I love retail. I can’t help it, I think it’s in my DNA. I also really care about our downtown Miami neighborhood, and can’t help but want the many stores to stay open and succeed. But I ask myself every time I stroll outside my beloved condominium… who shops here?
The main reason my curiosity is peaked lies in the fact that our downtown is a seeming contradiction. At times it is a transient area, desolate and desperately lacking the foot traffic to sustain a business. But at other times it can well resemble that vibrant, busy and bustling community more consistent with our southerly neighbor, Brickell.
To answer my query I went on a mission that involved both observation and research. I wanted to better understand the demographics of Downtown, get to know my neighbors and discover to whom the local businesses might be catering to.
After getting my hands a bit dirty, I was able to ascertain that the population of greater Downtown is 92,235, per a 2018 report from the Miami Downtown Development Authority (DDA). In this interesting mix, Baby boomers, Gen X, Gen Y (Millennials), Gen Z are all accounted for and contributing to the local economy (Figure1). Yet they do so in different ways. When it comes to retail, each cohort possesses singular shopping habits and it follows that retailers need to match their offerings to the needs of our multi-generational residents.
In the current retail economy, a common, ubiquitous theme is one of the supercharged consumer expectations. This means that consumers want it all. They are demanding authenticity, convenience, excitement, intimate fantasies and at times even self-esteem. We can better comprehend the supercharged demands of each generation from the simple habits that they display. We can then compare and contrast inter-generational data and see what types of retail would be the best fit for our neighborhood (Table 1).
After examining the data, it is interesting to note some obvious generational differences. For instance, millennials, who comprise the majority of downtown residents and the largest consumer segment worldwide, are four times less likely to support traditional brands and stay loyal to them. While baby boomers, currently the wealthiest cohort, demonstrate qualities that are almost the exact opposite.
Based on the DDA data, the breakdown by cohort locally seems fairly diverse. While Gen Y (the largest cohort worldwide, $60 billion strong according to Forbes magazine) takes the lead with a whopping 41%, the rest of the generations are almost evenly represented.
According to the same DDA report, Greater Miami downtown residents spend approximately $774 million dollars yearly. Their three main focus categories are restaurants, groceries and apparel with $117.8, $111M and $92M respectively. We can extrapolate from these numbers that downtown residents are both young and have a fair amount of disposable income.
On the other side of this equation, the projected revenues from downtown businesses in 2018 come in at $18.6B. This is a fairly substantial number for this population size. In order to fully realize this number or improve upon it, local businesses should heed some of the generational trends. Put simply, retailers need to be nimble and hit the right psychological triggers of their customers while minding the relative demography of the neighborhood. Their attention should be multifocal and omnipresent. Some areas where improvements might be made include:
· Customer experience that is meaningful and personal
· Value focused marketing
· Online and social media presence including cohesive branding experience across all channels
· Clear and concise customer education methods in store and online
· Frictionless retail experience from discovery to delivery
Retail is detail, is a common phrase used in my industry. Ultimately, success is earned not only by superb product offerings but also by identifying who your customer is and by continuously studying and understanding their needs. Perhaps the next time you stroll in the neighborhood, consider all the subtleties that go into having a successful business. Take the time to see who is catering to you and support them with your hard earned dollars. Building a lasting community requires everyone’s participation.