Is There Another Way?
Since I broke into this business just over 20 years ago, the industry has customarily used radius ring demographic reports. What would we do in the Philadelphia suburban market without the 1, 3, and 5-mile radius ring demos? They have always been and have continued to be a great resource to give you a general idea of who exists in a market. I use them to this day for every retailer I have the pleasure of representing. However, we needed an additional tool. It didn’t necessarily need to be better; it just needed to be different. What if there was a river or natural boundary preventing customers from reaching a site? What if customers couldn’t freely flow from one side of an interstate or turnpike to the other? What if a site was just off the interstate and allowed customers to come from a vast trade area? A radius ring demo report wouldn’t accurately account for any of these conditions. Therefore, most of all my clients and I also use a drive time demographic report to account for these subtleties.
Bring In the New…
This new resource shows us the same locale, just from a different angle. In short, the report shows us the demographic within a specified amount of driving time from the respective site. It accounts for natural barriers, road patterns, and speed limits, among other factors. As an example, we can look at the demos surrounding a prospective Starbucks site within 5 minutes of driving time. In fact, for Starbucks, we measure the demos at 5 minutes and 10 minutes. For retailers who are not as much a convenience use, where customers visit their stores less frequently, customers will typically come from farther away. When we worked on the Shoe Carnival roll-out in the Philadelphia market, we used 10, 15, and 20 minute drive times. All were used to better understand potential customers surrounding the site at different intervals.
Many times retailers and restaurants track and understand how far their customers travel to reach one of their units. For one specific anchor tenant, we knew it was normal for their customers to travel up to about 20 minutes to reach a store. Therefore, we provided the 20 minute drive time demos for our proposed locations. Then, we took it one step further to convince them to come to our market and provided the drive time demos for eight other existing suburban stores around two similar metropolitan markets. That specific type of demo analysis showed how our sites significantly outranked the demos of the existing stores and helped convince the tenant that Philadelphia was a viable market.
I have often been the master of the obvious. Retailers and restaurants can’t afford to open bad locations. I want my name, and my company’s name, tied to successful stores and restaurants that are profitable for many years into the future. The likelihood of identifying those great spots is increased significantly with the use of of detailed, accurate data. A demo report, more specifically a drive time report, is a valuable tool when working to achieve these goals. Using this type of report is frankly a demonstration to your client that your are qualifying sites at a much higher level. Is the site straightforward or does it need a deeper dive? Does the market surround the site for all 360 degrees or really only 180 degrees because the site backs up to a major river? Care about the clients and the sites like it was your money and your business. Would you want to understand the customer base to that level of detail? The answer: of course you would.
I welcome the opportunity to talk further about these tools and all the others we use in this modern age. They are integral to the process today, to say the least, but at the same time they make the job more fun, interesting, and they leave so little to chance. Thanks for your time. If I or anyone at Equity Retail Brokers
can be a resource for you, please don’t hesitate to call.