory Group has shown that a simple deck or patio can increase revenue by up to 30 percent. What is it about outdoor seating that has such a large effect on customers? There are many factors involved, most of which revolve around comfort. Some people say that an outdoor dining experience makes the food taste fresher and better. Others simply enjoy gazing at the view as they share a meal with friends or family. Below are some recent trends*.

Sidewalk seating

One of the easiest ways to offer customers the joys of an open-air dining experience is to add a sidewalk dining area with a few comfortable sets of tables and chairs that match the restaurant’s theme. Sidewalk seating gives lots of flexibility, too. During lunchtime, diners will appreciate a casual dining experience as they watch pedestrians or sip a cold beverage while they enjoy the shade. At night, candles or umbrella lighting can make the atmosphere more intimate and create an attractive display for onlookers to enjoy. 

The added seating outside this bakery have brought vibrancy and liveliness to this section of Broadway, NYC

Rooftop dining

What if the business doesn’t have the space to expand outward? In these instances, many restaurateurs are instead choosing to expand upwards. From London to New York, diners everywhere are talking about rooftop eateries. Why? Because the bird’s-eye view allows them to take in beautiful city skylines or wide-open landscapes as they dine.

Dining in the garden

One of the industry’s hottest trends is farm-to-table food, and it’s a trend that is easily combined with outdoor dining. To take advantage of this trend, it’s less about the space — a sidewalk, deck, patio or rooftop — and more about what you grow in it. Some restaurants are landscaping their outdoor dining areas with the same fruits and vegetables that they’re serving their customers. With the addition of a few raised beds, you can create a wonderfully relaxing environment for your guests while growing some of the lettuce, tomatoes, peppers and other fruits and vegetables that you’ll be serving.


 Inspired? As a downtown district practitioner you can (and should!) encourage the trend:

• Consider a program for helping local business owners navigate permit process and even a grant to offset their initial costs (i.e. to help with design services, or outdoor furniture, etc.)
• Help with expediting the process. Nearly all municipalities require some sort of outdoor dining permit so consider creating a simple guide to the permitting process or providing individual guidance to business owners.  
• Track the number of establishments with outdoor seating and share their success with other business owners. This could inspire many others to join the trend.

*Based on trends by Jeff Caldwell written for http://www.fastcasual.com

Enhancing Business Visibility: Six Tips for Producing Effective Retail Signage

It is well know that visibility is a key factor to retail success. Quality signage can be an easy and effective tool to make sure passersby see (and perhaps enter) business establishments. An effective signage not only shows customers where businesses are, but it also communicates their brand and identity and can be a powerful tool shaping overall corridor and district perception.

While it’s clear that signage is an essential tool to operating a successful retail establishment, there are many factors that must be considered when developing an appropriate signage strategy. Below are six tips to have these in mind when working with local businesses in facade improvement or district beautification efforts.

Example of clear and visible signage (note that despite being on the window, the signage did not obstruct views to inside the store)

Tip 1: Focus on Customer Experience

At the most basic level, retail signage has one purpose: to communicate with the customer. Businesses should prioritize this goal above all others when developing retail signage. After all, what’s the point of a sign if the public can’t understand the message around it? There are several ways to improve the customer experience.

Make sure businesses signage have appropriate size and placement. If signs are too big your district might end up overwhelming customers. If wrongly placed, signage might not be seen or might block another business signage, generating conflict and visual confusion for customers.

Analyze the district with fresh eyes. One of the best ways is to walk your district like a customer. Be honest about what works and what doesn’t. What’s easy to find, and what is missing? Are the signs easy to understand, or are they jumbled or confusing?

Tip 2: Think About Location, Location, Location

Sign placement can seem deceptively simple, but there are many important elements to consider. Of course a sign needs to be placed in an appropriate location where it can be seen, interpreted and ultimately drive consumer action. But what else do you need to consider? For exterior signage, make sure businesses place it where it can be seen by as many passersby—on foot and in vehicles--as possible. Consider factors like glare, and what might block it (parked cars? Delivery trucks? Hot dog cart?) at different times of the day or week. Effectively placed, businesses will have a guaranteed presence worth far more than the cost of the sign installation. As an expert marketer put it: “You pay for your signs once, and they work for you 24 hours a day, 7 days a week.” (Bang 2011)

This creative signage spruces up the store entrance and reinforces the business identity as an antique store

Tip 3: Check out the Competition

Do your homework and check out other stores signage, especially the ones you admire. They don’t have to be in your district.  Pay attention and consider whether it’s a good model for the businesses in your district. By benchmarking other businesses (and districts), you just may discover something that you should do—or even not do—in your own district.

Tip 4: Get the Look Right

Once the type and placement of signage is established, it’s time to make sure the messaging looks professional and well-designed. There are some basic graphic design rules that should always be followed. “Be consistent with the feature lines, price, size, color, and fonts so the customer’s eyes can easily scan the sign. Allow for plenty of white space, keep the font simple, be sure the text is balanced and proportional and consider using bullets. Highlight words in bold or by using a different color. Avoid using all capital letters, which makes it difficult to read.” (DS 2006)

Color choices are also critical. Even a sign that looks nice and professionally designed from an aesthetic perspective may not be as readable as it needs to be in a retail environment. Using contrasting colors in the font and background is highly recommended. The most visible colors are black, white and red for the text, and these should be printed over backgrounds that are as opposite as possible. For example, white text on a black background, or red type over a yellow background can improve readability. Backgrounds that are nearly the same color as text can render signs nearly unreadable.

Tip 5: Be Clear and Keep it Simple

Clear, compelling messaging is what sets apart great signage from mediocre. Different signage has specific goals, and when a retailer can convey these distinct messages in a way that is clear, informative, and above all, still on brand, that business is going to be more competitive. Informative signage such as directional signage must be concise and readable to enable users to understand the message with a split-second glance.

Good quality signage doesn't require expensive materials. With simple paint is possible to have attractive and efficient signs.

Tip 6: Make Quality a Priority

Given that all business owners know how critical it is to inspire trust in their customers, it’s surprising how many stumble at producing well-made, error-free signage. And it doesn’t have to be this way. Creating quality signage is an easy and inexpensive way to cultivate that trust. “Signs will convey your authority and attention to detail. Make sure they are clear and accurate every time. Poorly printed signs, misspelled words and other inaccuracies can erode your credibility.” (Kinsella 2012)

Simplicity is key.  To be effective, signage must be easy to read. As some experts warn us: "Some signs are so full of tiny images, starbursts, exclamation marks, and small print, that you can’t take it all in.” (Inspire 2013).

Blade signs are a very effective way to capture pedestrians’ attention. The signs above are simple, straight to point and very effective in communicating what these businesses are about.

Works Cited/Referenced:

Business 2 Community. 5 Ways for Retailers to Drive Sales Using Digital Signage. 2012. Source Link
DS Marketing Solutions. Retail Signage…Tips for Increasing Sales & Service. 2006. Source Link
Foxfire. How to Start Using Retail Signage. Source Link
Inspire Retail Solutions. How to Create Effective Retail Signs. 2013. Source Link
John Kinsella. IGC Retailer. Powerful Signage Promotes Your Brand. 2012. Source Link
Kevin Johnston. Demand Media. Rules for Effective Retail Signage. Source Link

Bang Advertising. Why Exterior Signage Provides the Best ROI for Retailers. 2011. Source Link

http://www.signsbytomorrow.com/custom-retail-signage

Emerging Ideas in Community Tourism Planning - Part 2

This is the second in a three-part series exploring ways communities are playing a greater role in planning and developing their tourism industries. Guest blogger Joe Bly is a former documentary producer and writer, going beyond film and television to tell stories of social and urban progress.

Before the drama of the Olympic games in Rio de Janeiro can begin on August 5^th, and the Paralympics in September, another drama has to conclude:  preparing the city to host one of the biggest and highest profile events on the planet.  Of course, when selected in 2009, Rio was already a premier tourist destination, with tourism revenue representing 67% of the city’s GDP.  It hosted about 1 and a half million foreign tourists that year, a third of those for a single event, Carnival. 

But since then, Brazil has spent almost $12 billion upgrading nearly every level of infrastructure required to host the games.  That’s not just for specialized sports facilities and team dormitories.  The city has struggled to completely revamp its train and subway systems, water and waste management systems, and amid controversy, relocate entire residential neighborhoods.  This to host what is essentially a single, unique visitor attraction.  And every effort is stalked by questions of what is the ultimate benefit, and for whom. 

Here is where we can draw parallels and lessons for any location scaling up tourism capacity.  Even at the other end of the spectrum, a locale with little or no tourism infrastructure or resources, the issues of effective capacity building and community benefit remain the same.  So what does launching a tourism industry from scratch look like?

Community-Based Tourism

Community-based tourism (CBT) is a model in which often remote communities host visitors in the homes of residents and provide access to their unique attraction and cultural events.  The most familiar form is ecotourism.  2800 miles northwest of Rio, the Manaus region of the Amazon is home to numerous community-based ecotourism projects.  There is little tourism infrastructure deep in the jungle, but trekkers can homestay with local families, hire guides and riverboat excursions and buy local foods and handicrafts.  The cultural access is as unique an offering as the setting.  Most programs are planned and administered entirely by local residents with training and guidance provided by the government or NGOs.  The emphasis is on creating direct and sustainable economic benefit for local residents and enhancing their autonomy, while requiring little capital.  This approach to tourism is found in nearly every developing country in the world.

Yet CBT in this form is virtually nonexistent in the United States.  Could this approach be adapted to locales here that wish to develop a tourism industry where none existed before.  I found one rare example in a very small community that shares a communally held resource as exceptional as any Olympics – a cultural heritage of quilting. 

Tourist economy built by hand – Gee’s Bend, Alabama

In the heart of Alabama, there is a bow in the Alabama River wrapping around the area of Gee’s Bend so as to almost make it an island, nearly inaccessible, but for one road and a ferry.  It is a very rural home to about 200 mostly African American residents.  What puts it on the map is a long history of exquisite quilts made by generations of Gee’s Benders.  These quilts have hung in museums and art galleries, and have sold for as much as $20,000.  But Gee’s Bend had almost no ability to accommodate visitors interested in quilting and local heritage; there was little coordinated marketplace where quilts could be found, no eateries or overnight lodging, and no related cultural or historical programming.  Development grants from the Ford Foundation and tremendous assistance from groups like Sustainable Rural Regenerative Enterprises for Families (SURREF), and Auburn University, have allowed Gee’s Bend to decide collectively how to develop a community based tourism industry, physically and in expertise.

The Gee's Bend Quilt Mural Trail 

The highlights:

The Gee’s Bend town of Boykin already had a quilting collective established during the Civil Rights movement that met and worked in a community building.  This collective and building has been developed into the hub of quilt visiting, serving as a shop, museum, information center, and classroom.

An organized quilting trail and maps now help guide visitors through the area. Quilters offer overnight stays in their own homes. Staffing is local.  Marketing, sales, tours, visitor services, retail are all staffed by trained local residents.

Renovations and construction of new buildings such as additional guestlodging and a food center is done by local labor with an emphasis on locally-sourced materials.

The Gee’s Bend area now has a café, renovated guest houses, a calendar of events, and is promoted regionally and statewide.  Through community-based planning and implementation, residents are able to capture more of the economic benefits, while preserving and promoting a unique heritage.  The takeaways could apply to any locale in the US starting from scratch, and maybe even Rio.  CBT emphasizes collective decisions about how a community exploits its communal resources, and as in Gee’s Bend, every development has to maximize benefit.  More than just raise tourism revenue, any effort or investment has to cultivate ability and entrepreneurship within the community, adding mutually supportive, interlocking pieces of capacity.  I can think of no better metaphor than a quilt.

The Gee's Bend Quilting Collective in Boykin, AL

It has never been easier for a community, lacking any accommodations, to market themselves and host visitors from anywhere within their own homes – now that Airbnb and short term rentals are almost instantly ubiquitous.  Yet we do not yet see widespread community-based tourism facilitated by Airbnb.  What’s missing - the coordination.  My next post asks ‘Is any locality or community coordinating short term rental as a tourism development strategy?’

Emerging Ideas in Community Tourism Planning

This is the first in a three-part series exploring ways communities are playing a greater role in planning and developing their tourism industries. Guest blogger Joe Bly is a former documentary producer and writer, going beyond film and television to tell stories of social and urban progress.

Community Tourism Planning in Hood River, Oregon, has benefited downtown through increased economic activity

As we are arriving at a tourism or vacation travel destination, what often goes by in a blur, at first, is the community that surrounds it.  Other times, unique neighborhoods themselves are the destination, and we’re alert to every nuance.

In either case, we eventually leave with lasting impressions, whether we realize it or not, that are rooted in the relationship between the attraction and the supporting community.  Did we feel welcomed as visitors?  Were the residents and the area benefitting broadly from tourism, or was all the business captured by a single attraction?  Did we feel exploited by a “tourist trap”, or did we go unnoticed, our getaway about being able to pretend for a little while that we lived there ourselves?  How do we feel about tourists in our own town?

Increasingly, attention is being paid to the relationship between the community and its tourism industry.  Community Tourism Planning is a planning approach that recognizes the contributions of the host community:

• Local residents are the owners, operators, and workers of the tourism base.

• Communities are the source of the culture or character that attracts visitors, the “flavor”.

• More than ever, residents are literally the hosts, using Airbnb or other means of private short term rental to physically host visitors in their own homes.

Therefore, Community Tourism Planning, or Community Tourism Development, encourages greater input and determination from a community in the strategic planning of local and regional tourism, in order to:

• Ensure that tourism plans are aligned with overall community values and goals. 

• Create a collaborative partnership between residents, businesses, resources, and planning authorities.

• Work with communities to balance the positive and negative effects of tourism

• Ensure that the whole community is the ultimate beneficiary of sustainable tourism activity.

Municipal governments, visitors bureaus, and tourism development groups find that communities involved in planning remain active participants and are also supportive of initiatives, regulations, or changes to policy needed to pursue the collective mission.  As tourism becomes more diverse in its offerings, spread out geographically, and democratized by attractions and visitors interacting on social media, community tourism planning will be a way for planning authorities to continue to provide leadership and coordinate their goals.

The University of Minnesota Extension has created a community tourism development project that publishes resource material articulating guidance particularly well.

http://www.extension.umn.edu/community/tourism-development/

http://www.extension.umn.edu/community/tourism-development/materials/development-manual/docs/08665-pp29-34.pdf

In many ways, the process is similar to other kinds of cultural or business development assessment and planning.  The quality of community engagement is the key factor to success.

Inventory – The Community Identifies its Tourism Assets

Hood River Fruit Loop Map

The Hood River Valley of Oregon has long been a center of apple, pear, and cherry farming.  It is also situated in the scenic Columbia River Gorge.  When the area’s agribusiness base began to fade in the 1990s, communities focused on what they felt were their two most valuable assets:  local food products and scenic environs.  From this inventory, Hood River County growers associations and state development grants created a wildly successful agritourism zone known as The Fruit Loop.  The Fruit Loop is now a 35 mile road route guiding visitors to farms, farm stands, and wineries of the Columbia River Gorge.  The Hood River Chamber of Commerce Visitor Council publishes maps and coordinates a calendar of events to bring tourists to harvest and blossom festivals year-round.  In 2014, approximately 125,000 visitors spent almost $88 million dollars in this rural county.  The Fruit Loop has become a model for inclusive and sustainable food tourism because its development is anchored in what the community believes it does best (http://hoodriverfruitloop.com/)

Mt. View's Fruit Stand, open each harvest season from July through November, is the not-so-hidden treasure of the Hood River County Fruit Loop 

Participants - Harness Community Initiative and Identity

Washington D.C.’s Neighborhood Heritage Trails are official walking tours of the District’s historic neighborhoods, illuminated with historical markers, signs, photographs, and audio tour guides.  Cultural Tourism DC is the nonprofit group that coordinates the funding and technical assistance to implement the tour routes – but the historic themes, research, and planning are articulated and conducted by the neighborhoods themselves.  Prospective communities submit proposals for routes and points of interest.  If selected by Cultural Tourism DC’s committee, they receive funding to organize and conduct their own historical research and receive guidance in assessing and developing the neighborhood’s capacity to support a permanent tour offering (transportation, available public restrooms, businesses on the route are informed and can answer questions).  Enticing visitors to explore, eat, and shop “beyond the monuments”, the tours become economic boons to neighborhoods further away from D.C.’s most iconic landmarks.  But the benefits also go beyond financial.  Supporting communities in their own heritage tourism development stimulates a conversation, taps the knowledge and memory of life-long residents, and fosters a sense of neighborhood identity.  The program now boasts 17 distinct heritage trails on historic themes from art history to civil rights (http://www.culturaltourismdc.org/portal/neighborhood-heritage-trails).

Knowledge partner case studies of developing neighborhood cultural tourism include:

http://livable.org/storage/documents/reports/CBC/culturalheritagetourism.pdf 

Future posts in this series will take a closer look at issues related to community tourism planning. 

Community Based Tourism:  CBT is a tourism development model that relies entirely on the host residents and resources where little or no tourism infrastructure or authority exists.  At the moment, this kind of thinking is applied to very poor or isolated communities possessing a unique attraction, like a village in Tanzania that hosts wildlife tours.  Couldn’t these same principles be applied to any locale here in the U.S. with a natural or cultural attraction, but few resources to develop them?

Airbnb as economic development plan:  Platforms that facilitate short term rental make any property owner a participant in their local tourism industry.  Municipal governments across the country are responding largely with regulations and restrictions on private short term rentals.  Is there a municipality doing the opposite – embracing, supporting, or even helping coordinate short term rental as part of economic and tourism development?

These and other stories from where the rubber meets the road, or the comfortable street shoe meets the walking tour. 

joe bly

Want to know how to make quick friends in the retail industry, and maybe even keep rents reasonable at the same time?

Have you given much thought to what is arguably the most important metric in retail attraction - the sales volumes that retailers can realistically achieve in your district? This data is like the holy grail - everyone is looking for it but very few people know how to find it. Brokers need this information to attract retailers. Retailers need this information to understand what kinds of rent can be supported, and property owners need this information to know what kinds of rents are rooted in reality when setting rental rates. In the commercial real estate industry, the term used to describe and measure a retailer's sales is known as sales per square foot. This "apples to apples" metrics allows us compare and contrast sales figures between markets and retailers. To give you a point of reference, sales productivity in 2015 for non-anchor tenants in U.S. Malls was $474 psf annually. To put this in context, base rent to sales ratio varies from 4-30% depending on the type of business, but for most retailers, base rent should be no more than 5% to 10% of annual gross sales. Assuming a retailer making $474 psf is paying 10% of their sales to rent, their rent would come to $47.40 psf annually. 

Flagship environments are special

It is helpful to keep in mind that in some markets rent has very little to do with how profitable the actual location is. Retailers treat these locations as extensions of their brand, and they will pay what amounts to a marketing fee for what they consider critical brand recognition. For example, along 5th Avenue in New York, one of the world's most coveted retail address, the bag maker Coach recently signed a lease for $4,000 dollars a square foot. That is a big number - a REALLY big number. In fact, not a single publicly traded retailer, with the exception of Apple stores with an estimated $5,626 sales per square foot, sells enough of anything to pay rent levels that high. Not even Tiffany & Co., which is the second most profitable retailer at $2,974 per square foot. But I digress…most districts are not vying for retailers who can pay these kinds of rents. 

The Coach flagship store on 5th Avenue is paying $4,000/sf in rent.
Do you think the sales at this location can support that?
Image Source: Fashionmag.com

What kind of rent is reasonable?

So what kinds of rents are fair game, and how can you tell whether your landlords are asking rents that make sense and will allow a retailer to make a profit?

Let's consider Marshall’s on 125th Street in Harlem, NY. Reported annual sales are $33.9 million dollars spread over 57,000 square feet. This comes to $595/sf in sales. Assuming that Marshall’s is paying between 10% to 15% of sales on rent, their ideal rent would fall in the  $53 to $80 dollar range. When Harlem Center where Marshall's is currently located was signing initial leases in 2002, the landlord was asking between $80-100/sf for the ground floor. Marshall’s, located on an upper floor is undoubtedly paying less, putting the rent in the 10-15% ratio sweet spot.

So where do you find this information?
Well, the good news is that this information can be found for publicly traded companies. InfoUSA is the go to source for sales volume figures. Both ESRI and Claritas use InfoUSA for their business list data. However, private retailers are not obligated to share this information. For most of the districts we work in that means there is no sales data of which to speak. Instead, what both ESRI and Claritas do is model estimated sales figures for these privately owned businesses based on sample business data for millions of other retailers. While is is generally OK, in some cases this ends up giving you clearly inaccurate information. For one high end apparel brand in a flagship district where rents have peaked at $1000/sf we were given an annual sales figure that hovered around $278/sf. Unbelievable and highly unlikely, especially when other similar retailers report selling up to $1,500/sf. But then the algorithm that ESRI uses did not take into account the unique characteristics of this store and its hyper luxury nature. They treated it like any other apparel store and spit out data that wasn’t commensurate with what we know and can determine from what we see.

Overcoming this information gap takes perseverance. It means asking businesses, brokers and property owners what kinds of annual sales their stores are doing. It means keeping a spreadsheet of this primary data alongside the SF of each store and maintaining calculations that keep you informed. This alone will make you and your organization an invaluable resource to your retail real estate partners. 

On-Line Selling - an Option for Smaller Businesses?

Image source: www.forbes.com/sites/samsungbusiness/2015/02/09/

It wasn't long ago that many predicted the death of the brick-and-mortar store at the hand of the on-line retailer. However, recent research conducted by the International Council of Shopping Centers (ICSC) finds that the relationship between on-line retail and physical stores is becoming more intertwined. In fact, retailers with robust "omni-channel" strategies, i.e. those backed by physical stores in addition to on-line platforms, generated the most on-line sales. As the report points out, physical stores are still central to the whole enterprise, but they are increasingly used in conjunction with other product delivery methods and serve to enhance retailers image in their trade area.

Housingworks, a New York based non-profit that operates a small chain of thrift stores,
has set up a dedicated on-line auction platform. 

Large retailers continue to expand their omni-channel retail presence in a variety of ways including ‘buy online and pick up/return to the store’ features that are increasingly popular. But the ability to omni-channel is no longer limited to deep pocketed big businesses. In this post we explore options available to smaller retailers who want to offer customers multiple ways to buy their goods, including from the comfort of their own homes.

While the decision to sell on-line is one made by the retailer, commercial district practitioners can help their businesses by informing them of their options for selling on-line and helping market and promote those businesses that already have on-line sales platforms.

Option #1: Creating a dedicated website 

While selling on a dedicated website requires a higher investment of time and resources, it can be a worthwhile effort that allows for a greater level of control and branding by the retailer. Below are some of the most popular platforms being used today. 

Wordpress - WordPress is a well-known and very user-friendly platform that allows small businesses to set up a great looking website in a very short time, as well as customize it to suit their needs without detailed programming knowledge. The standard payment option with this is PayPal. Going through PayPal requires a bit of extra effort on the part of the shopper, so those looking to sell quickly could check out plugin options like WooCommerce or Selz at an additional cost.

Wix - is a cloud-based web development platform that allows small businesses to create web sites and mobile sites through the use of online drag and drop tools. Their beautiful templates are customized for a variety of business types (from eating establishment to beauty salons, among many others) which include particular features that are useful for each business type (for example, restaurant templates come with online ordering and reservation options). The platform includes some interesting features such as text and writing help from professional writers for the website content, and the inclusion of video backgrounds in the website.

A nice looking template for a coffee shop website from Wix

Bigcommerce -  is a little different from Wix and Wordpress as it consists of a comprehensive ecommerce solution for small businesses that integrates multiple points of sales (POS). This means that besides creating a website and selling from it, Bigcommerce offers a platform for merchants to also sell through social media (on their Facebook page, on Pinterest, etc.), as well as on their physical stores or in fairs, pop ups or markets. Some interesting features include the analytic reports which give business owners insights of sales trends, and a customer profile section that allows business to learn about their customers and shopping habits.

Square Market -  similarly to Bigcommerce, Square Market consists of a comprehensive ecommerce solution to sell online, which can be through the business own website or with third party e-commerce sites, as well as in physical stores, fairs and markets. The platform is also customized for particular business types and includes beautiful but limited template options. Its analytic reports are a great feature as its ability to integrate inventory control between online and offline sales.

Shopify - is  quickly becoming one of the most popular ecommerce platforms in the market. Similarly to Bigcommerce and Square Market, it consists of a multi-channel commerce platform designed for small and medium-sized businesses. Merchants use the software to design, set up and manage their stores across multiple sales channels, including web, mobile, social media, marketplaces, brick-and-mortar locations and pop-up shops.

Leif is a retail website powered by Shopify

Option #2: Using an Existing Online Platform

On-line marketplaces are popular plug-and-play options with many retailers. Below are some of the most popular options.

Amazon - The most visited on-line marketplace selling products from chain stores and international sellers. Includes bulk-listing and reporting tools and ability to have fulfillment handled by Amazon for an additional cost.

Ebay -  a shopping and online auction that allows businesses to sell a broad variety of goods and services worldwide.  It is the second most visited on-line marketplace after Amazon. In addition to its auction-style sales, the website has expanded to include "Buy It Now" shopping. The website is free to use for buyers, but sellers are charged fees for listing items and again when those items are sold.

Etsy - Another very popular marketplace, Etsy focuses exclusively on handmade products and offers retailers an on-line platform that has significant reach. International sellers allowed. Includes shopping cart and image library.

Etsy's product display offers multiple filters that optimize product search and make navigation extremely easy.

Bonanza -  An increasingly popular marketplace, Bonanza sells new and used products mostly from popular brands. Includes photo-editing tools, image library, batch editor, and more. The website and searching tools are less attractive and user-friendly than the more famous online marketplaces.

Storenvy - An on-line marketplace focused on indie brands. Includes inventory and order tracking, visitor stats, mobile friendly component, and image library. Free to open, but extras, like domain support, promo codes, and more will cost various fees. The website is very user-friendly, but its search filter options are quite limited, which makes finding specific products inconvenient for shoppers.

OpenSky - Another online marketplace focused on indie brands. It includes simple management tools, unlimited product listings, and mobile optimization. Extremely user-friendly with several filters that optimize product search and display.

It is worth noting that these options are not mutually exclusive - businesses can have both a dedicated website and offer their products on Esty, Ebay or any other marketplace seller. Selling in multiple places can open business up to consumers that local merchants may have never reached otherwise. Establishing an on-line presence is also a great marketing strategy and may also help boost foot traffic and sales at physical stores (and in your district).

While the time requirements of running a small business may make it difficult for some merchants to consider selling on-line, commercial district practitioners can play an instrumental role in encouraging and providing information for merchants who might be willing to take the next step. 

Patricia Voltolini, PhD is a Senior Associate at Larisa Ortiz Associates.