HomeMy WebLinkAbout2018-11-28 EDAC minutes
ECONOMIC DEVELOPMENT ADVISORY COMMITTEE MINUTES
November 28, 2018 City of Kitchener
The Economic Development Advisory Committee met on this date, commencing at 11:00 a.m.
Members: Anthony Zammit, Barry Lowry, Councillor Bil Ioannidis, Jason Malfara, Jeremy
Auger, Johanna Classon-Romero, Mark Bingeman, Councillor Paul Singh,
Sandra O’Hagan, Councillor Scott Davey, Shirley Madill
Staff in attendance: Brian Bennett, Chloe Howell, Chris Farrell, Cory Bluhm, Hilary Abel, Lauren
Nelson, Valerie Bradford
Delegations: Howie Budd
Owner of former Budd Department Stores
Justin Chung
Manager, Development at The Cadillac Fairview Corporation Limited
Sara Bingham
Entrepreneurship and Technology Advisor, Waterloo Region Small Business
Centre
Business Items
1. Retail Shift
1.1 Howie Budd was asked to offer EDAC his view of the changing nature of retail, with the following
questions posed as a guideline for his presentation:
a. How did the nature of retail change from your perspective?
b. What was the impact of online retailing to your business model? In particular, your thoughts
on the impact of independent retailers (i.e. non national level chains)
c. From your perspective, how easy/difficult would it be to adapt or transition an independent
retail business to online retailing?
d. What do you see as the opportunities for independent retailers to success? Any
recommendations on what could be done to help?
In 50 years working, online retail was the biggest thing to combat. How do independent brick and
mortar stores compete? Howie’s model consisted of providing unparalleled customer service, the best
quality products at the lowest prices and delivered more to customers than what was expected.
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ECONOMIC DEVELOPMENT ADVISORY COMMITTEE MINUTES
November 28, 2018 City of Kitchener
The personal connections and relationships built with individual customers is something you cannot get
online. Another example of personal connections and operating “outside the box” was when Budd’s
partnered with the KW Humane Society and used their window displays to show kittens for adoption.
The Budd team created an online component to broaden their customer base, particularly to a younger
generation. However, not only could customers see a product online, they could also come into the
store and see the physical product. For online shopping, sometimes all you see is a digitally enhanced
photograph and you do not know what you are actually buying until it arrives on your doorstep.
Managing an online platform can be very expensive and time consuming for independent retailers.
Budd’s attempted to provide points of interest for people that had nothing to do with online retail; for
example, providing recipes.
To sum up Howie’s recommendations for independent retailers navigating the online retail world:
You need to know what your customers want, and then make sure your store provides these
products/services.
Build relationships and make customers feel special with personalized service.
Events and experiences create memories and loyalty.
The Waterloo Region Small Business Centre is a focal point of assisting independent retailers.
They provide valuable seminars and programs and expertise that will help businesses navigate
changes.
The future is about creating relationships and giving customers positive experiences.
1.2 Justin Chung gave EDAC a presentation on the changing nature of retail and what Cadillac
Fairview is doing to mitigate these changes. Justin first gave the committee a very brief history of retail
from ancient times to where we are today. The mall as we know it began with the rise of automobile
culture and the growing population living in the suburbs. Over the years, there has been no shortage of
exits in the retail industry, of which Target, Sears and Zellers are all prime examples.
Walmart is an example of a store that has succeeded over time. This company slowly entered the
Canadian market and curated stores over time to suit individual locations. Walmart is logistically very
successful, whereas Target, who opened over 100 stores in Canada in one year, assumed they could
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ECONOMIC DEVELOPMENT ADVISORY COMMITTEE MINUTES
November 28, 2018 City of Kitchener
use the same model as their US based stores and failed to adjust according to specific Canadian
markets.
As for Sears and Zellers, Justin put forward a reason these companies were not successful in the long
term is that they offered no value proposition or specific branding experience. For the most part,
customers were neither treated very well or very badly and the shopping experience was very
mediocre. Examples of companies that have specific value propositions:
Cheap, fast fashion – H&M, Zara, Winners, Marshalls
Luxury, brand, service, aspirational – Saks Fifth Avenue, Prada, Louis Vuitton, Nordstrom
The internet is driving very significant changes in the retail industry in two main ways:
1. Online shopping: e.g. Amazon, eBay, Walmart. Online companies are also expanding their brick
and mortar offerings; for instance, Amazon purchasing Whole Foods.
2. Social media: e.g. Instagram, Facebook, Snapchat. There is a millennial shift from consumer goods
to experiences, experience has become a product that gains traction through social media. People
are more concerned than ever before about the experience of shopping and not just the product
itself.
Another significant industry changer is the rise in popularity of ‘experiential retail’. An example of this is
the Mall of the Emirates, which includes shopping and dining but also adds the experiential element
with Ski Dubai, Magic Planet (a family entertainment centre) and five hotels. Two other examples of
experiential retail is CREACTIVE, Cirque du Soleil’s first family entertainment centre in Canada
(opening at Vaughan Mills in 2019) and The Rec Room, based on the idea of an “adult emporium”
providing food and entertainment options.
Some key factors when considering the next generation of shopping malls:
Intensification of existing sites;
Diversify, mixed-use development (offices, residential, hotels);
Create a vibrant streetscape, town centre/central square idea (green space, restaurants); and,
Adapt for experiential retail.
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ECONOMIC DEVELOPMENT ADVISORY COMMITTEE MINUTES
November 28, 2018 City of Kitchener
Questions/comments:
Partnerships are more important than ever before. CF Richmond and CF Shops at Don Mills
both partnered with a home builder.
Independent retailers have generally outperformed large chain stores in providing quality
service and building trust with customers. Large retailers have started paying attention to the
individuality of the customer and the importance of social media, and are changing
strategies as a result.
What does CF do to attract new tenants? A dedicated team of leasing agents, constantly
assess trends and act on existing relationships. Follow international trends and look to other
countries for inspiration.
Zoning can be too restrictive, it is important to allow for flexibility, change and growth in
planning strategies.
Renovating ‘food courts’ into ‘dining halls’ in order to provide an elevated experience (i.e.
non-disposable plates and cutlery).
1.2 Sara Bingham works as the Entrepreneurship and Technology Advisory at the Waterloo Region
Small Business Centre. Digital Main Street is a free program that helps businesses with the adoption of
digital tools. The program is designed to help companies who do not have the time and/or expertise to
manage their digital assets.
Digital Main Street consists of an online assessment and eight hours of training videos. There is a
“Digital Service Squad” to help optimize digital tools and provide support along the way. Grants are also
available to qualifying businesses.
The coaching aspect of this program is vital, as the goal is to help retailers become comfortable using
online tools and able to independently maintain and update their digital assets. The biggest resistance
that Sara has found from companies is that they think the adoption of technology is “too hard.”
Other
1. ACTION: C. Howell will redistribute survey for ranking 2019 EDAC topics
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ECONOMIC DEVELOPMENT ADVISORY COMMITTEE MINUTES
November 28, 2018 City of Kitchener
2. Councillors S. Davey and P. Singh thanked the committee and informed EDAC that they would
not stand for re-appointment, in order to provide the opportunity for other Councillors to sit on
EDAC.
Meeting adjourned at 1:00 p.m.
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