from bricks to clicks mike cohn ring speaker 3 10 14
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Ring Speaker Mike Cohn, Regional President of Lennar Commercial Investors, speaks about his experiences combining the people-dominated real industry with technology, particularity focusing on the millennial generation. He spoke to University of Florida students, as part of the Alfred A. Ring Speaker Series on April 10, 2014TRANSCRIPT
From Bricks to ClicksWhen Demographics and Technology
Collide
• Founded in 1954 & headquartered in Miami, Florida
• 2nd largest homebuilder in the US
• Has delivered homes to more than 750,000 families
• More than 5,500 associates across 18 states
HOMEBUILDING & LAND
FIVE POINT
Land Development & Entitlements
COMMERCIAL
Retail & Office
RIALTO CAPITAL
Investment & Asset Management
FINANCIAL SERVICES
Title & Mortgage
MULTIFAMILY
Apartment Communities
Evolution of Retail
pre-retail
the general store
mail order catalogues
department stores
suburban shopping malls
mixed-use
Retailing Today
E-Commerce
The Millennials
Experiential Retail
E-Commerce
E-Commerce
2013 Retail Snap ShotTotal Retail Sales $5.09 trillion
Retail Sales Increase over 2012 4.2%
Total Retail Sales (excluding cars & food)
$3.57 trillion
E-Commerce Sales $263.3 billion
E-Commerce Sales Increase over 2012 16.9%
Percentage of Total Retail Sales 5.2%
Percentage of Retail Sales (excluding cars & food)
7.4%
Source: US Dept. of Commerce
E-Commerce Sales Trends
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013$0
$50
$100
$150
$200
$250
$300
(US$ billions)
Source: US Dept. of Commerce
2013 Holiday Season
• Store Traffic Sales
• 13% increase in e-commerce sales over 2012
• 54% “last minute” shopping increase
• $1B Internet Sales Days• 2013: 10• 2012: 0
Source of E-Commerce Sales 2013-2014
Desktops - 71%Phones - 18%Tablets - 11%
8 main trends of
June 29, 2007
1. Mobile Goes Mainstream
2. Your Phone Is Your Wallet
3. Multi/Omni Channel Retailing
Multi/Omni Channel Retailing
4. Mass Customization
5. Faster Delivery Times
6. High Tech Coupons
7. Better In-Store Experience
New AT&T store, Manhattan
8. The Shrinking Big Box
Millennials American teens and twenty-somethings (born after 1980) who are making the passage into adulthood at the start of the new millenium
Millennials account for 21% of consumer spending . . . and 33% of their spending is on nonessential items
Millennials make up the largest percentage of the workforce
American Generations
Silent Generation
1927-1945 • Disciplined & Self-Sacrificing• Avid Readers – especially newspapers
Baby Boomers 1946-1964 • Hard working & Driven• Television, Rock ‘n Roll, Activism
Generation X 1965-1979 • Individualistic & Wary of Commitment• “Before” and “After” Computers & Cell
Phones
Generation Y “Millennials”
1980-2000 • Entrepreneurial & Tech Savvy• Digital environment, Internet, Smart
Phones
Generation Z 2001 - Today • Culturally Diverse & Over-saturated with brands
• Electronic-centric & Less Interested in Toys
• Already have Eco-Fatigue
The Millennial Demographic
Millennial Identity
• Technology savvy• Confident and self-
expressive• Liberal viewpoints
and open to change
• Ethnically & racially diverse
• Upbeat• On track to
become the most educated generation in American history
Politics & Religion
• Less likely to associate with organized religion
• Primarily “Independent” but tend to vote democratic
• Only 2% have served in the military
• More optimistic about America’s future than any other generation
Technology• 92% have a
smartphone and a laptop
• 83% sleep with their smartphones
• 81% are on Facebook
• 74% feel that technology makes their lives easier
• 50% have posted a “selfie” online
• Millennials spend 21 hours/month on social media
Economics• Began to enter the
workforce during the recession
• High levels of student loan debt
• Lower levels of wealth & personal income
• 1 in 8 have moved back in with parents
• 21% are married• 34% have children• Price conscious
and deal savvy
Source: Nielsen & Pew Research Center
Millennial Shopping Trends
• 88% of Millennial smartphone owners used their smartphones for holiday shopping
• 77% browse online before purchasing in the store – nearly 17% higher than the general population
• 56% admitted to browsing for an item in the store and then purchasing it online from a different retailer – double the rate of the general population
• 19% have been in a store and purchased an item via their mobile phone from a different retailer while still in the store – double the rate of the general population
• 89% would not return to a store if the inventory they confirmed was there was not available upon visit
80% of Millennials consider themselves price conscious and promotion sensitive
Extreme Couponing
97% of Millennials would return to a retailer if
provided with a discount for future shopping events
92% download coupons to their retailer cards before shopping and 80% at the store
79% use paperless coupons
67% go looking for deals after hearing
about them on social media
80% are more likely to frequent a store if it provides a rewards
program
Experiential Retail
59% of consumers say they have all the material possessions
they need
Consumer experience is the single most important factor in continued
growth for retail brands.
Experiential retail is one-on-one engagement between a company’s offering – either product or service –
and the consumer themselves.
Shoppertainment
Virtual Grocery Shopping
Tesla Showrooms
Pop Up Shops & Virtual Storefronts
Top Performing Malls in the US - 2013
Mall Location GLA Sales/SF
Bal Harbour Shops Bal Harbour, FL 450,000 $2,555
Forum Shops at Caesars Palace
Las Vegas, NV 636,000 $1,750
Shops at Columbus Circle
New York, NY 338,000 $1,600
The Grove Los Angeles, CA 575,000 $1,400
The Mall at Millennia Orlando, FL 1,118,000 $1,250
Ala Moana Center Honolulu, HI 2,100,000 $1,200
The Mall at Short Hills Short Hills, NJ 1,370,000 $1,110
The Americana at Brand Glendale, CA 450,000 $1,110
Aventura Mall Aventura, FL 2,700,000 $1,100
Tysons Galleria McLean, VA 824,000 $973Source: ICSC – Shopping Centers Today
Development Impact
• Smaller, Urban Mixed-Use Centers
• Transportation Oriented
• Highly amenitized• “Fiberhoods”• Social Media
• Dramatic Change in Merchandising Strategies• Old Approach: merchandising mirrored the way we bought our clothes –
compliments with large chain stores• New Approach: merchandising mirrors the way we live our lives – specialty,
green, quick serve, chef-driven farm-to-table dining, wellness
Question: Is it sustainable? What happens when baby boomers need congregate care and millennials need schools for their children?