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If you know me, I have a lot of theories and it’s very rare that I completely nail something and that my predictions and analysis are spot-on but 15 months later – this article I published in September 2019, turns out is very prophetic. This is a rare drop-the-mic moment.
Backstory:In my original post and article, I argued that retailers should use the theories laid out by urban theorist, Richard Florida who, in 2002 famously, published The Rise of the Creative Class: And How It’s Transforming Work, Leisure, Community, and Everyday Life.Backstory:
Mr. Florida theorized and prophesized that cities which attract and retain creative residents will prosper, while those that do not stagnate. Read an article he wrote from 2002 here: https://washingtonmonthly.com/magazine/may-2002/the-rise-of-the-creative-class/
His argument, in short, was that in order to save themselves from post-industrial ruin, cities needed to attract the best young talent in computer programming, engineering, finance, media and the arts so their towns could build economies based upon the venture capital and start-up companies the new workforce would produce. By Jonathan O’Connell, April 17, 2017, Washington Post, here https://www.washingtonpost.com/news/digger/wp/2017/04/17/as-the-creative-class-divides-america-its-inventor-richard-florida-reconsiders/
I agreed with his theory and extrapolated that the same argument could be made for retailers. My argument was that retailers, like cities, need to cultivate the creative class to survive. This group shops and has discretionary money. While they tend to be more digitally oriented; brick and mortar stores (which presumably have digital retail as well) should cultivate loyalty from this group. My original article is here:
Please Note: Mr. Florida added to his original theory and expanded his theory to address gentrification – you can read more about that here Washington Post article titled (sic) The Creative Class Inventor Reconsiders here:
What. 18 years after the publication of Mr. Florida’s book, we see moves of Silicon Valley and Finance leaders moving to cities like Austin and Miami. These cities actively developed with the creative class in mind.
If you’ve been under a rock, you can read about these moves here:
Miami-area, Florida:Among the major investment firms moving key activities to Florida are 1) Paul Singer’s Elliott Management Corp. moving its headquarters to West Palm Beach from midtown Manhattan; and 2) leading firms like Blackstone Group Inc. and Citadel increasing their presence in the Sunshine StateBusiness InsiderNYTimesBloomberg
Retail Boon?What does this mean for retail? Well, Austin and Miami win and New York and Silicon Valley and the surrounding areas lose. The losers need to do their darndest to “move digitally” with their clients. And for brick and mortar in the Austin and Miami – game on! You have a lot of new clients to entice. Bring your A game!
Referencing my closing argument from the original article: The blueprint for growth was laid out right in front of retailer’s eyes! How could they miss these shifts that were happening in real estate, urban development, and the workplace and not evolve with it? As we have the luxury to stand in the present and judge the past, based on what we see today in traditional retail winners and losers, it’s tough to find any evidence that these powerful shifts were incorporated as economic drivers into many of the struggling traditional retailers’ strategic plans.
Retailers cannot miss this gold rush, not this time! Footnote:If you are in commercial real estate and retail development, you can hear more directly from Mr. Florida at the following Event: