Anjee shares insights from Colliers’ consumer studies. She also notes the importance of integrating online and offline shopping experiences in order to cater to modern consumer preferences.
Anjee shares insights from Colliers’ consumer studies. She describes the shift from traditional shopping habits to a more digital and socially driven approach, and notes the importance of integrating online and offline shopping experiences in order to cater to modern consumer preferences.
Welcome to Elevating Brick and Mortar. A podcast about how operations and facilities drive brand performance.
On today’s episode, we talk with Anjee Solanki, Head of US Retail at Colliers. Colliers is a leading diversified professional services and investment management company. Colliers maximizes the potential of property and real assets to accelerate the success of clients, investors and people.
GUEST BIO
In Anjee’s current role, as National Director, Retail Services and Practice Groups for the U.S., she provides strategic leadership to more than 500 retail professionals nationally, covering investment sales, agency, retailer representation, and asset repositioning advisory services.
Anjee Solanki brings 30 years of focused retail estate experience, and world-class expertise regarding everything retail to Colliers International. She provides strategic retail advisory services to enhance value for her clients with her expertise in lifestyle, community, power center, neighborhood, mixed-use retail/residential, and resort retail.
Her strategy identifies current market and property inefficiencies to capture untapped value through asset repositioning, releasing, redevelopment, rehabilitation, proactive management, and enhanced marketing.
Creative problem-solving is her specialty, and she becomes a key stakeholder with national and international retailers, such as JPMC, Opry City Stage/Ole Red and Tim Hortons, and many others. Her highly focused approach reduces the risk profile and provides clients with a thoughtful approach executing strategic multi-year planning initiatives.
TIMESTAMPS
**(01:00) – All about Colliers
**(03:28) – Anjee’s retail outlook
**(07:43) – Online vs. Offline shopping
**(14:56) – The space supply issue
**(19:25) – Physical space creates trust
**(32:16) – Future thinking
**(39:55) – Big growth strategies
**(45:37) – Where to find Anjee
**(45:37) – Sid’s final thoughts
SPONSOR
ServiceChannel brings you peace of mind through peak facilities performance.
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ServiceChannel partners with more than 500 leading brands globally to provide visibility across operations, the flexibility to grow and adapt to consumer expectations, and accelerated performance from their asset fleet and service providers.
LINKS
[00:00:00] Welcome to elevating brick and mortar, a podcast about how operations and facilities drive brand performance. On today's episode, we talk with Anjee Solanki, head of Us Retail at Colliers. Anjee talks about the resilience of retail and how physical environments are the best way to engage with your consumers, whether or not you benefit from online sales. Now here's your host industry and FM technology thought leader, and Chief Business Development officer at Service Channel, Sid Shetty, along with our guests and Anjee Solanki.
[00:00:31] Sid Shetty: Hello everyone. Welcome to Elevating Brick and Mortar. My name is Sid Shetty, your host, and I'm here today with Anjee Solanki, Head of US Retail at Collier's. Angie, welcome. Thank you for being here.
[00:00:43] Anjee Solanki: Thank you, Sid. I'm excited to be here and share kind of our thoughts all around retail.
[00:00:49] Sid Shetty: So Angie, for folks in our audience who might not be familiar with your company, can you share some insight into Colliers and who you are and what you do?
[00:00:59] Anjee Solanki: A hundred percent. So Colliers is a global company. Uh, we are across many countries specializing in industrial, office, retail, healthcare, and specializing in other specializations or business lines and practice groups. So very well versed and, uh, you know, We're here to help our clients and advise on what's going on in the different markets.
[00:01:24] Sid Shetty: I want to dig in more into Collier's, but before we do that, I'd love to hear about you and your journey and probably let's start with, uh, you know, your role, you know, as head of retail, like what does that mean and what are you responsible for and how did you, you know, come into that role?
[00:01:41] Anjee Solanki: Yeah, it's a great question. Um, a lot of people ask me that question, especially on the family side, uh, cause they go, what do you actually do? I started in this business 30, 34 years ago, so specifically in retail. Um, and the reason why is because I have a passion for that creative side, uh, with a little layer of structure. So getting my finance degree, I decided on, you know, what's going to still give me that, you know, true entrepreneurship, uh, growing, uh, you know, growing up in a family where I had a very business minded mom and a very structured father who, um, you know, just was looking at kind of, here we are first, first generation in the U S.
[00:02:24] You know, what are we going to do with our family and what's our lifestyle going to be? Uh, so I was very fortunate to have two very strong willed, uh, parents that groomed me to who I am today. And I have to say, you know, retail has just been such a, uh, an exciting industry because it never changes. It's always evolving.
[00:02:43] And I think because of that, um, it's allowed me to tap into that creative side. Um, so for me, you know, I look at retail very holistically. So I'm looking at it from all the different layers of, of that retail asset in terms of its life cycle. So whether it's an asset, a physical asset that is evolving over time, or it's a retailer that's also evolving because consumers have changed how they're shopping, those two live harmoniously together. And because of that, it allows us to really. Do a deep dive and answer a lot of questions or find solutions to different pain points.
[00:03:25] Sid Shetty: I love that. Thank you for sharing your journey with us. You know, so you have worked with a lot of professionals in the retail space considering you spent 34 years there, right? Uh, how has that informed your outlook on retail, especially since you also do your own independent research and you're looking at the data holistically?
[00:03:45] Anjee Solanki: You know, it's been really interesting. If we go back 15 years, there were a handful of retailers that were hyper focused on investing a significant amount of capital in data. And data analytics. They had one piece of information, which was the POS data, which they could see where customers were coming from, but how to harvest that, you know, um, and not have it sit in silos was really critical.
[00:04:11] We fast forward to where we are today. We have a lot of data. Now it's too much. Information, right? And so how do you identify how to translate that data is really critical to where we are today. And that's both on the landlord side or the investor side. In addition to the retailer side, but there's one common theme and that one common theme in terms of where we are in our industry. And I'll, I'll spend a little time here in a moment talking about, where we are from a statistical perspective, but there's one common theme and that is the consumer and that consumer journey has really changed. If you stop and think about the consumer from the past, um, and when I think about the consumer from the past, I'm thinking about, you know, they were very hyper focused on, um, limited online research.
[00:05:02] Uh, go into store, browse, shop, uh, consider, you know, a second item potentially. And then, you know, looking at commercials on TV. Now I don't know about you, everybody streams, um, cable was the past and streaming is the future. So our ad lifestyle has changed. If we look at our consumer today. They've adopted social media, so they're looking at, you know, uh, products on Pinterest or TikTok or other, um, they are looking for a seamless shopping experience so they can buy on their iPhone or any device, I should say, um, and then pick up in store or, uh, vice versa.
[00:05:47] They're leveraging the data to do their own personal comparison, um, and looking at where they can find a better deal and gamifying it for themselves. Um, and they're also prioritizing other components like sustainability. Is that brand sustainable? Is that brand offering something that's much more sustainable?
[00:06:08] Uh, so I'm going to leave you with that because. You may think, well, my goodness, Angie, you just talked all about, you know, this online shopping, is it going to take over brick and mortar? And as you're, Service channel states elevating brick and mortar is truly where we are today. And it's never been, I guess, it hasn't disappeared.
[00:06:31] Let's just say, say that, right. Um, as you know, brick and mortar is definitely here to stay. It represents, you know, 85%, 80 to 85 percent of our, uh, sales. Globally, and predominantly here in the U. S., it's a very high number of people like to go into stores. It's a social event. It's an educational event. It's an experience. So, I don't see that going away by any means.
[00:06:59] Sid Shetty: so when you look at, you know, this notion of the physical brick and mortar space and the impact that it has had, uh, from e commerce, there's clearly, a convergence here, right? There has to be. Um, and I think what it has allowed retailers to do is understand how their consumer is interacting, um, with online shopping experiences to inform how they, um, maybe purchase. Uh, goods within the physical space. What, what are your thoughts on that? Like, how are those two intertwined and how is it impacting the, the consumer and the retailer.
[00:07:43] Anjee Solanki: From the retailer's perspective, um, online and offline are definitely now one. So there's no more blurring of the lines. There's no more, we must be integrated. I think that's occurred now for the majority of retailers that, that understand those two spaces quite well. So, for example, those that were predominantly online have shifted to identifying more stores for the reasons you just described, because when you can get a consumer inside your space, you can do a couple of things. A, you have their locked attention, and you have the ability to share new products, uh, new things that are going to be released here shortly. You can also share how they can become a loyalty consumer by giving them rewards, et cetera. So there's that aspect. Retailers that have a strong offline presence or brick and mortar presence and, um, have developed a strong online has seen the synergy there as well. They've been able to say, okay, we have a product that we know, typically we need to educate because this product A is, you know, I wouldn't, is a mid tier price point. So it's not an everyday you're going to go and spend, you know, five to 10. It's a couple hundred dollars. But, you have the ability to buy the accessories to that product online because it's convenient.
[00:09:02] So having the balance of the two, in my opinion, from what we've seen and talked to different retailers, is so critical and you just can't have one or the other. They definitely need to be, uh, you know, a, a, um, a seamless, uh, connection between the two. And they've seen it, I mean, retailers have shared with me the minute they've opened a brick and mortar, if they were an online store and they opened a brick and mortar in a market where they'd have a high online sales presence, they've actually seen sales increase, um, when they open a brick and mortar, because the, yeah, the consumer walks in, they're like, Hey, it's great. You have this store. I can actually now ask you questions. Who wants to talk to a chatbot all the time? I know I don't.
[00:09:46] Sid Shetty: From what I understand, like, Colliers is ready to release the spring retail report, right, soon. Like, so you're, you're a big hand to play in that. Um, can you share some sneak peek, uh, data, or can you give us a sneak peek into some of the insights that you're seeing in that?
[00:10:03] Anjee Solanki: A hundred percent. So, um, our spring 2024 retail report will be launching here, um, in a few weeks. We're very excited. So we do put out on a pretty regular basis, on a quarterly basis, our reports. So this report is really speaking to what you just described is what are, what are the, you know, um, strategies for retailers to navigate in 2024 as we see price Increase and demand adjust.
[00:10:32] And there's a lot of, uh, demand adjustments because consumers are being mindful that we're starting to see cost increases. Um, you know, we already know the interest rates are slowly shifting down, but they haven't completely shifted down, right. Insurance costs are still high. Uh, both for home and auto, um, auto costs are still, so the consumers are trying to navigate through this budget cycle from their own personal budget, um, but yet they have to be conscientious.
[00:11:00] And so there's this, you know, price versus demand study that we did. And really what we're looking at is, you know, the economics of consumption, the conscious consumer and how they're spending, the transformation in the food service retail, as you probably heard, uh, California now has shifted wage price, so wages have increased, which has really changed how, um, you know, the food and beverage side of ownership has really shifted staffing, being, um, menu, efficiencies, digital demand, et cetera. And then from there, we really took a look at how are consumers, um, you know, where are they spending in terms of different categories and where have we seen foot traffic based on mobile data shift by category. It's a lot of good information.
[00:11:53] Sid Shetty: How does the retailer look at the consumer today in terms of, you know, Um, what they're buying, like, you know, has there been a shift in that?
[00:12:01] Anjee Solanki: Yeah, definitely. So if we look at it, there's definitely a, um, uh, a strong, Uh, differentiation between, uh, must have products as well as value oriented. And so consumers right now are hyper engaged in looking at, you know, um, really I would say those value oriented, those long term shelf items. So things that can sit on the shelf, whether it's, you know, food or, um, apparel, right? So something you're, you can have and wear that's going to be quality long lasting. They may pay a little bit of a premium if they know they can keep that garment for an extra two to three years. So the consumers are looking at call it shelf quote unquote shelf life. Um, so that's one. The other thing that we're seeing is, you know, uh, we're looking at the consumer focused on those essentials.
[00:13:03] So essentials are going to be in the grocery sector, the health and beauty sector. Again, not too much in clothing. That's no longer call it a high priority. I would say furniture is also a sector. That's not a high priority. At the moment. So they may pick up, you know, um, those little trinkets to put on the shelves to feel good.
[00:13:25] Like, Oh, I just bought something new and fresh for my home. And that could just be a beautiful vase, right. From, you know, a value oriented, um, brand that's 10. Um, and, but they make, it makes them feel good. And we're going to see that in the beauty sector too. So even though they're going in and they're going to say, well, I'm going to buy that, that, that, that.
[00:13:46] Pink lipstick or that eye shadow. They may not. But be buying that premium brand, they may be buying that next tier. So with that mindset from a consumer, a lot of our retailers are thinking about how do we create our own private label? Because when we create our own private label, just like Costco has, Whole Foods, et cetera, they then intend their margins in that, um, private label actually are quite higher and stronger. Which again, helps and supports all of the back end operational costs to maintain that store.
[00:14:25] Sid Shetty: And how are retailers looking at expansion as a whole? And I want to talk about the physical space itself, but as you look at the space as a whole, are retailers looking to add more locations as a whole or is Is it kind of stable right now?
[00:14:44] if there's only a finite amount of space available, are retailers all competing for the same kind of space? And does, how does that influence their overall strategy?
[00:14:56] Anjee Solanki: There is a supply issue. We've had a supply issue for quite a while, even though we are, you know, the U S per person, per square foot, the highest in terms of retail, um, we still have a supply issue and our population continues to grow. They just can't build fast enough, but there's also cost to build. So the capital, you know, it, you know, has to pencil, but, um, So, going back to your question as it relates to retailers and the demand to expand, they are definitely expanding. Um, there are definitely key categories that are expanding, food and grocery are at the top. Uh, roughly, you know, when we look at, you know, percentage of consumers spending more in certain categories. Over the, um, you know, past six months, uh, food and grocery has been at the top, uh, because those are essential categories.
[00:15:51] People need to eat, they need to shop, buy groceries, et cetera. Uh, so you're seeing a high spend there. So those are the sectors that we're seeing. And you, you, you read about it today, the Aldi's, the Lidl's, the Kroger's, um, you know, and they're, and they have different components. You know, Whole Foods just released that they have a new small scale, urban store concept. So you know, they have the ability to adjust quite quickly and they seem to be nimble from a, from a grocery perspective. QSRs. Same, same thing. They have the ability to be somewhat flexible, uh, without destroying their sales. Uh, but they, because they've had, they have two opportunities.
[00:16:36] One is, you know, they have the ability for people to come in and order, but they also have their on demand and delivery model as well. That, that, uh, is a, call it a, an additional sales channel for them for, for revenue.
[00:16:53] So when we're looking at, um, you know, these retailers and so what are their strategies for expansion? Look, we do a real deep data, uh, drive in terms of looking at all the different types of, uh, assets that are out there, um, from, uh, you know, outlet to mall to lifestyle to, you know, community, et cetera, and power centers and mixed use. But we really look at all of these and it really is dependent upon each brand. Every brand has a unique strategy and, um, you know, there's going to be certain fundamentals that are, are, you know, not as unique, but they're most brands that, you know, understanding the brand first and then understanding their consumer. And they're online and offline to then help them develop a brick and mortar strategy growth strategy going forward isn't all about growth it to your earlier point in the conversation. It's about optimization. So, right? It's so how do we become, um, fully optimized in today's world. Right sizing in markets where your square footage may not need to be your traditional square footage, maybe in certain markets. Maybe it's in urban markets, you could be slightly larger or smaller, right? Or in strong suburban markets, you may want to be slightly, again, larger or smaller. So we want to look at all these demand drivers. And, and based on those demand drivers comes certain data sets that we pull from different databases that we have relationships with to help kind of look at That, that full, um, you know, map to say, Hey, you may want to consider closing this location.
[00:18:42] You did that deal 15 years ago or 10 years ago, and, and, you know, the population has shifted, or there's been new growth, um, and new projects that have opened up in this area. So let's kind of understand that. So it does take time. It doesn't happen overnight, but we really stop and, and act as advisors. Um, so, you know, this isn't a, what I would say, a, a broker led strategy. It is a strategy developed and led by our strategy team.
[00:19:12] Sid Shetty: Got it. You know, from, from what I understand, like you also think there's a correlation between, uh, physical presence and trust, right? For the brands and for the consumer.
[00:19:25] Anjee Solanki: If a brand wants to see, uh, you know, continued growth and success in growth. They definitely need to have a brick and mortar component because you're going to capture uh, more, more, uh, foot traffic in what I call eyeballs to, to lure into the store to help educate that consumer on the brand. You got to remember when you go online and I don't know if you have, I get online fatigue very quickly, especially, and there's a stat out there that I read almost seven years ago that said, they'll, uh, close out a website if there's just too many things flashing up at them.
[00:20:06] it's too much. It's visually too much stimulus and information. They'll just, they'll just close it down. They will not even pay attention. The other thing I want to share with that is. You know, we did a small study on abandoned shopping carts, and this isn't physical shopping carts in the parking lot.
[00:20:25] These are abandoned shopping carts online, and when we look at, uh, the, I think it's close to 40, high 40 percent will abandon the online cart. Because when they get to that final step, they then see, well, my goodness, it's going to take two weeks to get this product to my house. I can't wait that long. Or, Oh my goodness, I have to pay 18 in shipping costs.
[00:20:56] And if I don't like the product and I return it, I have to pay another 18. Well, what your discounts you're offering me. Are not even close to, uh, recovering any of those costs. So, you know, there's a lot of hooks and a lot of things that, you know, people may get lured into getting you up to that point. But to hear that high percentage that, I mean, that's close to 50 percent of people saying, I'm not going to buy this item.
[00:21:25] Now, so two things you've done, you've taken them through this online journey that probably took 15 minutes out of their day, and then you took them through this journey for them to now be discouraged. A, you've lost their trust. B, it's going to be very difficult to get them to come back
[00:21:42] Sid Shetty: right.
[00:21:43] Anjee Solanki: to buy that product because they're immediately going to go, well, let me see if I can find it on Amazon or any other, um, you know, Shopify, um, where I can get the same product quickly. So you're, you're, you're going to lose the trust and you're going to lose that loyalty.
[00:22:01] Sid Shetty: Anjee, like if you look at the different generations right now that are actually shopping, right, everyone from the Gen Zs to baby boomers from, you know, do you have data on like which, you know, generation prefers what kind of channel to shop and how is that influencing how, you know, retailers and restaurants and convenience stores design their physical spaces?
[00:22:25] Gen Z's are really interesting because I didn't, I, I, I didn't realize this, but they're actually very social. One thing we do know about Zen, Gen Z's, excuse me, is that they, um, nearly 50%, um, from a survey that we did with our partners, global data responded that they actually prefer to shop in store versus online,
[00:22:48] Right.
[00:22:49] Anjee Solanki: And you would think, well, they're, they should be digitally first.
[00:22:54] You know, in terms of their generation, um, because they saw everything virtually, uh, et cetera, but no, they really, their preference is to go into the store to try things on, to ask questions about, you know, the, you know, as I mentioned, the sustainability of the, of the product, um, are there different styles, et cetera, et cetera.
[00:23:15] So they, they like that kind of interaction, but they also like to, Again, they want to see it on themselves and, and then what they end up doing is a lot of times they'll put it on and they'll, they'll, then they'll start to take photos and then they'll share it with their friends and get their advice on the items.
[00:23:31] So it's very fascinating. Um, and we were really surprised that, like I said. Nearly 50 percent of the, you know, Gen Z respondents say that they prefer that, you know, in store experience. So I don't see that shifting anytime soon.
[00:23:47] Sid Shetty: Yeah, that's fascinating. I mean, as you know, like a lot of our audience, um, is our folks that are in the physical built environment functions, right? So, you know, facilities, design, construction, um, energy management, and so on. When you think about like the physical space, If today's generation wants to be in the store, and they are looking for a better experience, what is that better experience?
[00:24:18] Because one of the things that we know in our space is that we don't necessarily do a good job about articulating the impact of the physical built environment to a brand.
[00:24:29] Anjee Solanki: I think it's a very important and critical, um, and I'll stress that it's critical. Uh, so as brands define who they are, where they're going, Um, it's critical that they all, it's aligned not only just in their messaging, their marketing, but also their, the experience that consumer has when they enter that store to your point. So think about it this way. If you go to, and I'm just using these as, as. References you go into a target nine Ten times out of ten kind of know when you enter you're gonna see certain things Where you're gonna walk in you got the cash wrap you got the Starbucks or any other? you know coffee purveyor you have the Pickup or return on right when you and then they have their They're, um, they're holiday or gifting, grab and go's, really inexpensive items, right?
[00:25:31] And then you move in and you enter, you know, clothing and beauty, and then you know electronics is way at the back, grocery's on the other side. You know their footprint. Now, for as a consumer going into Target, that benefits me because it benefits me for a couple of reasons. Target offers quite a bit. They have, um, you know, thousands of SKUs. I want convenience. I want to enter a store. I know what I want when I go into Target. Sometimes I find things that I was like, Oh, that's kind of cute. I'll just pick this up too. But my point is like, they've curated that store. So well that I can still be have my convenience of finding the product I'm looking for and then also be surprised by the product, I'm not looking for, and I think mastering that is, is an art.
[00:26:27] And so that's one category of retailer. You go into, um, a more, I would say a retailer that is very focused on, let's all just choose like an, um, a clothing. Um, or apparel retailer that is very focused on the quality of their brand, um, and educating that consumer, you know, that's a different message you're portraying, right?
[00:26:58] So you want to have very clean, you want to see the merchandising as you're walking outside of the store, right? From a brand perspective. So you want large windows, very well lit. You want to walk in and you want to see these displays where you have, you know, very clean lines, high ceilings, lots of light, natural and internally lit, but everything is, you know, almost like it's color coded.
[00:27:25] So again, It's drawing your eye to all the different elements when you're walking into the store.
[00:27:31] So you have to really think about the brand positioning. What is the brand trying to do? I mean, restoration hardware, hardware does a lovely job. Um, uh, when you look at their brand and how they position their stores and, you know, in speaking with their head of real estate, I mean, it was amazing to hear, he said, Angie, when you go in next time, I want you to look closely and see if you see something unique. And so, you know, I said, well, you You know, show up. So I want to make sure I get it right. And, and so I went to the location where he, close to his office and he goes, do you see it? And I said, Oh my goodness, I didn't realize it. You have the identical, um, you know, the, the, their large, like beautiful, um, couches that they have or sofas that they have, right.
[00:28:21] They, they have them. Where they're identical, uh, facing one another. So the person who has, who's, who needs a sofa, that's either a left or a right, you know, positioned, um, with the arms and everything. I apologize. I'm not a, I don't, um, their product is too big for my house, but, um, but if you go and you go into their store next time, Sid, take a look at it. They'll have the identic, they have a mirror effect, is really what I'm trying to say. They'll mirror all of their product, um, in their separate vignettes.
[00:29:01] Sid Shetty: Interesting.
[00:29:03] Anjee Solanki: It's so well curated. I mean, so think about the amount of time and thought going into these stores from the brand perspective, and they, they have hired specialists to look at it from the outside in
[00:29:18] Sid Shetty: You mentioned some really interesting and fascinating points, right? Because, consumers are interacting with brands in different ways today, right? And that could be in a store. It could be online. It could be through a channel partner, but irrespective, I think customers want familiarity.
[00:29:40] And I think that creates some sort of loyalty, right? Like, what are your thoughts on that? And, and I'd love to hear your thoughts and also has expectations, have expectations gone up, especially over the past few years, since, since COVID.
[00:29:56] Anjee Solanki: a hundred percent expectations have gone up a tremendous amount. I think when you look at expectations, you're starting to see, um, you know, some interesting, and then there's also edits, let's just call it, uh, with a lot of the retailers. I'm going to, I'm going to go back a little bit to, to restoration hardware for a moment because, you know, when I've been to a lot of their locations across the US and then when they open their location, because I'm San Francisco based, and when they open their location, Uh, here in what we call our dog patch area, it's a beautiful, beautiful store and they have a rooftop area, but of course, you know, a lot of the restoration hardwares also have this hospitality component as I call it.
[00:30:44] So they have a restaurant, a full restaurant, um, and it's well curated, it's actually curated by market. So, uh, each market Um, is the menu will be slightly different, which I think is fabulous. So you could see that in itself is a nuance, right? So to me, they elevated the expectation because what they said is we're going to make this more San Francisco centric versus the one in Marin, which is a little more Marin centric, right?
[00:31:08] It has a different experience and a different flow.
[00:31:11] So, I mean, when you think about everything you just talked about, which is, there's this high expectation of the brands, uh, that consumers love and, and, and, and patron, but at the same time, you also talk about this idea of, you know, conscious consumerism, right? So, as you look at the future and, you know, as you look at the data and the research that your team does, what is the balance that, You know, retailers are trying to strive for, um, because they also have other challenges, right?
[00:31:41] Sid Shetty: There's the consumer facing challenges, and then there's the operational challenges, which is, there's a shortage of talent and, you know, behind the scenes. There's a shortage of, of folks that are can, you know, that are willing to work in retail. And so you're seeing this, um, huge advance, advances in, in technology, you know, with robotics and AI to kind of augment some of those challenges.
[00:32:06] And so what does the, what does the future look like here? What does the, what does the retailer that's looking at the data and is in touch with their consumer do?
[00:32:16] Anjee Solanki: the consumer, I think we saw this, you know, the last four, four or five years, we saw so much change in volatility. We saw COVID occur and then we saw the resurgence of in store shopping. And so we had these peaks and valleys, um, and splurges, right? So revenge spend, we saw luxury, you know, you know, go into double digits beyond 50 percent in sales.
[00:32:45] I mean, it was just, mind blowing. And then you had the, uh, interest rates go up and now slightly adjusting, but then you saw wages go up, right? So, don't forget, wages have gone up across the US and we need to make sure people understand that, um, yeah, people are conscientious, but wages have gone up.
[00:33:05] So people are still spending, maybe not as much as they were. Now, debt has increased, it's climbed. Um, it's, it hasn't, from our perspective, been an alarm as of yet. We're not alarmed. Um, unless something major happens from a macro perspective, we're not yet alarmed. Now, I'll say right now, um, people have saved. They've done well in their savings. You know, CD rates are up, you know, close to 5 percent on the average for the past, you know, call it two years. So when you're seeing that, you're seeing people go, okay, I'm still saving. So I, they feel pretty comfortable and still a bit confident.
[00:33:41] From what we're hearing from consumers, they want to spend on essentials. They're going to be very conscientious on, you know, private label purchases.
[00:33:50] If you stop for a moment and look at the 10 year journey in, in retail, retail has probably been the one constant. Uh, so what I mean by that is retail sales year over year over the past 10 years has been roughly around 3. 4, 3. 5%. Uh, right. So when that doesn't take into consideration, these price hikes because of the interest rates.
[00:34:17] Um, so it's been, let's just say it's been an even, so what I'm saying is it's been pretty sustainable and why, why has it been sustainable? One simple reason. Retail has probably been the most adaptive sector in our industry that can pivot. Honestly, pivot at its tipping point. You say flip, it flips. It did it during COVID. It did it during the digital revolution, whatever you want to call it, between online and offline.
[00:34:54] Sid Shetty: right,
[00:34:55] Anjee Solanki: Right? So, we are seeing retail shift as fast as they can. These are retailers, these are landlords, these are investors, it's everybody. Shift as quickly as they can to accommodate for these, these ever, it's always changing. And I think the reason why they can is because retail always changes. It's, you know, in the past, 20 years ago, yeah, the model was the same. I mean, I remember, oh, you know, this is our prototype. You just can't, we just can't, you know, Take that 20, 000 square foot box, if our prototype doesn't fit, that has changed, that vocabulary has changed.
[00:35:41] We see it, you know, I was, I went to a, uh, a project management conference, uh, several months ago, and we had a couple of grocers there and, you know, They made us all laugh because we all know that this is a constant. They said, okay, here we are. We're in the, on the construction team and our real estate managers will come in and they'll say, Hey, we have these five locations of which three fit our prototype, but these two do not, but you got to figure out how to fit within these two boxes because they are a locations and there's a lack of supply.
[00:36:17] So construction team, figure out how. To, um, fit our box in that. You know, um, circle. Uh, so, so you have to be nimble when necessary. And I think those pressures have allowed retailers and their entire team to figure out ways, um, as long as they're cost effective for those premium locations where they know they're going to do well, because it might be first to market, or they may have closed a couple of locations and this will be their only location. Whatever the strategy is. Um, they'll figure out a way to plug in.
[00:36:58] Sid Shetty: Physical spaces themselves have evolved so much because, you know, of, you know, technologies or marketplaces like Instacart, um, you know, technologies that have Um, force you to think about, hey, how do I interact with the grab and go customer?
[00:37:18] I got to still interact with those customers and do it in a way that is in line with what they expect because they, they did this, they do the same thing in three other places and they want familiarity and they have an expectation of what the experience should be like.
[00:37:34] And so to your point, you know, retail is here to stay. The physical brick and mortar space is here to stay. Is it going to adapt? Absolutely. And that's the biggest strength, right? Which is, you know, this, the space is very in tune with what the consumer is looking for and where the consumer is and has shown a tremendous resiliency in being able to adapt and meet the consumer where they are. Right. Would you agree?
[00:38:04] Anjee Solanki: A hundred percent. I mean, if you think about with interest rates going up, uh, everyone was nervous, right? But yet we still saw, like I said, month over month spend, um, and, and it didn't go down. It actually either stayed slightly above by a percent or two. So it's telling me that, um, the consumer's conscious, they're not going crazy in their spend, you know, and I'm talking about our general economy, not the call it the upper, um, you know, small percentage of consumers who can spend however and whenever they like.
[00:38:41] Markets are always going to have their, you know, their peaks and valleys. And so I think it's just, how do you, how do you, um, listen, learn, and then, uh, create your, your call it your strategy around that moment. Without discarding your long term strategy. So you have your short term because it is short term, but what's your long term and stay dedicated to that long term strategy with, uh, you know, allowing you to take slight detours here in the necessary.
[00:39:11] Sid Shetty: For folks in our audience who, you know, are in functions tied to the physical built environment, what advice would you have on What they should look out for, you know, as you look into the future and how should they articulate within their organization, the impact they have on the brand so that next time someone asks them to just keep reducing their budget versus investing in it, um, They know how to present why, um, they need more investments and the impact they have on the consumer and, um, the top line sales.
[00:39:55] Anjee Solanki: So we actually recently had done a study to that effect where we looked at it. I think it's a couple of things, right? So when you're looking at your brand in terms of its growth strategy, it's important to look at it, you know, call it a five year, a five year program. Um, a lot will change in five years, but if you can at least try to create a foundation against a five year program, you have the ability to look at your existing portfolio, what's worked, what hasn't worked, what stopped you from increasing those sales, what does your online performance look like, and then what has shifted in the physical space?
[00:40:36] Are you located, um, in all the right Uh, or I should say best in market locations. Um, has new location sprouted up? Are you in a great location, but you're not maybe in a great location within that, uh, property or project? Um, how do you then start to look at forecasting sales, um, based on, you know, upgrades you're doing within the stores?
[00:41:04] And so when you start to look at that, you can then start to develop, well, what is the cost of capital for a new store? A relocation, an uplift in terms of a remodel, or a store closure. And if you close And maybe a retailer, um, or a brand has closed and they saw the impact. What does that look like from a financial company?
[00:41:27] So you put all that into a mixing bowl and you start to see, oh, this is very interesting what the data is telling us. And it can help you start to draw correlations. Uh, to then map out kind of that five year strategy. Um, and I think it's important for brands to do that because, you know, whether you're on the retailer side or even on the landlord side, I mean, we do this for our, our landlords as well as we'll put together a roadmap, um, or a three year strategy, um, looking at what does your merchandising mix look like today?
[00:42:00] Where do you have quiet zones versus, um, heavy foot traffic zones? What are those categories that are doing extremely well where you might have too much GLA towards that or less GLA? And how do we identify GLA to increase, um, in that category, whether it's F and B or, um, home or other. So it's really, you got to take that puzzle.
[00:42:25] And just, it's like a Rubik's cube that's all mixed up and you just got to put it all back together again. And by doing that, you have to have key stakeholders with you from who understand retail, the real estate, the data analytics that are, that's out there today, uh, to your point, project construction and project management.
[00:42:45] Cause there's a cost to that, um, the consumer and understanding that consumer and demographics, I think, uh, also having. You know, your, your, um, design and operations and marketing teams be a part of that conversation is also critical. It's not a, um, one size fit all, and it should be done in a silo.
[00:43:08] Sid Shetty: there you go. So one final question, as you look at the future, um, what trend or is there anything that's out there that you're looking at? That excites you, you know, Anjee Solanki, the head of retail, but also, Anjee Solanke, the consumer.
[00:43:27] Anjee Solanki: That's a great question. So, um, I am just dying to see this, two level, uh, Taco Bell, where you basically can drive through and they have like all these drive throughs and the commissary sits on top. I think there's like six or seven of them. Um, it's supposed to be like, really interesting. I want to see that. Um, I also, as a consumer, you know, the one thing I really would ask for, retailers, and it's hard. I get it. So please know I'm saying this with compassion and some empathy. And that is, you know, educating your staff on quality service and understanding the product is so important. If I walk into a store and I'm curious about a product and I'm all, I'm, I'm tempted to buy it, but I have a question and you're unable to answer it.
[00:44:22] Um, it's, it's disappointing because it's just telling me that, you know, you're unable to answer, you know, what this product offering is or give me, you know, like just go above and beyond even a little, just a little, right. That's all I ask. Um, you know, I want my consumer experience in store to be one where.
[00:44:44] You're not, they're not asking me the question. I've had that many a times, like, I'm not sure. Well, what do you think? And I'm thinking to myself, wait, didn't I just ask you this question? I guess we can go look at it on Google together. So yeah, that would be like. Do your best. I know it's hard, but do your best to, you know, uh, educate and train the, the, uh, the boots on the ground that are in the store.
[00:45:12] They're hardworking people. I'm sure they really want to learn as well. And so, you know, please make that part of that consumer journey.
[00:45:20] Sid Shetty: I love it. Well, with that, I want to say a huge thank you, Anjee. I thoroughly enjoyed our conversation. For folks in our audience who want to, you know, look you up, um, and or look up Colliers, uh, where can they find you and, and how can they go about learning more about what you do?
[00:45:37] Anjee Solanki: Great question. So Colliers. dot com, C O L L I E R S dot com. Um, and you can just plug in my name, A N J E E, Anjee. No need to worry about my last name. Uh, I'm the only one with that spelling. And if you Google me as well, you'll find all things retail and the passion that not only I bring, but my entire team at Collier's brings for, for retail.
[00:46:03] Sid Shetty: I love it. And I'm sure when your report is out, uh, folks can find your retail report on the Colliers website.
[00:46:11] Anjee Solanki: 100 percent and we'll be sharing that with you as well. So we'll share together are all of these great reports in this recording on our social channels.
[00:46:21] Sid Shetty: I look forward to seeing it. Once again, thank you so much for being here and to all in our audience, thank you for joining us and I'll see you on the next episode of Elevating Brick and Mortar.
[00:46:31] music transition
[00:46:32] I hope you enjoyed this conversation with Anji Solanki, Head of US Retail at Colliers. It was a fascinating conversation where Anji explains how retail is in a position to deliver on today's high consumer expectations. She believes that retail has always been resilient and has found a way to adapt to changing consumer demands and the economic environment.
[00:46:55] Now is no different. She says that the physical built environment has always been and continues to be pivotal in engaging with the consumer, but it also has a big positive impact on online sales. I personally found this fascinating. So if you're involved in a function that supports the built environment and are looking for some interesting consumer trends to drive your investment outlook, this episode is for you.
[00:47:23] With that, I'm your host, Sid Shetty. and I'll see you on the next episode of Elevating Brick and Mortar.