Traditional retail in Chicago can wade through the shifting commercial economy’s currents, made treacherous by the growing market power of e-commerce giants like Amazon, if it remains “nimble”, treats technology as an asset, and plans for the long haul—by preparing industries or sectors of the economy that have the potential for growth and jobs. That was the overarching theme of The Daily Line’s panel Thursday night on the future of retail in Chicago.
In the last decade, the emergence of e-commerce retailers and ubiquity of mobile phone technology have made it hard for both traditional mom and pop stores and big box retailers like Sears to catch up, stressed Tanya Triche, General Counsel of the Illinois Retail Merchants Association. She pointed to Amazon’s recent acquisition of Whole Foods and that the iPhone has just marked its 10th anniversary. “Who are we in this economy? We are all struggling with this question,” she said.
Wayne Caplan, an Executive Vice President of SVN Chicago Commercial, argued that while many mark the 2008 Recession as the biggest blow to the U.S. economy, Illinois retail never really recovered from the tech bubble bust in the early 2000s. The mass exodus of individuals out of Illinois has also impacted retail growth, he added: retailers crave locations in densely populated areas, preferably filled with people who have jobs and disposable income.
But e-commerce’s growth isn’t a zero sum game for the economy overall, said the panelists. The future of Chicago won’t necessarily be that of empty storefronts along once booming retail corridors like Michigan Avenue. Chicago’s newly confirmed Commissioner of the Department of Business Affairs and Consumer Protection Rosa Escaraño said if government is “nimble”, open to removing outdated regulations built around the old economy.
“We are not the market makers, we’re there to meet businesses where they need us.” She pointed to “encouraging emerging markets” that are growing in Chicago, like shared kitchens. Malls, built for the car-centric consumer economy, could still remain relevant gathering places with bowling alleys, theaters, and other events and experiences that can’t be purchased online, added Triche.
One solution that could improve retail is by investing in neighborhood businesses, those that cater to the local needs of residents, said Jaime Di Paulo, Executive Director of the Little Village Chamber of Commerce. Di Paulo credited reinvestment with keeping 26th Street a vibrant part of the community. Triche said businesses should also use technology to their advantage–rely on big data to better understand trends, consumer interests and create the “highly customized” shopping experiences many have come accustom to with the advent of apps.
All agreed that Chicago should also consider updating its zoning code, particularly as it relates to the requirement in most zoning districts that groundfloor be reserved for commercial retail. They may still make sense along highly trafficked corridors like Milwaukee Avenue, but “in many places it’s a fait accompli”, said Caplan. Proper zoning is essential for business to thrive, he stressed, giving the example of Winnetka, a ghost town” he called it, because of the its prohibitive zoning.