Can a Shop Truly Be a “Third Place”?

0:07Hello and welcome to The Debrief from the Business of Fashion, where each week we delve into our most popular BOF professional stories with the correspondents who created them. I'm executive editor Brian Baskin. And I'm senior correspondent Sheena Butler-Young. From listening bars to in-store cafes, retailers are chasing a big idea. Can a shop double as a spot to linger, meet, and belong? Coined by sociologist Ray Oldenburg, the term third place describes all of the above except for commerce. But post-pandemic, with social isolation up and footfall down, brands are trying it on anyway, measuring their success not just by sales, but by dwell time, loyalty, and word of mouth.

0:48BOF retail editor Kat Chen has been reporting on the third place wave and has seen firsthand what's working, what's performative, and is asking the big question whether stores can ever really build a true community. Kat, welcome to the Debrief podcast. Hi, guys. Happy to be here. So Kat, when Oldenburg initially envisioned this so-called third place, I don't imagine he was picturing, you know, this being having a backdrop of lip gloss, denim, dresses, and all of those things. What did he initially have in mind? Yeah, I do want to disclaim that this is like a very bastardized version of what Ray Oldenburg was picturing.

1:28So a third place has a very simple definition. It is a place that is not the home, the first place, and not work or school, the second place. A third place is a social place where people can simply hang out. So it could be a local bar, a local tavern. He was imagining maybe a barbershop. It could be a youth center, a pool hall, a library, which are a lot of places that have actually been disappearing in the last couple of decades. Even at the time when he coined this term in the late 80s, 1989, a lot of these places had already been disappearing. And what exactly are stores doing now to try to fulfill this mission of a third place that they maybe weren't doing five or 10 years ago?

2:25I would say taking a pretty literal interpretation of creating spaces where people can physically linger. So seating areas and offering food and beverage. Of course, F &B, you know, is not a new thing. Many, many brands have been doing it for a long time. Dover Street Market has done it well for a long, long time. But now there's a, you know, it's really a new mindset of not creating food and beverage as a destination, but as a way to get people to sort of simply spend more time in the store. It's a very subtle thing. And I think when it's done well, it's authentically creating a community. When you mentioned, you started to sort of infer what success doesn't look like or why this doesn't always work.

3:28It made me think about a certain sneaker retailer pre-pandemic that invited me to like an experiential store opening that was going to be a community hub. And I'm pretty sure that store no longer exists. Now I get that the need feels more urgent, but where were those first iterations going wrong? I don't think this has more potential to work now. I think the idea of a third place as a way to drive sales for retailers is an unproven theory. I don't know if it can be successfully proven in retail at all. And I think that experiential retail is also unproven. We don't know if it doesn't work. We don't know if it does work.

4:12And experiential retail is also another one of those very abstract ideas. right? Is it good service or is it something novel that makes a store a destination? Well, Oldenburg had a lot to say about this exact question. And you alluded to this before, which is that the goal with all the food and drinks and all the bells and whistles in these stores is to get you to stay in the store longer. And we all know, if you're listening to this podcast, you probably know the longer you spend in a store, the more likely you are to buy something or to tell your friends and they come to the store and they buy something too.

4:49And Oldenburg said essentially that commerce was corrupting. It wasn't a true place outside the home or work if the goal is to spend money and not to socialize. Is that basically what the fundamental issue is here? Oldenburg had a problem with the scale of commerce. So he believed that an independently owned and a locally owned shop can be a third place, in fact. But a mall cannot be a third place. Because one of the tenets of being a third place, and if you look at the nifty graphic that our BOF studio whipped up for us, you can see that one of the key components of a third place is interactions with strangers.

5:37strangers and when you when you go to a mall you go to a mall to either hang out with your friends which is great that's a third place and malls many malls you know I would think by a loose definition of third place can be a third place but you know you're you're not really going there to to interact with a stranger and the beautiful thing about you know your sort of local store or your local cafe is that you know the baristas over time you become friends or you become friendly Lee with the sales associates or maybe even the owner of that. And with these big chains, you don't really know who's behind the chains.

6:16And so I think it's tricky because it's not just about the commerce element. It's about the scale of commerce. And I think that's an important distinction. So I get that brands are sort of taking bits and pieces of what Oldenburg came up with as this third place and kind of putting their own spin on it. What are some of those things that are on? I think you called it the dashboard in the story, or maybe we're calling it the dashboard, but what are they actually saying that this is going to do for them and how are they measuring it? What's the KPI? Is it this thing, the dwell time thing that you mentioned?

6:49What are they looking to do in their version of a third place? Yeah, it's definitely dwell time. In my reporting, there was one statistic that was repeated over and over again is that for every minute increased, there was like a 1.6 % increase on sales likelihood or something. The source of it was from a very, very old study. And so I didn't include it in the story because I was like, everybody is citing this. And so So it makes sense that dwell time would increase sales conversion, but quantifying it, I think, is still very, very difficult. So there are companies that are sort of toying around with this idea of getting the dwell time higher, right?

7:40So you talked about a few of them in your story. One is the Western boot and clothing brand, right, Tecova's. So what are they doing? Because I personally am looking for the nearest Tecova store this weekend. Yes, we should all go to Tecova's together because it's so close to our office and they offer free drinks, which is not new. There's anyone who reported about their store opening in New York wrote about this, but I don't understand how it's not the lead to every story because they have this full bar inside their store. And actually, they have bars, I think, inside of all of their stores. And at these bars, they serve all of their drinks for free.

8:18and you can have as many drinks as you want. They're not going to cut you off. And Kat, when you visited the store in Soho, how many margaritas did you have? I did not have a single drink at their store opening because I was headed to another event, but I promised them that I would take you guys to the store and we would test the theory. We would test the theory. And I was like, okay, but you guys cut customers off, right? And they were like, no. And I was like, but you guys have had incidents, right, where surely there's, you know, there's trouble with that. And they were like, no, our customers are very polite.

8:56And I was like, but surely this is a big cost item for the brand, right? And they were like, well, it's an operating cost like any other operating cost. And so this strategy is working for them. And it's part of their retail strategy that's called radical hospitality. and it's this idea that when someone enters their store, they're not making this pitch of like, oh, what are you looking for today? What's your shoe size or, you know, whatever. It's more like, hello, how are you? Come inside the store and the store is set up in a way where it's like there's a huge lounge section that is very visible to the shopper and the idea is like they're inviting the shopper into the living room of the founder of the company and they're inviting the shopper in to hang out for a while and have a drink and then they can maybe buy a pair of cowboy boots i can't tell if this is like the buffet where if you just make it so plentiful people's like like their eyes or like your stomach is smaller than your eyes kind of thing or if this is actually like people just behave themselves and can have self-control it also makes me think about sephora and like where beauty might fit into this conversation of just making it a free-for-all like you can test and play and it seems to work out that they eventually buy but there's also like I'll say my own experience with like sometimes going into a Sephora it's like it's very clear people want you to buy like you're playing around with the blush and you're immediately a cop like do you what color do you want how do you avoid that part of it like because you do have to make a sale is it training your sales associate like how do you not go too far in any direction here I do think that there's a certain hands-off element, right?

10:37Like the times where I've definitely abused Sephora's policy of free samples and gone to Sephora just to redo my makeup. Like when I'm doing my thing, I would say the sales associates are pretty much like, oh, she's doing her thing. She's using the samples to redo her makeup. You know, people have stayed away from me. And so I do want to make the point that like the retailers that are best at being third places are not the ones that you think of. It's actually not Ralph Lauren. It's not Prada Cafe. It's not Tiffany and Blue Box Cafe. Like those are not the retailers that are the best third places, in my opinion.

11:16I think it is Sephora. Like I think Tekovas is onto something. I talked to a real estate broker for my story and he brought up the example of an Apple store because you can, Apple has this amazing policy, which I tested out in my reporting where you can just walk into an Apple store and be like, hey, I need to charge my phone. And you can just walk right in and they'll be like, hey, charge your phone here. And then you can just literally stand there for 20 minutes and charge your phone. And you can go in and be like, can I use your bathroom? And they just let you do that because they realize that when you have this really positive experience in their ecosystem, that you will feel very positively about the brand.

11:57That's so right. I mean, my first reaction when I read that in your story was, oh, brother, like that is really setting the bar for a third place pretty low. I can charge my phone here. And then I thought, what do I actually appreciate in public spaces? I like that there's a nice comfy bench when I'm out on a long walk and there's a park and like Apple is weirdly providing that service to people walking through a mall or through an outdoor shopping center. And, you know, you do have a positive feeling about a brand when they do something like that. And that probably outweighs the fact that there's some people in there who are never going to buy anything and they're just taking advantage of their free electricity.

12:32Totally. Which is another thing. Like, I think that if you're a struggling chain with a lot of stores, I'm not going to say who, I think a clever strategy might be you should start offering free public bathrooms. Like that is a public service. And that is a way to really start allowing people to have a very positive association with your brand. And that's exactly what Starbucks just did. I mean, they famously had those free bathrooms. They took them away. Sales are falling. One of the solutions the new CEO have is give those free bathrooms back. We get people back in the store. Exactly. Free bathrooms, free refills.

13:11And they explicitly use the term third place to describe adding these amenities back. So again, it's not about food and beverage. I think a lot of people make the mistake of, you know, thinking community and experience is about food and beverage. And it's not. Or sometimes maybe it's like you can have even mediocre food and beverage and that's okay. I mean, the concept of food and beverage in providing a third place is actually it's low commitment food and beverage. It's cheap food and beverage. It's low barrier to entry. So a cafe where you're serving, you know,$2 coffees, hopefully not, you know,$8 fancy matcha coffees or, you know, donuts and, you know, cheap snacks so that you're welcoming everybody into the space.

14:06There's been a lot of think pieces about private membership clubs popping up in New York and how this is tied to this desire for third places. and private member clubs are not third places. They are the antithesis of third places. For$20 ,000 a year in fees, you can have a nice place to build a community.

14:32We'll be back with more of the debrief right after this.

14:40I want to talk about something that one of your sources said in the story, which is this term of being branded to death. What does that mean? And how does retailers iteration of third place avoid being branding us to death? Yeah, I love this quote. I think it's our kicker. And this was with a designer, an interior design firm. I don't think he had even heard of third places before, but he immediately understood it, which I loved because this goes back to this idea of authenticity and understanding that community building is something that is authentic. and is not a branding exercise. And what he was talking about was like, you go to some kind of brands cafe and you're getting these like, you know, cookies with the logo on them and like everything is immaculately branded.

15:31And there is something, I guess, very satisfying about it. But at the end of the day, it's not about the social experience of being there. It's about maybe taking a photo of it. You know, and it's maybe about being able to consume this luxury brand that's akin to being the first step of being able to afford their$3 ,000 handbag. You know, again, it goes back to commerce. It's not community. It's commerce. And it's very much the opposite of what Oldenburg meant. Yeah. Yeah, just to lay my cards on the table here. I mean, the whole time I was editing your story and talking about this story, and even right now when we're talking about it, it's just so fucking depressing.

16:19Like the idea that we're going to find community in a store that sells boots or iPhones. I mean, why not just go to a bar or a coffee shopping? The fact that we feel in need. Your drinks are free at Tacoma's. That's why. I mean. Brian, I think you're being too cynical. I do. Okay. Me? Yes, you're still being too cynical because I too am skeptical, but I do think that a local community store, like there are stores in my neighborhood that can be a third place where I can go in, I recognize the owner, I recognize the woman who worked there on Fridays because that's the day that I usually go into the store.

17:02I can stay there for an extra 10 minutes talking to that person. Maybe one day they'll put a little cafe in that store. And I think it could be a third place. And actually, I think that retail is moving in that direction because like, think about the pieces that we've done on multi-brand, right? Now that department stores are faltering, all these local, all these regional boutiques are taking share. I mean, they're not taking all of the share and it's, you know, it's much smaller scale. But we are seeing this trend where these smaller independent players are emerging. And so I do think that retailers are onto something here.

17:47Yeah, they're onto the fact they have a new space to market to people. And I think that's what is at the heart of this. They're not doing this out of generosity or because they see there's a need for community. It's the reverse. They see there's a need for community and they realize they can capitalize on it. And I think in the end, that's why Oldenburg was so skeptical of the idea of stores as third places, because ultimately the motives aren't pure and that on some level ruins everything. I mean, that's Starbucks, but that's not the, you know, that's not the local shop owner. We will have no sponsors moving forward for the debrief after we're done with this one.

18:25I don't know if we had any to begin with. I just want to say, I think there's a middle ground, right? I think that we're giving, as brilliant as Ray Oldenburg was, I think we're giving him a lot of credit. I think there is a middle ground. Everything we just described about making this disingenuous or tainted by stores could be applied to concerts, could be applied to a lot of things that make us feel communal but cost money or have as an end goal money. I think my middle ground is like if you're a retailer in fashion and beauty and elsewhere and you want to also make money and make your store a community, I think they can go hand in hand.

18:59I think packaging it up as philanthropy is the problem. If you say you're doing both and I can come and get my margarita or old fashioned at the back and get my boots at the same time, I think you're all the more better for it. By the way, this is happening on the smaller local scale. I mean, I would urge our listeners to check out the Project for Public Spaces, the executive director of which I spoke to for my third places story. They're a very cool nonprofit organization that works with communities, local merchants, I think even bigger developers to create public spaces for local communities.

19:39They have guidebooks on how to create public spaces. They want to lobby public planners, city planners to create more public spaces. And that's exactly what they're doing. They're creating third places. They're helping private stakeholders to create more community hubs, you know. And so this work is happening. And so we can't be too cynical, Brian, because it's important. And, you know, the evil corporations, like, you know, they can also put resources toward this stuff. But I think we're talking about two different things here. I agree with both of you that a store can become a nicer, more welcoming store by introducing some of these third place elements.

20:26But we shouldn't confuse that with actually filling the void left by disappearing third places. That's my only point. I think it's lovely that these stores offer these things, especially the free drinks at Tecovas. I'm a huge, huge fan of that idea. but I just, I don't like the idea of combining the two. Fair enough. So I will meet you at the barbershop or library after this, Brian. With that, let's switch to our lightning round. Okay. So I think all of us should take this question. What is the most overdone third place prop? I can go first. I think it is the coffee machine thing. Like I know that's not a prop because you can actually have coffee, but I just think it's such, it's so low, low hanging fruit.

21:09Like I like to walk in with my coffee oh i agree that was that was gonna be mine i mean coffee where do you find it everywhere like why do i need to get it at the store where i'm buying my uh my shoes i'm gonna say boyfriend lounges just to be different what is a boyfriend i don't know you know like the couches for the boyfriends and the husbands oh oh god yeah yeah deep deeply homophobic that one they're so gendered like it's so so gendered agree i agree with that one all right next up the one hospitality Potality queue many store teams could adopt tomorrow. I have great experiences in Sephora most of the time, but I did go in a couple of times during Fashion Week, like in between shows, like to do a quick touch up.

21:51And I found that the salespeople at the location that I went to were overly anxious about asking me what I was looking for when I was just clearly doing a touch up. So much so that I bought two things I didn't really need because I felt pressured. So I think what is missing from stores in general, I think, is the training of sales associates to actually engage with your customers in a meaningful way, sell to them without making it feel like they're being sold to. I'll go with keeping a store neat and tidy and welcoming in a design sense. I still think that's pretty rare. It's less rare than it used to be.

22:28I will say I go to the mall now and like most stores, even even chains you think of as struggling and, you know, kind of low end, like they kind of know how to make a store feel like it's not a total disaster. But there's work to be done to make it feel like a place you want to spend time, which, again, is a key part of this whole concept. Oh, there's so many, like maybe even the opposite of you, Sheena. Just like be nice to me. Don't ignore me. Maybe anticipate my needs a little bit. I'll give you a positive example of this. I went to Prontan the other day holding a big bag. Someone actually came up to me and was like, do you want me to take that and give you a coat check tag and you can pick it up later?

23:10And I was like, oh my goodness, like that was awesome. But just more of that, like anticipating need, that would be great. Like that's something that pretty much every retailer is failing at. Free up your hands so you can buy more stuff. Yeah, exactly. Exactly, exactly. I've weirdly found Uniqlo is very good at that. You know, they do the thing where if you have a bunch of stuff, they'll offer you a bag. They help you check out, but they're not too pushy about it. Like, I think it can be done at every price point. Oh, yeah. Uniqlo is really great. Oh, and another thing is consistency. Like, I find that in New York, a lot of service can be really inconsistent.

23:47And I don't understand how that happens. And then the last one is one brand or category that should not attempt a third place and why it might backfire. I can't think of very many. I almost thought about like a big box store, but then I said, actually, that's probably a place that could do it. Maybe not. If you ever think about third places being philanthropic or charitable, maybe, maybe a big box shouldn't do it. actually yeah i was gonna say though my third place if i had to think about when i was a kid was probably best buy because you could play the video games i mean that's that's an example of what we're talking about right i would say like in and out places like it's super like utilitarian like if i'm picking up socks and underwear you know i don't want to dwell is cvs never going to be a third place yeah like a like yeah like a pharmacy like i'm picking up meds yeah wow i I could get my flu shot and a cup of coffee at the same time.

24:44And a drink. I don't know if there's no reaction. Oh, yeah. Why not get a drink? Two kinds of shots. Lost. Almost missed that one. On that note, this was a fascinating discussion. I like that we went deep here. I don't know that we ever came to an agreement. I don't know if I could ever be sold on this concept, but I appreciate the effort. Yeah, I never got to go on my diatribe about, you know, how everyone's afraid of strangers these days. but maybe, maybe another time. On the next episode of The Debrief, we delve into the roots of Kat's existential loneliness and Brian makes a drunken fool of himself that it's a COVID.

25:21I look forward to it. Thank you so much, Kat, for joining us. Thank you. Please be sure to check out Kat's article, Can a Store Ever Be a Third Place? at businessoffashion.com. These and other stores... You gotta be in a third place so bad.

25:41These and other stories are available to BOF Professional subscribers only, and you can find the links in the episode notes. You've been listening to The Debrief, produced and edited by Olivia Davies and Eric Bria. I'm Brian Baskin. And I'm Sheena Butler-Young. We'll be back next week with a new episode. Thanks so much for joining us and be sure to follow us wherever you get your podcasts.