Okay, take a breath, we all know the economy is poor, the unemployment rate is rising and homes are going into foreclosures…retailers like Chicken Littles are running around crying “The sky is falling! The sky is falling!”

Retailers (especially those who over-expanded) will be closing their least profitable locations. Does America really need a Starbucks and Duane Reade on every other corner? After all, how many cups of grande Sumatra roast and bottles of avocado crème rinse can we consume? Some retailers will disappear forever into the Valhalla of retail. Like kingdoms where the bloodline ended, when Bonwit  Tellers, Orhbach’s, S. Klein and Abraham and Strauss went out of business, the world did not collapse, other merchants merely rose in prominence. While retailers will scale back, here is the good news… Indeed, they will be in fewer locations, but, (and it’s a big but) they will re-emerge in better locations, with larger, more attractive stores, and they will lock into longer leases as rents have been reduced. In order to attract customers back into shopping, stores will become destination sites, more attractive  environments will need to be created and customer service will be enhanced (however, how much further backwards Nordstrom’s can bend is TBD).

To illustrate my point, despite the sour economy, two brave retailers Diesel and Armani, just opened their over-the-top U.S. flagships on toney Fifth Avenue, New York, within one day of one another. (Tommy Hilfiger and Top Shop will also open shop shortly.) I quote…“Wouldn‘t you like to be my neighbor?” a la Mr.Rogers. Both Diesel and Armani are brilliantly executed stores, both different as night and day. Both, by all appearances, promise to be successful.

Diesel fuels Fifth Avenue with startling window displays. While possibly counter-intuitive, there is no product in the window, no mannequins, not one pair of distressed jeans. The windows represent a slice of life apartment, where their iconic, colossal-size, bronze punk head has just been hurled through the ceiling, and has now exploded. The apartment is a shambles. Post 9/11, it commands your attention. Once entering the store, a live DJ is playing rap as loudly as it might be heard at Webster Hall. Kids are absorbing Neo like a sponge. There are beautiful museum-quality-framed prints of Diesel’s sexy advertising hung over leather couches. There are coffee tables and potted orchids to remind you of some swanky party you were once invited to. You almost begin to wonder, “Where am I, is this a jeans store, it’s too luxurious?” Natural light filterers into the store, bringing the glamour of Fifth Avenue right into the interior, at night the neon street sparkles. Jeans, which are plentiful, are hung, folded and draped as if they were made of Persian silk. The different washes of denim blue run from the color of the Aegean Sea to the color of the night sky in Nantucket. Like a zombie, you find yourself aimlessly walking into the dressing room with three pairs of low-rise boot cut jeans. I think the air is filtrated with Absinthe.

Also strong-arming, Armani, just two short blocks away from Diesel, presents the diametric opposite aesthetic. The exterior of the store is swathed in a perforated sheet of black polished steel; light from behind illuminates it like your kid sister’s old “Light Bright” game. The staircase is elliptical in shape, and from the upper floor clearly reiterates the feminine shape of a women’s strappy stiletto. The stairs are illuminated in radiant white phosphorus, much in the same way I imagine that the steps to the Pearly Gates may be. Balancing the whiteness of the architectural staircase is a predominance of black, Armani’s signature color. It is not one shade of black–there are 96 shades of black, yes, I counted them. Ad Reinhardt would not only be impressed, he would have taken copious notes. The fixturing is as modern and sleek as a Porsche or Ferrari. I have to give it up to those Italian designers. The white marble floor creates a sinuous ice skating rink, and you will be doing figure eights in the couture department wondering how many books of S & H Green Stamps you would need to collect to pick up a frock. There are several floors, each so impressive you will venture into departments where you have no business to be.

If you do not trust my opinion, please note that the reviews are universal. Retail is alive and well, and living in New York City.

–Ron Knoth, Guest Blogger