Trend and Future of Retail Space: Part 1

  Jooyun Kim's 
Spacebranding vol.26


"The retail space is more fascinating because it's hard to handle".

<Why do we talk about retail space?>
The 'hip place', where people visit, is mostly a retail space. Cafes and cultural complexes, which spring up every day at Yeonmujang-gil, Seongsu-dong and flagship stores near Dosan Park are all commercial spaces. As a matter of course, the retail space with free access always wants the public's attention and is often talked about because the space for giving or working is inevitably an exclusive space. However, it may not be just because of the intrinsic nature of the purpose that we explore and talk about retail space.


Illustrated by Roh Joonchul

According to the NCREIF Property Index (NPI) announced by the NCRIEF of the United States, retail assets occupy the third-largest proportion after offices and apartments. However, including warehouses and logistics real estate related to the retail market makes rank the highest. This is the same in the real estate indirect investment market. In the U.S. REITs market, the retail real estate boasts almost twice the size of offices, and it can be seen as the most important market in name and reality.

Illustrated by Roh Joonchul

Retail space is always on the issue because it is bound to be sensitive to trends. Among them, the domestic market has a short cycle of change that even the global market can speak out, so experts in the retail branding and marketing industries rarely have time to rest.

Noh Hee-young, CEO of the Food and Beverage Research Institute, which has released numerous hit works for CJ's F&B brands, would say that she studies contemporary trends while watching YouTube at double speed. However, from the customer's point of view, it will feel more exciting and dynamic than ever in this era where new experiences are being created and constantly changing.

<The evolution of the retail space: A journey of innovation to reduce ‘transaction costs’>
In an era where changes in the months ahead are changing so rapidly that it is hard to guess, it may feel futile to predict how retail spaces will evolve in the future. However, as in the field, there will be differences in speed, but if we look at the historical changes in the retail market in the past, it may be possible to give some probability to the prediction.

Illustrated by Roh Joonchul

The most important concept in examining these changes in the retail market is ‘transaction cost’. Transaction costs represent the resources necessary to conclude a transaction between the parties to the transaction. (Quote, Rethink of Real Estate, Dr. Flex) Assuming that we are buying a cell phone, we will compare the most reasonable and affordable price and terms of purchase with the sellers' conditions first.

After that, we examine how delivery is carried out and the conditions for customer service and repair for problems that will occur later. Transaction costs are the time, effort, and costs we spend in this process.

The evolution of the retail platform can be seen as a product of the mobilization of contemporary technologies to reduce transaction costs. Suppose we go back in time and buy a bag in an arcade in early 19th century Paris as shown in the picture below. There is no way that there will be a platform that allows you to compare products at a glance from the cell phone in your hand as it is now. I have to go into the store one by one to compare what products exist and the quality and color that I can buy with my money.

SHOPLIFTER Arcades, Paris: circa early 19th century, from John Daish Pinterest https://i.pinimg.com/originals/80/ff/25/80ff25aad7e98fb7efb165ac6fe2b14a.jpg

This is not the end of the problem. The comparison of prices, the most important measure of purchasing a product, also requires tremendous effort. At that time, the reconnaissance system was not established, so we had to ask the store manager one by one to find out the price, and we had to repeat it in each store. (Of course, there are markets with information asymmetry even today. A typical example is the wedding industry.)

Bargaining is the next step you will face after selecting an appropriate store among the prices you have found difficult. At this point, it is questionable how many people will be able to go back to the 19th century and buy a bag.

How about the shipping problem? Of course, there was no e-commerce market at that time, so we can't compare, but if you buy a bulky product rather than a bag, you can't overlook the problem of having to take it home. In addition, how was the way to this store before purchasing? Since it was not the time when public transportation existed as it is now, the time and effort to get there would have been difficult.

e-commerce from CardMapr, Unsplash.com

Comparing the transaction cost of purchasing one item with the current era, you can feel how innovatively the retail market has evolved. The change from department stores to large shopping malls such as Starfield, and to the convenience of shopping on smartphones that can view this post now, could have been possible because of the enthusiasm of the retail market participants to reduce transaction costs. 





<5 Summaries>

“The retail space is fascinating content because it is difficult to deal with.”

"The 'hip place', where people visit, is mostly a retail space."

"Retail space is always on the issue because it is bound to be sensitive to trends."

"The evolution of retail platforms is the product of technologies that have been mobilized to reduce transaction costs."

"Comparing the transaction costs of purchasing an item with the present era, we can see how innovatively the retail market has evolved."



Roh Joonchul
zipggun@gmail.com​











Comments

Post a Comment

Popular posts from this blog

The Beginning of Space Branding: Prada Epicenter

Image
    Jooyun Kim's  Spacebranding vol.14 "Prada has imprinted on the public what 'Prada luxury' is with one marvelous space." <Guggenheim Museum to Prada flagship store.> In 2001, a spacebranding space was created in Soho, Manhattan, New York. 'New York Prada Epicenter' is a Prada flagship store. The author takes this space as the beginning of a true modern "spacebranding." 'New York Prada Epicenter', Soho, New York © Jooyun Kim Soho New York ©  Jooyun Kim Prada opened the Guggenheim Museum branch in Soho, which once led American art to the center of the world and was a leading art street, to the public as a flagship store. However, the store's approach was fundamentally different from before. It's a store that doesn't look like a store at all. Prada eliminated the area by drilling nearly half of the ground floor in Manhattan's Soho, where the price per floor area is high. The first floor and the basement are directly ...
Read more

Space is the brand's worldview and media

Image
  Jooyun Kim's  Spacebranding vol.41 "Space branding is controlling everything that is seen in the world to be ideal for a company or brand." <Lotte World Character Lotty's apartment> What does Lotty, a 32-year-old employee, do after work? It is the story of Lotte World's character Lotty. In August 2021, "Lotty's Apartment" was created as a pop-up store on the streets of Seongsu-dong. The goal is to announce the rebranded character Lotty. It was intended to experience the newly created Lotty's worldview through space. Lotty's Apartment by Project Rent ©Jooyun Kim Although it was August, when it was difficult to move due to the rainy season and the heat wave, more than 1,000 people a week visited the small apartment on the street. The space consists of a living room and a home office, and various props for the Lotty, such as pouches and household items, were made. Lotty's Apartment by Project Rent ©Jooyun Kim Of course, I was able to...
Read more

What is Good Space for Space Branding

Image
  Jooyun Kim's  Spacebranding vol.39 “A ‘good space’ for space branding is a Dionysian emotional space.” < 'Space' = 'Symbol of meaning'> Human beings think through 'words,' says psychoanalyst Carl Gustav Jung. Visual images are also like words. ‘Positioning’ is a term used to describe the concept of positioning a company, product, or service in the most advantageous place in the mind of the customer. Marketing theorist Jack Trout, who first popularized it, says: “The word ‘word’ is like the trigger of a gun, which triggers the meaning buried in it.” 1) The spatial image we see is something that replaces something that can be accessed with a purpose, a 'symbol' of meaning. German psychologist Rudolf Arnheim reveals that a person's reaction to the figure and the psychological state can be judged only by a drawing of a curved, smooth figure or lightning-like sharp figure on paper. If the clumsy graffiti painting on paper is the same, it can b...
Read more