A critical component of driving retail sales is correctly defining trade areas. As was mentioned in a recent blog post, get it wrong and the data is meaningless. But as we know, trade areas are often a reflection of destination drivers and overall access. Are there anchorinstitutions like movie theaters that act as magnets for customers? Nearby subway stations or bus routes popular with commuters? What is the distance between these assets and the retail itself? Does crime or poor walkability dissuade shopping? With these thoughts in mind, I wanted to turn a critical eye towards a recent shopping experience I had at a Bed Bath and Beyond located in Brooklyn’s industrial waterfront. I wanted to look at it through the lens of defining trade area because an industrial environment can pose challenges for retail and the siting of this store felt particularly bold. Yet here was a retailer cognizant of the challenges of an industrial location and had created some compensatory measures.  Though this case study does not resemble a traditional downtown business district, I believe it has implications for our practice and for developing waterfront commercial districts.

Why did I make the trip?

In short, because I needed to return some merchandise. I became familiar with Bed Bath and Beyond’s robust return policy several years ago when I had to buy some plumbers tape. The store associate sold me on a substitute product that I was sure wouldn’t work (it didn’t), but he assured me that I could return it if necessary. Not only that, but I could return virtually anything purchased at Bed Bath and Beyond at any time in the future and get a full refund.
 
Fast forward to last week–I have visitors staying at my place from out of town and the slow-leaking Bed Bath and Beyond Aerobed air mattress in the top shelf of my closet suddenly needs to be replaced. I decide to put this return policy to the test and found the closest location in the recently opened Liberty View Industrial Plaza. The drive is roughly 20-25 minutes. This might have been enough to dissuade me from going there to buy cutting boards and dish sponges, but it did not dent my inelastic demand for the replacement of a $170 air mattress.

What was my retail experience?


Driving southwest along Third Ave, under the Gowanus Expressway, the turnoff into the parking lot feels hairpin and sudden with no obvious signage to aid a midblock ingress. I do not feel that I am entering a commercial district by any measure. However, once the turn is accomplished I find a spacious no-fee parking lot and a sense of relief. I also notice that the surrounding buildings comprise Industry City; a 40-acre innovative maker hub with over 400 local companies. Maybe this is not a commercial district, but it’s not an ordinary industrial district either. I turn back to the Liberty View Industrial Plaza. The building gives the appearance of an unassuming warehouse typical of the Brooklyn waterfront, but the front façade quickly leads me to realize this is not a standard Bed Bath and Beyond. This is “Beyond at Liberty View,” an indoor retail shopping complex incorporating several additional stores from the company’s portfolio: Face Values, buybuy Baby, and a Cost Plus World Market. 
 
I enter the building and remark upon the post-industrial aesthetic of steel girders and cross beams, grated ceilings, and exposed brick. My attention is also drawn to the 13ft bronze statue of Captain America (“I’m just a kid from Brooklyn”) nestled between the two main entranceways. In addition to the aforementioned stores, the shopping center offers a range of services: a blow-out hair bar; a portrait photography store; special event space for cooking demos; concierge services for a personalized shopping experience; and a help desk to facilitate home deliveries. A coffee bar serves Brooklyn-based roaster Toby’s Estate and an on-site restaurant boasts an “all-star lineup” of local food and beverages.
Walking towards Bed Bath and Beyond I see a display table near the entrance advertising a carefully curated “Born in Brooklyn” selection of products sourced from local Makers. It’s a significant but endearing contrast from my usual associations with the store: stacked floor to ceiling boxes of uniform products and an “As Seen on TV” section. I also discover they have a Keurig coffee station at the back of the store where patrons can sample different flavors of complementary K-cups and enjoy seated views of the waterfront. With a coffee in hand, I proceed to the customer relations counter and am pleased to find that the return policy is as robust as promised. They take my old air mattress and provide a replacement at no charge. This prompts me to buy several extra items before I eventually leave and return home.    

Upon Reflection

Putting a Bed Bath and Beyond in an industrial use district feels counterintuitive. It’s certainly not unheard of to find retail in such a place—IKEA and Home Depot are two prime examples. But those retailers are category killers more akin to warehouses with showrooms. They can afford to be single tenant buildings and still pull from a larger trade area while Bed Bath and Beyond collocates with other retailers and benefits from foot traffic. What I observed in my shopping experience was a conscience effort to address the pitfalls of industrially located retail by utilizing many of the best practices we discuss on a regular basis (see chart below). 
Andrew Hoan, president of the Brooklyn Chamber of Commerce, is quoted in an article by Bklyner.com as saying that Brooklyn retailers are losing out on almost $6BN in consumer spending. That is a huge opportunity for retailers if they can figure out how to capture more customers in their own borough by growing their individual trade areas. That does not necessarily mean instituting favorable return policies on every product—something I can assure you hardly figures into our calculations. However, it does mean dipping into a toolbox of different best practices that can have an altogether profound impact. I may not need to go to Bed Bath and Beyond for a while, but that Cost Plus World Market is the only place I know in the city that sells Arnott’s Tim Tam cookies.