Gerald Divaris, chairman and CEO of Divaris Group of Companies and a panelist at last week’s Entertainment Experience Evolution (EEE) conference, produced by France Media’s Shopping Center Business and InterFace Conference Group, has a Shakespearean take on today’s retail environment. It’s that all the (retail) world’s a stage.
“Retail is essentially entertainment,” he told a crowd of 500 attendees during the Leading Retail Landlords Panel at EEE, which was held Feb. 25-26 at the J.W. Marriott LA Live. “Otherwise, you’d be buying on Amazon.”
Divaris expanded upon this notion, citing that even supermarkets have entertaining “stations,” TJ Maxx provides the opportunity to treasure hunt and Barnes & Noble has made a major comeback by doing little more than allowing guests to thumb through books.
Panel moderator Nick Egelanian, president of SiteWorks, noted much of the current retail experience can be divided into two categories, though it may not be an even split. There are the items consumers want to buy quickly and easily (and arguably cheaply) online, and then there’s what they’re looking for when they walk into a destination.
“This part of retail is about pleasure,” he said. “You either have to have a great place or great retailers or great experiences. Take the principles of pleasure and build them into the built environment. If you think the internet has changed retail in America, you’re not as right as you think you are.”
Creating ROI Through IRL
Providing something enjoyable to consumers doesn’t just bring the warm and fuzzies, many panelists argued; it brings the dollars.
“We make decisions with the emotional side of our brain,” said Greg Little, president of Lumos and a Behind the Brands panelist. “Then we rationalize it with data. If we can appeal to that guest experience and create a feeling — an emotional impact — then they’ll say, ‘wow, I wanna come back.’ They’ll tell people about it. Focus on the emotion.”
One of the best ways to create this emotional connection is through the new and novel.
“Try not to copy or recreate something that people already have,” advised keynote speaker Steven Schussler, chairman of Schussler Creative. “I like to build based on shock and awe. Do things totally against the realm and remember that passion is the engine of success.”
For Schussler, that “passion” culminated in the creation of immersive food-and-beverage experiences like Rainforest Café, T-Rex Café, Yak & Yeti and other concepts, which are enjoying a successful run at Disney World in Orlando, Fla.
The other thing Schussler likes to build into his restaurants, aside from shock and awe? Retail.
“Don’t create any restaurants that don’t have a retail store because people want to buy a piece of their experience,” he added. “I design places so that, when people walk in, retail is on the right. It’s the first thing they see, and the last thing they see when they leave. Almost everyone leaves with a souvenir. It added so much money to the bottom line, and the margins are much better than in food and beverage.”
Luncheon keynote Michael Beneville, CEO of Beneville Studios and founding partner of Area 15 in Las Vegas, understood this concept well. On its own, an item is just an item. But what happens when that item is part of something bigger? It becomes a living memory. An experience you can hold in your hand.
“If you give an experience, people will buy,” he said. “If you just start by buying, there’s no context. It doesn’t mean anything. People need the narrative of why it means something.”
Behind the Brands panelist Brian Birckbichler, president and COO of JumpShot, noted this strategy could be applied to any offering with a price tag. Even a pizza.
“We all have flatbread pizza,” he explained. “That’s not really exciting. But if you can attach a story to it, it makes it exciting. I challenge you to find something people are more emotional about than food. It’s really intended to create an emotional response.”
Investment Diversification
Providing what’s new and novel, or what’s shocking and awe-inspiring, are certainly ways to get people out of their homes and into some real-life “entertainment” — however that may be defined.
Entertainment doesn’t always have to be about who has the biggest elephant (spoiler alert: Rainforest Café does), but who can offer the most to guests. Diversifying one’s offerings not only provides opportunities to capture more of a guest’s dollars, but a larger pool of guests.
Leading Retail Landlords panelist Winston Fisher, CEO of Area 15, noted that his immersive space aims to capture three types of audiences.
“Daytime, evening and nighttime audiences,” he said. “How do you curate to three different groups? You track a tremendous amount of data. Then you use that data and some creativity to form a diversified, entertaining, storytelling platform. And the bigger you get, the easier it is.”
Diversification is a strategy that many movie theaters have embraced as they continue their evolution.
Mike Bowers, president and CEO of Harkins Theatres and an Additional Entertainment Offerings in Movie Theaters panelist, noted redemption (ticket-based) games are performing very well in his concepts, as are alternative events like bingo.
Fellow panelist Chris Drazba, chief development officer of Alamo Drafthouse Cinema, said he viewed today’s movie theaters as not simple cinemas, but as community hubs.
“I see us as a community center that supports the community we serve, so our content is for a specific audience,” he added.
That “content” includes lobbies and bars that are designed with hyper-localized themes. Naturally, it includes what’s shown on the screens as well. Today, that may include the standard blockbusters, as well as popular independent and foreign films and even sports.
“It’s a bigger part of how can cinemas take advantage of the future?” Drazba said. “We are movie houses, but we can’t always depend on that. So, how else can I continue to bring traffic into a building, and maintain traffic throughout that building?”
Maintaining that traffic is a key component to achieving ROI, Fisher believes. One-off sales are great, but building that long-term relationship with the customer — where they think of your destination when it comes to fulfilling a need — is what really matters.
“The true holy grail is tradition, which is repeatability,” he said. “You want to create something that resonates and connects with consumers.”
And, above all else, you want to achieve the key to any long-term relationship: an emotional connection.
“A great space isn’t an end product,” Beneville said. “It’s the beginning of a great experience. People should leave with something emotional. At the end of the day, we’re in the ‘people-moving’ business. In order to move the people, you have to move the people.”
— Randall Shearin