This essay is not going to be about how to take comprehensive steps to help retail establishments address an impending crisis that not only threatens a range of brands and real estate concerns with bankruptcy, but the viability of the entire economy. Retail Therapy by Mark Pilkington provides a powerful exploration of such concerns and is an advisable resource for anyone who is interested in addressing the underlying challenges facing retail. This essay will instead look at how the crisis facing retail is playing out urbanistically, in terms of design, and spatially. This will involve exploring the historic position within the city, the power that product, display, and store design has had to drive interest from consumers, and the recent trends leading up to the current crisis. With this understanding in hand, we will then be able to begin to ask how design and city planning can contribute to a broader revitalization of retail. This will allow us to go beyond asking how retail can be revitalized to asking how we can deal with the tremendous vacancies and threat to real estate value that a shift to online sales implies. In the end, we hope to offer a set of scenarios for how traditional retail space on main streets and in malls might be used that extends from historic habits, while also being grounded in future trends of how we live and consume as well as our broader desire and goals for ourselves, local community, country, and world.
The ephemerality of retail continued after the decline of the Roman Empire in cities around Europe – many of which were founded during the Roman era and evolved from that initial platform of central squares that could be converted into marketplaces. At the same time, Guilds began to rise during the Middle Ages and became a means of organizing production, codifying and passing along knowledge, and centralizing wealth that could be used for broader investment in physical space. The various guilds organized a range of workshops that increased the capacity to produce goods. While often shipped directly to the homes of the aristocracy, they also began to be sold directly from shops. When visited, these shops were often not places to actually pick-up a new dress, but a place to view the craftsmanship and have one’s measurements taken before ultimately waiting for the product to be created before being brought to the customer’s home. In this sense, the landscape of Medieval retail was a direct-to-consumer, manufactured on demand, non-branded production, and a craftsmanship driven approach not all that dissimilar from the current state.
The rise of global trade during the 12th Century onward began to introduce intermediaries into the process. Silks, dies, and fabrics were imported from the Far East to Europe, bankers began financing such expeditions, and guilds began serving as centralized buyers for a collection of craftsman. At the same time, exporting beyond one’s immediate locale became possible as countries in Europe developed a reputation for being exceptionally skilled in the production of a certain good. This rise of global mercantile commerce led to tremendous wealth that in turn furthered the demand for goods to be consumed. It also led to the radical transformation of the shape of the city – particularly the Renaissance Italian City. The Palazzo typology was introduced in the late 15th Century as a strictly domestic building, but evolved to include retail on the ground floor. These spaces were often shops facing the street with a mezzanine in which the owner and his family could live. Above, on the Piano Nobile, the primary living quarters of the noble family would be located. The interior of the courtyard would be treated as a semi-public space through which people could pass as they moved through the city. In some cases, the retail shops might be aligned with the business interests of the owner of the palazzo – such as when they derived their wealth from being a merchant.
The origins of the current state can be seen in the consolidation of the retail experience in the arcades of France, Germany, and Northern Italy during the mid-19th Century. These spaces removed shops from crowded streets shared with horses and carts and unruly markets crowded with dense vendors. They offered a space in which the customer could stroll with a sense of leisure and browse the various goods being offered. Their creation coincided with the rise of the petite bourgeoisie as well as the Industrial Revolution and the capacity to mass produce goods. They also represented a rather unique real estate proposition by cutting a path through different owner’s parcels – giving each an ownership stake in the arcade as a result or paying them directly as means of compensation. At the same time, urbanists such as Hausman were planning ways of alleviating the crowding of the Medieval City through vast new boulevards that could accommodate gracious stores. With this vision of urban rejuvenation and the capacity to think about re-planning entire blocks came the idea of devoting large blocks entirely to retail.
The department stores that would rise to or perhaps be a leading protagonist off – coupled with the railroads – the grand urban vision of the mid-19th Century found their origin in dry goods and hardware stores of the late 18th and early 19th Century. By the 1850s, many of these stores evolved into large concerns selling diverse goods manufactured locally and overseas. While the arcade carved a compelling path through the dense urban fabric, the department store was fundamentally an object sitting within an urban context defined by blocks. The typology was further defined by the capacity to create large display windows through advances in the structural system of the building via wrought iron and mass-manufacturing of large glazing panels. Having closed off the street to views of the street, light was brought into the interior through large glass ceilings that echoed those experienced at the Crystal Palace in Hyde Park, London in 1851. These spaces offered unprecedented access to a range of goods and a luxurious shopping experience in one of the most innovative and new spaces within the city. The result was proliferation and fierce competition as independent department stores blossomed in each of the major markets in Europe and the United States.
Access to the department store was, of course, predicated on living nearby and having sufficient capital and social standing to be able to shop there. The mail order catalogue was a major innovation that brought goods to remote parts of the United States and world. By revising the supply chain and extending to all sections of one’s life and even by selling homes that could be shipped and built on site, the Sears Roebuck Company was able to grow rapidly and become one of the preeminent retailers in the United States and globally. They were the ultimate middle man with a minimal requirement for any physical presence. Moreover, they were a company that, as a result of the mail order nature of their business, could serve a racially diverse and rural set of communities – thereby playing a significant role in the acculturation and assimilation of diverse groups under the umbrella of American consumerism.
While all of this was occurring, main streets and retail corridors were also thriving. Their success was propelled by waves of new immigrants coming from Europe as well as a burgeoning industrial economy that propelled growth of dense cities. The architectural typology associated with these streets is not all that dissimilar from the shop with an apartment above that arose during the Renaissance in Italy. While the Palazzi of the merchant princes have been displaced to upscale neighborhoods and the service courtyard has become an alley, the idea remains largely the same even if a dozen or more apartments are stacked on top of the storefront. The density, however, has a great deal of impact on the success of the retail as does the connectivity to other parts of the city via public transportation. Many thriving retail streets in American cities were supported by public transportation – streetcars in particular – that were removed during the 1950s when lobbyists for the oil and gas, rubber, and auto industries convinced lawmakers that streetcars were dangerous and outdated. Streets became increasingly congested by cars amidst a broader trend towards leaving the city in favor of the suburbs.
The shopping malls that would come to serve these new suburbs combined the leisurely stroll through an arcade, the glass covered experience of the interior of a department store, the anchor tenants of department stores, and the smaller boutiques that one might find on a main street. These spaces also combined movie theaters, restaurants, daycare, and cultural events. As entities serving new communities that grew incredibly rapidly – in many cases from scratch. Malls became the primary public spaces for these communities where people socialized and had fun. They were accessed largely by cars and were, for the most part, designed to cater to the middle and upper middle class. The result were tremendously profitable real estate and retail endeavors that thrived for half a century – even spreading back to the urban centers that were once exclusively dominated by freestanding department stores.
The current moment in the evolution of the retail experience is dominated by a shift to e-commerce and the benefits and drawbacks that it brings to retailers and customers alike. These include the following: disintermediation that reduces the number of parties between production and consumption – thus reducing the overall cost of the product; access to a larger inventory and elimination of need to stock products in stores; shift from advertising and promoting established brands by retailers to producers marketing and selling directly to consumers; a reliance on data and predictability to drive sales; a use of digital tools to enhance the sales experience; and the ability to make the physical retail space more devoted to experiencing the product and brand rather than sifting through different brands and trying things on. The result of these trends has been to put considerable pressure on traditional retailers and call into question the viability of the architectural typologies they rely on. Such pressure can be seen repeatedly in the history of the typologies we looked at in Part I as consumer tastes shift. It was a condition that Walter Benjamin lamented in the 1920s as he walked through the decaying arcades of Paris that had gone out of style amidst the continued rise of the department store.
Looking back, we can see how one typology gradually led to the next. At the moment, a new typology associated with e-commerce has yet to emerge. While we might say that the data center and automated warehouse fulfilling online orders are just such a typology, a customer-facing typology has yet to fully emerge. Seeds of this new typology – perhaps one that won’t ever be as centralized and unified as those of the past – are beginning to take shape. We can see it in local distribution and drop-off centers, smart locks with timed entry codes that make it possible to drop off packages inside homes, service corridors specifically for deliveries, drone launching pads, and stores that are driven by experiencing the product and brand before ordering it so that it arrives later. We are seeing seeds of a new typology in smart retail that allows customers to talk with a virtual salesperson who already knows their preferences and has their payment info. It is found in stores removing cashiers via RFID tagged merchandise and those that focus on events, gathering, and displaying the brand history over promoting the latest product to be consumed.
If we were to combine these seeds with some of the characteristics that have defined each of the major retail typologies, we might arrive at a retail typology for the digital age that looks like the following: it would draw on the ephemerality of early markets and the current trend of pop-up retail pavilions that create unique experiences around events; it would draw on the guilds and shops of the Late Middle Ages to allow customers to experience and consume the craftsmanship rather than consume the product as a manufactured image that often obfuscates the quality of the product; it would draw on the Renaissance Palazzo and break down the distinction between different typologies in order to create a strong integration between different aspects of our life and higher density of traffic – particularly between retail, residential, recreation, work, healthcare, culture, and education – while also drawing on the capacity to grow and produce products locally; it would draw on the interiority of the arcade and department store and create a space outside of the every day where unique events can occur; it would also be a place with access to a huge range of products and connected to remote locations; finally, it would draw on urban retail corridors and be situated in a dense setting with great public transportation.
What form would this typology take and should it be sited in the existing locations of retails? Should it exist as a new retail concept that is inserted into vacant storefronts and malls? Or, should these be left aside in favor of building entirely new ground up structures appropriate to e-commerce? In the current context of a mandate for increased sustainability, recycling, and limited resources, it is worth considering how the vast amount of retail space that currently exists can be retrofitted rather than rebuilt. This is particularly important because quite a bit is tied to other typologies such as apartment buildings and is also already embedded within the urban fabric of cities and towns. In doing so, however, we should see these spaces as a blank slate that can be occupied in a range of manners in much the same way that one might occupy a stoa or basilica. In the process, a more radical approach to occupation might be explored that breaks through conventional structural systems or imposes unimagined stylistic, spatial, or programmatic interventions.
If a new typology associated with the future of retail as driven by e-commerce is to emerge, it will likely build off of the existing dominant typologies while also offering a spatial experience that is decidedly unique. With this in mind, we can see this typology as a blend of the existing backdrop and a kit of parts that are inserted within the frame of the existing backdrop. Unlike a stoa, this kit of parts would be situated within the center of existing retail, creating an interior platform from which one could look out. The kit itself would include wall-size digital screens, seating clusters, bars, kitchens, fitting pods, pick-up boxes, private rooms that can be programmed in various manners, short-term sleeping rooms, long-term micro apartments, and fitness and wellness modules These diverse modular units would be linked by digital screens creating stylistic and narrative unity. They would all be supported by flexible infrastructure and connected by paths leading from different clusters defining different points of focus, concepts, and zones.
This kit of parts would be used to essentially create a new version of a department store that offers guests a curated experience of products in a space in which they can relax with friends, work, grab a coffee, have a glass of wine, watch a movie, take a class, discover new products, and make purchases. In essence, we propose creating a social space that is in use and filled with products that can be scanned, added to a wish list, and purchased. Unlike a department store, this space would not be divided into different booths in which particular brands display products and compete with customers for attention and sales. Instead, the products would be mixed in a way that mimics how they might be used once sold. At the same time, products could be displayed in ways that allow customers to compare products as they might do online.
The space could be offered to guests in tiers. The general public might gain one level of access, prime customers another level, and elite another level. Space for vendor products could also be offered on a tiered level. Established brands could be give one type of space while emerging and local brands could be given another type of space. One-off products might get another type of space. Both established and emerging brands could pay for this space to highlight new products. Pricing could be commensurate with sales in order to keep space affordable for emerging brands.
The space could be further activated by programming that aligns with the curated products. This might involve readings by authors or designers that are being featured, exhibitions by artists or product makers releasing a book or product, and even temporary and permanent workshops where some of the products are being made that serve as a compelling point of interest and selling point for guests. The goal would be to expose a broader customer base to new products, create a dynamic space in which people can gather, and, perhaps most importantly, to help revitalize sections of main street that have suffered as a result of a shift to on-line retailing.
As this occurs, we might begin to think beyond the notion of attempts to “save retail and retail space” to consider how to “save” how we dwell in the city. In this sense, we might consider how this kit of parts could begin to address affordable housing through co-living models that might create housing options in close proximity to retail jobs that people might hold. It would see this new typology as something more than a third space between home and work and more as an agglomeration, mixing, and blurring of the different programs of the past for those interested in living and working in this manner. For others – perhaps those employed in professional services – this space might be a place that one visits occasionally. It could take advantage of the digital supply chain and offer spaces where people could experience products that they select during the week while browsing online in order to give them a chance to try on multiple sizes or gauge the quality of a product. This could create a shopping experience that is akin to having a personal shopper.
This sort of approach would naturally change the entire architecture of the retail experience both as a result of how inventory is stored and presented and by breaking down the boundaries between brands, letting the customer decide the inventory so to speak, and breaking down boundaries between programs. It would create spaces that are an extension of the brands that are constructed to appeal to and motivate customers through mission, quality, and genuine innovation. This store would be a physicalization of the narrative that propels the brand – essentially a set from a movie into which one could walk and participate. In essence, it would be a space that was activated through virtual engagement – in this case, primarily the collection of retail products. This would not have to be limited to – and would actually be enhanced by – allowing broader social communities to activate these spaces. In this sense, people might be encourage to plan birthday parties, get togethers, and nights out within these retail environments. Through digital interfaces, users could even request how these spaces would be modified. Retailers, in turn, could fill these spaces with products that might contribute to how people want to use the space.
If we imagine this fluid, dynamic, evolving, and ephemeral typology taking hold within the vast amount of retail space that is currently available, we should consider the specific types of spaces that are available as well as how such physical spaces will connect to a broader retail infrastructure that includes warehouses, cargo carriers, drones, landing pads, pick-up centers, mailrooms, and mailboxes. This infrastructure would then be connected to the existing collection of retail spaces along main road corridors in cities, in central business districts, in clusters of trendy shops, in suburban and rural main streets, in department stores, and in urban and suburban shopping malls.
There are essentially four options for implementing the strategy that we have described:
1) Work within existing spaces that might be conducive to such a strategy including malls and large big box spaces;
2) Work within discrete spaces and essentially distribute the experience across the city;
3) Combine discrete spaces in ideal urban locations into single spaces;
4) Build new ground up structures that are ideally suited to this program and connected to broader urban planning endeavors.
The first and second strategies would, in many ways, be the most straightforward given that they could draw upon existing distribution and customer access infrastructure. These spaces have all the requisite infrastructure that would allow them to be quickly set up and transformed based on evolving configurations of the kit of parts that we have described. At the same time, they are large enough and sufficiently distributed such that they could accommodate diverse programs that could be segregated in order to achieve ideal proximity and adjacency of different programs. On the other hand, these spaces may not be in the ideal location with a city and may suffer from a lack of cultural appeal.
If we were to pursue the second strategy, it would necessitate linking the spaces through a common app that could provide unity to the range of storefronts. As we will see, introducing such an app to link digital and physical space will be essential to all approaches to the future of retail. Such a strategy would allow for decentralization that might connect the consumer experience to a wider range of people closer to where they live. At the same time, fragmenting the retail experience across small spaces throughout the city might limit the effect of the curated experience and capacity to enjoy adjacent programs as part of a retail experience that is highly integrated with the way that one lives life rather than presented as a separate activity.
While the third approach would help us to achieve an expanded, fluid, and flexible experience of a range of products connected to a range of programs, we would have to explore ways of connecting these spaces across owners and buildings. Although radical, precedent for this idea exists in the creation of the arcades in the 19th century. While it may seem somewhat counterintuitive to take small vacant spaces that small retails aren’t able to fill and combine them into much larger and more expensive spaces, doing so will create a platform for an immersive experience that can accommodate larger programs more akin to how we live generally than how we shop specifically. It will also create a large, open, and inviting space powered by shared resources.
This strategy would ultimately seek to remove the discrete isolated retail units from the ground floor and create an open plane that can be flexibly programmed. The line between the inside and outside might be conceived in a fluid and flexible manner – seamlessly blending indoor and outdoor retail experiences. This strategy would not preclude discrete pavilions within the broader experience, but would see them sited as freestanding modular units conveying a particular brand identity within the broader retail landscape. It would, however, create a far greater continuity between every-day experience and purchasing items that one might use to enhance that experience. This strategy of creating continuity could also be applied to suburban main streets.
As we have mentioned before, the fourth strategy is somewhat less desirable as it would not allow for the reuse of existing structures and would contribute additional square feet of retail real estate to a landscape that is already struggling to fill such spaces. At the same time, ground up construction would create the opportunity to execute designs that fully showcase the capacity of the kit of parts that we have described as a result of how the structure is designed, the depth of the floor plate, the height of the floors, the mechanical and support systems, the specific façade system, acoustic isolation, and circulation. In the process, considerable time and money might be saved that would help enhance the overall profitability of such an endeavor.
In all likelihood, the ideal path forward would include each of the four strategies in order to develop a new retail network unified by a centralized app designed as a means of linking digital and physical space around curated experiences that give meaning to and unify objects, goods, and services that are for sale. This proposal rests on enhancing physical space with digital tools while also blurring the lines between spaces devoted to discrete brands through an immersive shopping experience akin to what one might get online while also allowing for discrete brands to be showcased as exceptional within this experience. Again, akin to shopping online, this new retail experience makes room for doing other things that one might do at home or work while shopping.
The financial challenge of this proposal lies in that it requires the operation of a physical space. This is, of course, also the financial opportunity in that it can support current real estate owners, requires people to outfit, reconfigure, and manage the space, has the capacity to include new programs such as co-working, entertainment, and housing, could address affordable housing for retail workers, and has the ability to introduce people to new brands through interaction with brand ambassadors and influencers. In this sense, the proposal would only be viable if it cost the same or less to buy products in the physical space as online. It would have to avoid re-introducing mediation of something like a department store that charges a significant markup.
The first strategy would be to build on or extend the benefits of a service like Amazon Prime. Membership could be separated into different levels providing access to different types of space. Special rooms or areas for specific programs could be rented by the hour as add-ons. Areas for longer stays could also be included. On the flip side, service providers requiring spaces such as bars, restaurants, or discrete retail pavilions could be charged rent. On the product side, products selected by members to try on in person would be included free of charge while competitors could pay a small premium to have their products included as an option. These fees would essentially be used to support an app whereby customers can make, organize, and program space as well as the fabrication of the kit of parts and the crew configuring and staffing the space. The manufacturing of products, a portal to find products, and the distribution network that gets them into the space would all remain from the current e-commerce model.
For such a proposal to work, a new type of cooperation to attract customers and compete with an online only experience would have to come into existence. An operator of the space would have to build trust with the public and deliver an exceptional user experience. Further, considerable investment would be required to develop the kit of parts to support this experience. As such, it would be important to be able to scale the kit and lock up considerable market share locally and throughout the country. For this to be possible, it would be important to develop a company to rent, build-out, and manage this new retail landscape. The company would ideally be a joint venture between a department store, online retail marketplace, medium-end retailer, and a luxury house. Ideally, it would also have backing from a venture capital firm that could help the concept to scale very quickly should the initial concept prove successful.
With this in mind, the first step would be to identify an ideal location for a pilot project and, at the same time, design and build a prototype in a warehouse where different demographics could test the concept. If successful, leases could be negotiated in various markets before the debut takes place so that the modular kit of parts could be quickly deployed, the public clearly aligned with the brand of this platform, and a high barrier of entry created for other competitors – thus delivering a strong return on investment for all those who initially contributed capital.
In order to achieve this goal, investment would have to be made in the following:
1) Kit of parts as retail platform (with a return on investment being derived from rent and membership in the new retail platform).
2) An app to bridge the gap between digital and physical space, engage products, and make requests for how that space appears and the products that exist there (with a return on investment being derived from advertising on the app as well as membership).
3) Design of the space beyond the kit of parts (with return on investment derived from the above).
4) Operations of the space (with return on investment derived from the above).
These areas of investment and routes of return on investment are all supported by the more traditional revenue streams such as selling products and taking a commission, introducing new products and earning revenue through money spent on marketing them, and selling access to and goods associated with adjacent experiences such as dining, drinking, art, sports, and entertainment. Revenue associated with this latter category might be generated via rent, tickets, and commission on products sold. To a certain extent, such a strategy would imply introducing a third party to decouple merchandise and supply chain from designing and managing physical and online space in order to ultimately create an enhanced and more unified retail space that cuts across brands – and perhaps challenges the unified space that Amazon has created in the process.
Creating such a new form of intermediation would consolidate a number of other intermediaries. Achieving such a vision could be visualized by taking a highly designed space such as a high-end restaurant or private residence and simply creating an app that would record and present sources and details of objects in that space via augmented reality powered either by RFID or visual recognition. The next step would simply be filling this platform proactively outside an existing project and connecting it to the broader kit of parts that we have described.
In summary, we envision opening a common space in which we can be together that is not just a restaurant or bar, but more akin to a living room that can accommodate a large number of people who are increasingly subject to private residences whose size is decreasing and whose cost is rising. We see such a space and the app that powers it as a platform for living. Such a space has all the goods and services that one might desire. Moreover, it has the capacity to link those goods to one’s workplace, home, storage unit, or even secondary market. Ideally, the result would be a more connected and active relationship to the best products and services being generated by a new generation of retailers and service providers that aim to reduce waste, enhance efficiency, and deliver a more profound retail experience.