Why festive store windows are still prime real estate

Shopping during the holiday season has changed dramatically in the last decade, with retailers transforming their business models to cater to the shift online.

December 18, 2018

But amid the tumult, one seasonal tradition has remained constant: Dressing up storefronts with festive decorations.

This year, Bergdorf Goodman on New York’s 5th Avenue opted for an ode to sweet treats. Bloomingdales took a spin on Dr. Suess’ The Grinch. Macy’s in Chicago went with a tribute to the holiday season itself.

The traditions of decorating windows goes back over a century. But the reason is much the same: to encourage customers to pay a visit.

“Window displays are valuable in the corridors that have high foot traffic, like Fifth Avenue in New York City,” said James Cook, who directs retail research at JLL.

Tis’ the season to go shopping

For retailers looking to maximize sales with the enormous segment of visitors spending a serious amount of time strolling along major U.S. shopping corridors, it still pays to invest in a little holiday cheer.

New York City’s Fifth Avenue is a perfect example of the kind of prime urban corridor characterized by a mix of high street, national and international tenants.

Visitors spend an average of 151.1 minutes shopping on the street, according to a study by JLL and Alexander Babbage, which places it among the top retail corridors in the U.S. when it comes to length of stay. Metro Center in Washington D.C., however, holds the trophy with an average of 181.9 minutes. Unsurprisingly, it is also a major destination for holiday windows.

The of high foot traffic and a long time spent browsing that create lasting impressions for brands with decked out windows, Cook says.

Good to be different

In these prime retail corridors, the competition amongst retailers, especially iconic stores like Macy’s, Nordstrom, and Bergdorf Goodman in New York City, reaches fever pitch at the holidays. Planning for elaborate window and in-store displays begins months in advance and accounts for the biggest expenditure in those companies’ visuals budgets.

While the return on investment on, say, the multi-story sculptural candy tower that is currently on display at Bergdorf Goodman’s New York City windowfront, retailers have noticed a correlation between increased foot traffic outside holiday window displays and engagement with their brands.

“At a time when retail ebbs and flows in all directions, I think there is a natural orientation to pull back on things,” Darcy Penick, the new president of Bergdorf Goodman, told the New York Times. “From my perspective, that’s not what drives customer love for your brand. You keep investing in the things that your customers love.”

The brand promise of visiting Bergdorf’s licorice carousel window does not end with the visit alone.

“These corridors are global tourist destinations and significant social media hotspots,” says Taylor Coyne, Research Manager of Retail for JLL. “The store windows and other Instagram-ready displays take on a life of their own online.

Even Henri Bendel, whose owner L Brands announced it would shutter all Bendel stores, and at Lord & Taylor, which sold its flagship Fifth Avenue store, the window war rages on for at least one more season. At Bendel’s, a motif featuring the store’s signature striped hatboxes delighted droves of shoppers, even going viral across the store’s social media platforms.

“As expensive as retail rents might be on these prime corridors, thanks to the high volumes of foot traffic, the cost per marketing impression is a fraction of what a retailer would pay for the same level of paid social media engagement online,” Cook says.