Not long ago I heard someone comment that “70 percent of shopping occurs after 6 PM”. This is a statement that has been quoted for a couple decades now, and like most people, I accepted it for a long time. The more I became acquainted with retail, though, the more I had my doubts. Eventually I even began to look for a source to corroborate the claim. It seems there really is no source. In fact, the information we do have suggests something very different.
The best source of information is the American Time Use Survey compiled annually by the US Bureau of Labor Statistics. It shows that the number of people shopping actually peaks in the early afternoon and steadily declines through the remainder of the day. Fewer than one in five shoppers are out in the evening hours from six to ten.
The data tells us a few things more. Overall, we are shopping less. The number of people shopping* dropped from a daily average of 38.0 million in 2003 through 2007, to 34.3 million per day in the 2011 to 2015 time period. Comparing evening shopping between these two periods, the percentage of shoppers out during the hours of 6 PM to 10 PM declined from 19.5 percent to 18.7 percent. The percentage of people out during the daytime hours from noon to 6 PM remained relatively unchanged, while there was an increase in morning shoppers (8 AM to noon) from 19.7 percent to 20.4 percent of the total. The morning hours also saw in increase in the percentage of people patronizing service businesses.
Other data sources show that patterns vary for different kinds of retail businesses and shopping formats. Simply open up Google Maps to understand this. When you click on many businesses and scroll down the information window you will see “popular times”, a bar chart that reflects the typical customer traffic patterns for that business, by hour, for every day of the week. A grocery store will typically peak around four in the afternoon while a home improvement center will peak around eleven in the morning. Businesses like a coffee shop may have an uneven pattern of busier and slower times.
The upshot of this is that while our downtown businesses are certainly leaving some of the market potential on the table when they close early, it may not be as much as we have assumed. Whether it makes sense for those businesses to be open in the evening is really a more complex question that needs to factor in the kind of business, surrounding businesses that might help draw traffic, and the additional sales volume that might be captured. If the goal is to capture more sales, these businesses may best be served by encouraging them to develop their web presence, engage in online sales, and provide same day delivery services, rather than simply extend hours.
* Rather than “people” we should probably be using “shoppers by hour”, as the same person might be shopping more than one hour, but the simpler term will make this easier to read.
We are often approached by communities asking how they can attract more retail to their business districts. That may be the wrong question. The retail sector is experiencing a massive transformation as people are spending less, the internet is taking an increasing slice, shopping habits change, and chains continue to close stores at record levels. The best locations will continue to thrive, but all others need to be thinking about a more comprehensive approach to creating healthy business districts, in which attraction is only part of the picture.
Our white paper provides a comprehensive look at how retail is changing and what it might mean for your community, district, or center.
Storemaggedon – Retail Shifts and Communities
Kingman County is one of two counties making up the Wichita MSA in southern Kansas. This largely rural county has been losing population for decades, though that trend may be reversing as people move from the City of Wichita to rural home sites and smaller communities with a more affordable cost of living. The county’s economic development organization is seeking opportunities to retain businesses and attract new ones to the community both for the economic opportunities they provide, and to offer shopping and services to residents.
Place Dynamics was brought in to conduct the market and financial feasibility analysis for three potential uses:
- A conference facility capable of hosting events with a minimum of 100 attendees
- A new hotel, possibly in conjunction with the conference facility
- Retail and dining businesses
The retail trade area for the county and its principal city is really no larger than the county itself. While few single-category uses are immediately viable (aside from a truck stop and restaurants), there is an opportunity for businesses to combine product lines to capture unmet demand.
The City of Kingman can support a new hotel, fueled in part by a 20 percent increase in traffic on Highway 50 over the past decade. A 40-room midscale property was recommended. The financial analysis demonstrated the project’s likely profitability and ability to secure financing based on typical commercial lending criteria.
Few similar rural counties, or communities the size of Kingman have convention centers of the size and character the economic development organization has envisioned. We examined the small handful of comparable facilities and assessed likely competition for the proposed center. The recommended facility will have a combination of dedicated rooms, flexible space, and amenities to enable it to host diverse functions such as business meetings, conferences and some trade shows, and banquets or receptions. A proposed location in the historic downtown, outdoor reception space, allowing outside food, and lower rental fees will help the facility to compete for bookings.
In addition to the location and facility design, the study recommended a management structure, services to be provided, and marketing strategies.
None of the comparable spaces are financially self-sufficient, and the analysis predicted that this facility would similarly need continued financial support. That might not be the case, however, if it were to be developed with grants and donations to defray the estimated $1 million development cost.
Janesville is a city of about 64,000 people located in south central Wisconsin. The City retained Place Dynamics and SAA Design Group to advise it on prospects for redeveloping several brownfield sites along the Rock River where it passes through downtown. Our role was to assess the market opportunity and advise the team on effective redevelopment strategies.
The analysis demonstrated a strong and immediate demand for market rate and higher-end rentals along with owner occupied condominiums. These uses could be successfully developed along the river, where the river itself, along with existing paths and parks would be a significant amenity. Additional riverfront improvements recommended by SAA Design Group would further enhance the area’s potential. To help establish the market for redevelopment, the City will need to be an active player in helping to assemble, remediate, and market properties, as well as provide support for elements of proposed projects such as enclosed parking, which is a necessary amenity.
The market for retail, office, and dining uses in the downtown is presently limited, in part due to a lack of any retail concentration in the district, and in part due to a very large inventory of available space elsewhere in the city. The most likely prospects in the short term will include eating and drinking places, home decor and hobby-related retail, and boutique office users who may be tied to the nearby courthouse.
Layton Boulevard West Neighbors is a nonprofit organization working to preserve the vitality of the Silver City, Burnham Park, and Lincoln Park neighborhoods on Milwaukee’s far west side. These were historically working class areas that developed along streetcar lines from the 1870’s through the early 1900’s, offering housing along with shopping and services for workers in the adjacent Menomonee Valley. As the largely Eastern European households that once dominated the neighborhoods move out, many Hispanic households are moving in. Home ownership in the area remains high, with moderate incomes. These are “moving up” neighborhoods for recent immigrants and first generation citizens who want to own a home.
Our analysis focused on five primary corridors.
- Pierce Street borders the Menomonee Valley, which has been the historic heart of Milwaukee’s manufacturing district. This area is attracting several new green industries and small craft manufacturers that are attracted to the central location and availability of smaller spaces than found in the Valley.
- National Avenue is the most important commercial corridor. Its higher traffic volume, proximity to Miller Park, and existing businesses are a foundation on which to build a destination business district focused on multi-ethnic dining and shopping.
- Greenfield Avenue will largely serve neighborhood shopping and service needs.
- Burnham Street does not have the traffic necessary to sustain the amount of commercial space available. We recommended development around nodes, with the most important of these being around a popular Mexican grocery.
- Lincoln Avenue can serve these neighborhoods along with adjacent suburban areas. The street’s proximity to a large hospital complex presents opportunities to serve workers and patients, particularly for businesses in health care or dining establishments.
In addition to the market analysis, we recommended specific strategies for the organization to pursue in its efforts to revitalize these corridors.
Summary Report: Layton Market Analysis Summary (Letter Format) 2
We recently completed a survey of downtowns for the Wisconsin Downtown Action Council. One of the more interesting findings was a tendency for communities that considered themselves to be successful in implementing their downtown plans to also report the highest vacancy rates in their downtown buildings. When we dug into this paradox we found that respondents in local government positions were most likely to consider their implementation efforts to be successful. For these respondents, downtown revitalization centered on physical improvements such as road reconstruction and streetscaping, downtown plazas, parking lots, and redevelopment projects. Success was measured by whether or not the projects were constructed, and not necessarily upon their impact on downtown businesses or real estate.
The point of this story was driven home as I recently walked the streets of a small downtown in Tennessee. Workers were laying the last bricks in an attractive new streetscape project. As I snapped a picture a man nearby came up to chat with me. After a moment he made the comment “I wish they were as concerned with trying to get businesses in these empty buildings as they were with brick sidewalks.” Perhaps he was a downtown businessperson or property owner, or maybe just an interested citizen, but his priorities were certainly different from those of the city.
We need to recognize that successful planning addresses a wide variety of issues through projects, programming, activities, and other approaches. Perhaps this is a problem with the downtown plans in the Wisconsin example. If these communities’ plans were comprised solely of infrastructure projects, then they missed the big picture. Downtown property owners, business owners, and residents might have told them to recruit businesses to vacant storefronts, provide assistance with marketing and promotions, and make downtown a lively place with events and amenities.
As planners, economic developers, and local government officials it is necessary for us to recognize that success is not defined only from one particular viewpoint. Whether it is a downtown district, neighborhood, city, or region, there will be a diverse set of stakeholders each with their own desired outcomes. Plans should include success measures that can be monitored at regular intervals to determine whether progress is truly being made, or if we are simply implementing projects without consideration of their impacts.
2011 Wisconsin Downtown Survey – Final
Ripon is a remarkable community. Although small and rural, it has an impressive destination downtown district with many specialty shops and restaurants. A recent downtown plan gave many ideas, but did not contain the information that would help the Main Street program determine what was feasible or establish priorities.
Place Dynamics started with a market analysis to determine demand for housing, retail, dining, and office uses. We documented the demand for several types of retail, identifying the number of businesses and square feet that could be occupied in the district. Additional restaurants could also be supported. The visitor market figured significantly in these calculations.
With a declining population base, there was less demand for new housing. The most likely opportunity was to develop 20-24 condominium units, and we recommended the most appropriate of several potential redevelopment areas for this use.