Tenants are continuing to adjust to the new consumer spending landscape, which was underscored on the recent Q2 earnings call by Fortune REIT. The report sheds light on what’s happening behind the scenes as retailers adapt their strategies to a new economic reality and changing customer expectations.
Additionally, the report finds that the growth of e-commerce has caused legacy retailers—aka traditional brick-and-mortar stores—to adapt and experiment with their business models. Retailers are accelerating their omnichannel strategy. They’re looking to boost their ambassador program and deliver a more unified shopping journey that combines in-person and online experiences. This transformation includes keeping pace with innovation to stay competitive, but to address the needs and expectations of a highly-demanding consumer base that is accustomed to tech innovation.
Furthermore, the report notes that consumer behavior has changed dramatically in recent years, with an increasing focus on experiential retail. Today’s shoppers want an experience that they are not going to find online. This transformation is pushing retailers to create immersive spaces that attract customers and foot traffic. This trend has led to the pop-up store phenomenon. It’s these dynamic, memorable installations that make for the most impactful encounters that connect on a personal level with customers.
Furthermore, Fortune REIT’s results show that sustainability is increasingly important to consumers’ values. Retailers are rising to the challenge by going green, from addressing excessive packaging waste to focusing on sustainable materials. This commitment goes hand in hand with consumer values and further allows brands to stand out in a saturated market.
The economic environment in Hong Kong has been another major factor in developing retail strategy. Fueled by the recovering pandemic economy, retailers of all sizes are nervously hopeful for a positive growth future. Most importantly, they continue to be watchful and nimble Uncle Scrooge types, making sure they stand ready to address the next unpredictable downturn in consumer expenditure.
In addition to their overall strategies to adapt, most retailers are pouring significant amounts of money into technology as a means to drive operational efficiency. This means adopting sophisticated inventory management systems and using data analytics to anticipate or even influence consumer tastes and preferences. By leveraging technology, they plan to be more efficient with their operations and provide a better experience to customers.