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Matt Katz: It's The Brian Lehrer Show on WNYC. Welcome back, everybody. I'm Matt Katz, keeping the big seat warm for Brian today. Now, let's take a look at a recent trend in retail real estate, following the rise of e-commerce in the 2010s. Mutters about the death of in-person stores began to accumulate. Gloomy forecasting reached a fever pitch when pandemic shutdowns led to an abrupt drop in in-person shopping in 2020. In fact, physical stores are now alive, even thriving. They're just changed form.

A recent article from The Atlantic explores how brick-and-mortar stores have adapted to the age of e-commerce. Physical stores have grown smaller as they transition into their new role as showrooms that complement the online shopping experience. Joining us now to discuss the evolution of physical stores is Lora Kelley, associate editor at The Atlantic and an author of The Atlantic Daily newsletter. Her latest piece has the pithy headline, Stores Are Small Now. Hi, Lora. Welcome to WNYC.

Lora Kelley: Hi. Thanks so much for having me on. It's great to be here.

Matt Katz: Excellent. Lay it out for us. How do the stores of today compare to shopping in the pre-e-commerce era and how they'd be become popular like this? What's going on with these stores?

Lora Kelley: Yes, absolutely. The bottom line is a lot of American stores are simply getting smaller. A generation ago, you may have walked into a big department store at a local mall or in your town and seen just an enormous array of options, shelves and shelves full of every color and size of T-shirt and sweater. You may have gone shopping with the expectation that you would leave the store that day with a bag full of merchandise. A trend that we're seeing in retail now is that a lot of stores, including some of the classic big American retailers, places like Macy's and Nordstrom are opening much smaller outposts.

The idea here is that shoppers can go into really more of a showroom and see a selection of the new merchandise, maybe chat with an eligible salesperson and get some guidance on the new styles and then order online.

Matt Katz: They are ordering online because all the sizes aren't stocked at all. It's just a way of looking at stuff and trying stuff on and then maybe going online and picking a different color and having it delivered to their home.

Lora Kelley: Yes, exactly. The way that I've been thinking about it is that a lot of these stores are not just trying to compete with online retail. They're trying to complement it. As one professor who studies this that I spoke with put it, basically, a lot of these stores are gathering a lot of data about shopping trends in an area, and they're stocking the showroom floor with the items that they think will be most popular with shoppers in an area, and then have people come in, have them take a seat, look at some flowers, enjoy a lovely setting.

Once they leave the store, it's fine if you don't walk out with bag stuff with merchandise, but shoppers should expect to have email follow-ups with discounts. Even if they walk out that day without making purchases, hopefully, they'll make a purchase soon. The generous way to put this is that these smaller stores are trying to educate consumers. A little bit of the less generous way to put it was it would be that these stores are trying to indoctrinate people and get them to have a great impression of the brand and want to always order online from here on out.

Matt Katz: Yes, I saw you use that word indoctrinate. Really interesting. I walked into a store in the spring looking for a suit of my daughter's bat mitzvah, and they didn't sell any suits there. They just took your size, measured you, sat you down, it was a lovely little store, and then they would order something, but literally, you could not walk out with a shopping bag of clothes. Is that something that is also happening? Have you noticed that at all?

Lora Kelley: Yes, so interesting. Well, first of all, congratulations to your family. That's very exciting.

Matt Katz: Thank you so much.

Lora Kelley: Yes, absolutely. I know. I work in SoHo. That's where The Atlantic's New York office is. If any listeners have gone shopping in SoHo, you may know that it's a shopping mecca. There are many amazing stores, but a lot of the stores are also really small. I know that I myself have snuck out on a lunch break to check out a nearby store and found that there's a really selection of things. I may be able to try on one or two dresses that they have in stock, but really, the options for people are going to be online.

That's really where stores today are stocking the full range of their merchandise, rather than having racks and racks of dresses, sweaters, and whatever it is in store.

Matt Katz: Listeners, please chime in. I know that back to school shopping mania might have left shopping fresh in many of your minds. How has your shopping experience changed with the rise of e-commerce? Have you ever browsed in a physical store and then ordered online instead? Maybe the store didn't have the right color in stock. Maybe you wanted to wait for a lightning sale. Or maybe you got on a mailing list and then saw something you liked later on in that email. Have you been frustrated by limited options in new, smaller stores maybe?

Tell us about why this model works for you or doesn't. Give us a call or send us a text. 212-433-WNYC, 212-433-9692. We'd also be interested in hearing from retail workers. Do you feel that your sales role has shifted? Are you doing something different than you used to do? Are you advertising for the larger entity of your company's brand rather than encouraging shoppers to buy a specific item right here and right now? Do you find yourself directing customers to the website? Call or text us. 212-433-WNYC, 212-433-9692.

Lora, in your article, you mentioned that physical stores sometimes employ experiences to give shoppers a positive association with the company's brand. You mentioned flowers, but what are some of these other experiences, like when you walk into one of these smaller stores?

Lora Kelley: Yes, absolutely. One is just the showroom experience. Maybe there's beautiful furniture there, lovely flowers. As you mentioned, a warm salesperson there to give you personalized attention. Some stores, too, have also incorporated things like manicures. Nordstrom launched something called Nordstrom Local in the 2010s. I was a much smaller outpost than the traditional, huge Nordstrom stores that many people may associate with their local mall. They offered manicures.

A lot of places, too, are offering things like alterations or you can drop off something, so you don't have to go to the post office. Really, the idea with these stores is sure they are, in a traditional sense, a place to buy stuff, but they're also a place to take advantage of a range of experiences, and also, frankly, have some convenient amenities.

Matt Katz: It seems competing companies often sell comparable products. I feel like I can go into Banana Republic and maybe it's similar to what I might see at a J.Crew, and it feels a little bit more similar than maybe it used to, and you can't really identify which piece of clothing might go with a specific brand. Do you think retailers focus on building brand loyalty is a strategy to just try to get consumers to look for another version of a product at their company rather than another one? Is that part of what's happening here?

Lora Kelley: Yes, it's such a good question. The way that one marketing professor put it to me was that basically a lot of these stores physical outposts are almost operating as marketing for the brand. It's not only that people can go in and buy things. It's really about, do you have a positive association with the brand? Do you go in and get a manicure and chat with someone and have just an amazing time in the store?

The hope here is that people will-- Yes, think really well of the brand and maybe, next year when they're doing some shopping, whether it's back to school shopping or need a new sweater to wear to work, that they'll think of the brand and keep it in mind. Of course, too, the brand will be following up via email. If they're having a big sale, maybe they'll follow up and send over some special deals. I know I've certainly had this experience where I've gone into a store, tried on a couple things, not bought anything, and then weeks and months later gotten an email about a sale or a promotion and then ended up buying something.

It's really about building these long-term relationships rather than just making a sale day of, it's really about this ongoing relationship that I think the brands imagine will happen largely online in the future.

Matt Katz: Lora, we're going to take some callers. Lisa in Westfield, New Jersey, you're on the air. Hi, Lisa. Thanks for calling in.

Lisa: Hi. How are you? You're actually helping me not feel so guilty about not supporting local stores. I tried very hard to go in brick-and-mortar to buy a dress for my son's wedding. At my age, I'm 71, everything was strapless, cut out. It was inappropriate. I ordered nine dresses online from three major department stores, tried them on in my bedroom, called my husband in, had a look, found my dress. I would not have found it had I gone into the stores because I really tried. Now, my husband needs a suit.

Instead of schlepping to Short Hills Mall and knowing that we're not going to find his size, we've ordered five suits. You're making me feel less guilty about shopping online.

Matt Katz: Yes. Lisa, you're part of this-- You're experiencing this trend here. That's really interesting, Lisa. Also, congratulations on your son's wedding. That's wonderful. Lora, talk to Lisa. There's just less selection in the brick-and-mortar stores.

Lora Kelley: Yes, absolutely. Congratulations to your family. That's so interesting you say that. My mom had the same experience last summer. When my brother got me married, she went over to the local mall, expecting she may see a bunch of great options, and she ended up also having a really hard time finding things because a lot of stores don't have as much merchandise in stock. Well-meaning salespeople may point customers to shop online. Yes, I do think that there are things that are convenient about shopping online, but some of the experience really is lost.

It is great to be in a store, try on a lot of things, and discover new things. It is a pretty big shift to the retail experience. I definitely hear that, and thank you for sharing that.

Matt Katz: Yes. Thanks for calling in. All right. We have Wendy in Peekskill. Hi, Wendy.

Wendy: Hi.

Matt Katz: Hi, Wendy. Wendy, if you're there, you're on the air. Oh, okay. Well, Wendy's not there. By the way, Lora, we're getting a bunch of calls and texts from people with this same experience, also specifically son wedding experience and trying to buy dresses. Is this more of an issue for maybe older people where the styles and the selections in the brick-and-mortar retail outlets are geared toward a younger crowd and older folks who are looking for maybe a little bit more conservative wear have to go online?

Lora Kelley: Oh, it's such an interesting question. I'm not sure about that specific demographic, but I do imagine that-- This is a pretty big shift from how people shopped a generation ago. I definitely see how for shoppers who maybe were accustomed to walking into, whether it's a Nordstrom or a Macy's or insert the large store or department store at the mall, this is a pretty different experience. It's not the case that you'll see these racks at an enormous store. Overall, these stores really are a lot smaller. We're seeing retail leases shrinking for stores, and that just means that there are really fewer options for all sorts of shoppers.

Matt Katz: Looks like we got Wendy back. Hi, Wendy in Peekskill. Thanks for staying on with us.

Wendy: Can you hear me now?

Matt Katz: We can, yep.

Wendy: Great. Thank you for taking my call. My comment was that I'm a professional woman. 5'2 and a half, and a half is very important. I have a very difficult time finding petite specifically business casual because they won't come in the stores. It's difficult for me to purchase online because, unfortunately, I'm big busted, but short. It's a difficult situation to find anything. To have to order is time-consuming for me.

Matt Katz: You'd prefer to be in the store, have a large selection of different sizes, and sit in the dressing room with five shirts, and try them on, I imagine?

Wendy: Exactly. Yes. Exactly.

Lora Kelley: Yes, so interesting. It's one of those things where my understanding is that for the stores, it's more efficient. It's cheaper for them to get a smaller space that maybe has a lower rent. It's cheaper for them to hire fewer employees and have fewer items in store. Definitely, there can be something lost for the consumers. Something interesting that I found in my reporting was this is an overall trend that we're seeing a lot of stores get smaller and open, smaller outposts.

But some retailers are moving the opposite direction, and particularly high end retailers, like Gucci, Chanel, and some of these really luxury retailers are really investing in these large flagship locations. It is really true that for most American shoppers, there are fewer options when they walk into a department store or mall or just a local shop.

Matt Katz: It's The Brian Lehrer Show on WNYC. I'm reporter Matt Katz, filling in for Brian today. My guest is Lora Kelley, an editor at The Atlantic. We're talking about how the in-person shopping experience has changed. We have a report from on the ground. Eric in Mount Olive, I understand you're a Macy's retail associate. Hi, Eric.

Eric: I work as a remote digital stylist. What I'm finding is that when the position was first created during the pandemic, a lot of the customers had no choice but to shop online because most of the stores were not open. Now, we're finding that a lot of customers that are actually coming in, are actually looking for customer service related issues, and they've already made their purchases online or they've already made their purchases in stores. Also, I want to make a quick comment about the lady who spoke earlier about petites.

I had tons of customers that are looking for petite. They come in, asking about availability of product in that size range. My experience when I was working in merchandising for a different company, you're not going to find a lot of inventory in stores for petites anymore because it creates a lot of markdown. The merchandising staffs do not want that much inventory in stores because of that. They're trying to get out of inventory faster now and have inventory linger for a long time.

Matt Katz: That's really interesting. Thank you very much, Eric. Really appreciate it. Lora, what do you make of that?

Lora Kelley: Yes, that is so interesting. Thank you so much for sharing that. That's especially interesting what you noted that a lot of the people who come into the stores lately are people who have maybe made a purchase online and are really looking for customers service. That's really so interesting that it sounds like a lot of the service that people are providing in retailers these days are helping with customer interactions or maybe things like returns or issues with a piece of merchandise. Thanks for that.

Matt Katz: We're getting a lot of texts from people complaining that they don't like the smaller stores, and particularly from plus-size shoppers. This is one text. "As a plus-size shopper. I hate this shopping shift. It was already difficult to find my size in stores, and now, it's virtually impossible. It's also difficult to tell fit from the online models. Finding well-fitting and fashionable clothing is increasingly challenging." Did you know that, Lora? Did you come across that issue and that complaint?

Lora Kelley: Yes, that's so interesting. Thank you for sharing that. I think it is really a lot harder for people to find a range of sizes. If on the shopping floor, there's one or two sizes that are available. It doesn't do customers who are not that size a ton of good to hold up a sweater. Because so much, as you said, of the shopping experience and of getting clothes that you feel great in is about the fit. That's really something you can only see by getting something that's in the right size and seeing how it falls on your body, how the material feels. Yes, there is definitely something lost in that sense in the smaller store setting.

Matt Katz: We have a new perspective from Jeremy in Brooklyn. Hi, Jeremy. You're a store owner?

Jeremy: Yes, that's right. Thanks so much for taking my call. My wife Jillian and I own a small furniture and housewares shop in Cobble Hill, Brooklyn. Because we're a brick-and-mortar location, brick-and-mortar is more important to us.

Matt Katz: More important to you than online?

Jeremy: Than e-commerce. What we found was, during the pandemic, of course, being a non-essential business, we were closed for those three, four months. Now that COVID is over for all intents and purposes, we're seeing an increased amount of in-person traffic. The business that's happening is because people want to stomp in, sit in a chair, feel the material, see what something is like in person. Our store is super small. Some people call hyper-curated. We like to say it's all killer, no filler. It is incredibly important that people stop in and see things.

Matt Katz: Do you have an e-commerce component of your operation still?

Jeremy: We do. We use social media, we use Instagram in particular, which was, as I said, was hugely popular during the pandemic because people were home and scrolling. We do have a website for the store, so that when people are at home, they can see photos of different pieces. They have the measurements available to them there. What we've found is that really, people are stopping in now. The website is just an afterthought for most folks.

Matt Katz: Shopping is also an experience, right, Jeremy? I mean, people might go to lunch and then want to walk to some stores in Cobble Hill, I imagine.

Jeremy: Without question. We're on a gorgeous little block. Cobble Hill is what I like to call Brooklyn's West Village. It's such a beautiful little neighborhood. Our store is quite bright. There's an emphasis on bold color in our upholstery choices and our artwork and that kind of thing. I think it's quite enticing. We're close to the Trader Joe's on Atlantic, and so people strolling to get their groceries on Saturday, might stop in window shop, but then with their arms loaded with bags, they need to put things down and take a break, and they'll stop in on their way home.

Matt Katz: Jeremy, give us a plug. What's the name of your store?

Jeremy: We're Cabin Modern.

Matt Katz: Thanks for calling in, Jeremy. Appreciate it. I'm thinking, Lora, about this, when you're going into a store and then you buy you, instead of going into the store, let's say you're buying online and the T-shirt doesn't fit, and then you send it back, and then they send you another one and you don't like the color. I mean, the environmental impact of the online experience compared to the retail experience of walking over to Jeremy's store in Cobble Hill and walking out with a small household item, the disparity there is great.

I mean, I could get a T-shirt shipped to me and I don't like it, and I send it back and it goes back and forth three or four times. The Amazon truck is idling outside my place while delivering and picking up the packages. I mean, that's a lot from an environmental standpoint?

Lora Kelley: Yes, absolutely. Well, first of all, Jeremy's store sounds wonderful. I'll have to stop by next time I'm walking around in Cobble Hill. Yes, definitely. It's a lot less efficient. The environmental impacts of returns are great. The way that I think about it after reporting this article is that in a lot of ways, it's more efficient for the retailer. From their perspective, they save money. They have to bring in less merchandise for the shop floor in their physical locations, but it is often inefficient for the consumers if they write, order something and it doesn't fit right, and they have to send it back and go do this whole back and forth.

To Jeremy's point about the store experience, that does sound like such a fabulous retail experience. I think that is something that really is a positive for consumers and for shoppers in this trend is that, it often is wonderful to go into these stores. I know when I'm walking around in SoHo on my lunch break, there are so many beautiful stores. Even if I'm not necessarily going to be purchasing items at these luxury retailers very often, it is really amazing and inspiring in some ways to see all these beautiful items, to see them laid out so carefully and thoughtfully. It is a fun consumer experience often to go to these stores.

Matt Katz: Lora, where are we going with this? What do you think the trend is? Do you think brick-and-mortar stores and these smaller stores continue to pop up all over the place? Are they here to stay? Does that affect online retail in some way? Tell us about what you think is going to happen going forward.

Lora Kelley: Yes, so I think the way that one professor I was speaking to about this put it, is that we're still at the beginning. I think it is the case that the era of the giant mall, Macy's or Nordstrom, I think that is behind us, and probably that exact model, with certainly some exceptions, probably at various malls. That's probably not going to be the way people shop. The way that I see this going from the interviews I did, is that we'll really continue to see in-person retail that complements online retail.

I think just even looking at the trend of Amazon, Warby Parker, and these businesses that started online only, a lot of them have opened up in-person stores, which does suggest that there is value to the in-person experience, whether it's everything from having some merchandise laid out to giving consumers a place to do returns. There is real value in the physical store. Frankly, even just as marketing for a brand. If a lot of people walk by a store, they may remember it or form a good impression.

There definitely is a place for online retail, but we probably will continue to see more of these stores that really go hand in hand with the e commerce stores. These smaller stores around the country in various neighborhoods and areas that work closely with the e-commerce stores. You may be able to pop in and then order something online.

Matt Katz: Now, I just want to go window shopping. Thank you very much, Lora.

Lora Kelley: Thank you so much for having me.

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