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2016-5-13
India Shopping Centre Forum 2016
Marquee Keynote Speaker
Byron Lewis
2016-5-13
INTRODUCTION INTRODUCTION INTRODUCTION INTRODUCTION & AGENDA& AGENDA& AGENDA& AGENDA
About me
About Mall Solutions Europe
Retail is changing
What will the future look like
Technological innovation
Design concept stores
The rise of F&B
Game changing concepts
Q&A
2UNDERSTAND UNDERSTAND UNDERSTAND UNDERSTAND ‒‒‒‒ INNOVATE INNOVATE INNOVATE INNOVATE - DELIVER- DELIVER- DELIVER- DELIVER
2016-5-13
INTRODUCING INTRODUCING INTRODUCING INTRODUCING BYRON LEWISBYRON LEWISBYRON LEWISBYRON LEWIS
Successful retailer in Australia
Commercialisation revolution – Bluewater UK
Integral part of asset management in the UK
Mall Solutions Europe manages over £10 billion of assets
RICS Commercialisation Code of Practice White PaperFounding Chairman of the BCSC Commercialisation CommitteeEditorial Board for the Shopping Centre Magazine
2016-5-13
ABOUT ABOUT ABOUT ABOUT MSEMSEMSEMSE
Commercialisation solutions to leading retail asset owners
Embed professionals into existing management teams
Outsource to central teams
Consult on a wide range of commercialisation projects
Tailored solutions that optimise the potential of retail assets
All forms and aspects of commercialisation
UNDERSTAND UNDERSTAND UNDERSTAND UNDERSTAND –––– INNOVATE INNOVATE INNOVATE INNOVATE - DELIVER- DELIVER- DELIVER- DELIVER
2016-5-13
PAST PAST PAST PAST & CURRENT CLIENTS& CURRENT CLIENTS& CURRENT CLIENTS& CURRENT CLIENTS
2016-5-13
StoresStoresStoresStores
RETAIL RETAIL RETAIL RETAIL IS CHANGINGIS CHANGINGIS CHANGINGIS CHANGING
Rapid period of global commercial changeRapid period of global commercial changeRapid period of global commercial changeRapid period of global commercial change
Retail is central to that changeRetail is central to that changeRetail is central to that changeRetail is central to that change
2016-5-13
StoresStoresStoresStores
RETAIL RETAIL RETAIL RETAIL IS CHANGINGIS CHANGINGIS CHANGINGIS CHANGING
”””” We always overestimate the We always overestimate the We always overestimate the We always overestimate the change that will occur in the change that will occur in the change that will occur in the change that will occur in the next two years and next two years and next two years and next two years and underestimate the change that underestimate the change that underestimate the change that underestimate the change that will occur in the next ten. Don't will occur in the next ten. Don't will occur in the next ten. Don't will occur in the next ten. Don't let yourself be lulled into let yourself be lulled into let yourself be lulled into let yourself be lulled into inaction.inaction.inaction.inaction.””””
Bill GatesBill GatesBill GatesBill Gates
2016-5-13
GROWTH?GROWTH?GROWTH?GROWTH?
UK non-food sales, in-store and onlineUK non-food sales, in-store and onlineUK non-food sales, in-store and onlineUK non-food sales, in-store and online
£B
50
100
150
200
2015 2020
StoresStoresStoresStores
eComeComeComeCom
StoresStoresStoresStores
2015201520152015
2020 2020 2020 2020Source: Kantar Retail
2016-5-13
B2C e-retail as % share of total retailB2C e-retail as % share of total retailB2C e-retail as % share of total retailB2C e-retail as % share of total retail
RETAIL RETAIL RETAIL RETAIL IS CHANGINGIS CHANGINGIS CHANGINGIS CHANGING
20142018
GBR CHN KOR DNK USA JAP FRA NDL AUS ESP BRZ RUS GBR CHN KOR DNK USA JAP FRA NDL AUS ESP BRZ RUS GBR CHN KOR DNK USA JAP FRA NDL AUS ESP BRZ RUS GBR CHN KOR DNK USA JAP FRA NDL AUS ESP BRZ RUS INDINDINDIND IDNIDNIDNIDNSource:
0%0%0%0%
10%10%10%10%
20%20%20%20%
2016-5-13
GROWTH?GROWTH?GROWTH?GROWTH?
UK B2C e-retail sales UK B2C e-retail sales UK B2C e-retail sales UK B2C e-retail sales ££££bn % share (2013-18)bn % share (2013-18)bn % share (2013-18)bn % share (2013-18)
Source:
2016-5-13
GROWTH?GROWTH?GROWTH?GROWTH?
StoresStoresStoresStores
Source: Accenture Analysis of CapIQ, Internet retailer, Annual Reports
Ecommerce participation %
EBIT %
2006 2015
Sales online & EBIT, top 10 UK non-food retailersSales online & EBIT, top 10 UK non-food retailersSales online & EBIT, top 10 UK non-food retailersSales online & EBIT, top 10 UK non-food retailers
0
5
10
15
20
2006 2006 2006 2006 2015201520152015
2016-5-13
RETAIL RETAIL RETAIL RETAIL IS CHANGINGIS CHANGINGIS CHANGINGIS CHANGING
In 2015 Amazon spent $10bn on In 2015 Amazon spent $10bn on In 2015 Amazon spent $10bn on In 2015 Amazon spent $10bn on
R&D R&D R&D R&D
(circa 10% of revenues)(circa 10% of revenues)(circa 10% of revenues)(circa 10% of revenues)
Source:
2016-5-13
RETAIL RETAIL RETAIL RETAIL IS CHANGINGIS CHANGINGIS CHANGINGIS CHANGING
2016-5-13
RETAIL RETAIL RETAIL RETAIL IS CHANGINGIS CHANGINGIS CHANGINGIS CHANGING
Shopping Centre industry is under attackShopping Centre industry is under attackShopping Centre industry is under attackShopping Centre industry is under attack
What is the conventional world doing about it?What is the conventional world doing about it?What is the conventional world doing about it?What is the conventional world doing about it?
Source: Javelin Group
2016-5-13
DEADMALLSDEADMALLSDEADMALLSDEADMALLS.COM.COM.COM.COM
2016-5-13
DEADMALLSDEADMALLSDEADMALLSDEADMALLS.COM.COM.COM.COM
2016-5-13
DEADMALLSDEADMALLSDEADMALLSDEADMALLS.COM.COM.COM.COM
2016-5-13Source: Stephan D. Lebovitz – “Five trends that will change the future of shopping centers”
WHAT WILL THE WHAT WILL THE WHAT WILL THE WHAT WILL THE FUTURE LOOK LIKE?FUTURE LOOK LIKE?FUTURE LOOK LIKE?FUTURE LOOK LIKE?
2016-5-13
GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT CONCEPTCONCEPTCONCEPTCONCEPTChanging world of retailChanging world of retailChanging world of retailChanging world of retail
Internet revolutionizing how & where we shopDiverging models - rational and experience based shoppingDriving retailers to fewer but larger shopsWhat a shop does?
intu Eurofundintu Eurofundintu Eurofundintu Eurofund’’’’s responses responses responses response
Retail, entertainment & services hubCentred around stunning public spacesBringing together a sense of experience, a sense of placeCreating a place where people want to spend their leisure time
Create a SSSShopping hopping hopping hopping RRRResortesortesortesort
2016-5-13
Creating a Shopping ResortCreating a Shopping ResortCreating a Shopping ResortCreating a Shopping Resort
Make it emotional
Competing for people’s free time
Think family - think everybody
Think variety and think surprise
Create the family’s second spaceSomething for every family memberReduce the compromisesMake it a day out
GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT CONCEPTCONCEPTCONCEPTCONCEPT
2016-5-13Source: Eurofund Investments
GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT CONCEPTCONCEPTCONCEPTCONCEPT
2016-5-13
GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT CONCEPTCONCEPTCONCEPTCONCEPT
Source: Eurofund Investments
2016-5-13
GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT GLOBAL SNAPSHOT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT THE SHOPPING RESORT CONCEPTCONCEPTCONCEPTCONCEPT
Source: Eurofund Investments
2016-5-13
GLOBAL GLOBAL GLOBAL GLOBAL SNAPSHOTSNAPSHOTSNAPSHOTSNAPSHOT
TECHNOLOGICAL INNOVATIONTECHNOLOGICAL INNOVATIONTECHNOLOGICAL INNOVATIONTECHNOLOGICAL INNOVATION
2016-5-13
MACYMACYMACYMACY’’’’S AUTOMATED S AUTOMATED S AUTOMATED S AUTOMATED FITTING ROOMSFITTING ROOMSFITTING ROOMSFITTING ROOMS
Source: CBRE
Smartphones & tablets are used to request items from fitting rooms
Items are delivered through chutes
Focusing on a consumer led experienceFocusing on a consumer led experienceFocusing on a consumer led experienceFocusing on a consumer led experience
2016-5-13
HEADSPACEHEADSPACEHEADSPACEHEADSPACE
Source: CBRE
Personal interactive meditative pods
Designed to work with Headspace, a smartphone app
All-wood seat facing a screen, surrounded by a cube-like structure
Creating Creating Creating Creating zones for consumers to engage in dizones for consumers to engage in dizones for consumers to engage in dizones for consumers to engage in difffffffferenterenterenterent experiencesexperiencesexperiencesexperiences
2016-5-13
TORFSTORFSTORFSTORFS’’’’ INTERACTIVE INTERACTIVE INTERACTIVE INTERACTIVE TREND BROWSERTREND BROWSERTREND BROWSERTREND BROWSER
Source: CBRE
Interactive screens instore
Consumers can browse, check stocks and order
Linked tablets for kids
Focusing a consumer led experienceFocusing a consumer led experienceFocusing a consumer led experienceFocusing a consumer led experience
2016-5-13
TRYERS TRYERS TRYERS TRYERS SOCIALSOCIALSOCIALSOCIAL MEDIA RAILMEDIA RAILMEDIA RAILMEDIA RAIL
Source: CBRE
Social media likes and comments manifested instore
Likes and recommendations for items ranked instore
Visual representation of digital behaviour
Linking online and in-person shoppingLinking online and in-person shoppingLinking online and in-person shoppingLinking online and in-person shopping
2016-5-13
PLACEMETER PLACEMETER PLACEMETER PLACEMETER –––– FOOT TRAFFIC AND FOOT TRAFFIC AND FOOT TRAFFIC AND FOOT TRAFFIC AND CONVERSIONCONVERSIONCONVERSIONCONVERSION
Source: CBRE
Urban intelligence platform qualifying movement in cities
Uses any kind of video to assess pedestrian and vehicle movement
Video feeds are aggregated and sold
Understand flows and target relevant consumersUnderstand flows and target relevant consumersUnderstand flows and target relevant consumersUnderstand flows and target relevant consumers
2016-5-13
Mobile app using facial recognition for payments
Personal data and transaction data held in app
Smartphone is detected by Bluetooth at POS
Consumer’s face is recognised and payment processed
Enabling a positive & efficient consumer experienceEnabling a positive & efficient consumer experienceEnabling a positive & efficient consumer experienceEnabling a positive & efficient consumer experience
PAY PAY PAY PAY BY SELFIEBY SELFIEBY SELFIEBY SELFIE
Source: CBRE
2016-5-13
MITSUKOSHI MITSUKOSHI MITSUKOSHI MITSUKOSHI ROBOT INFORMATION DESKROBOT INFORMATION DESKROBOT INFORMATION DESKROBOT INFORMATION DESK
Source: CBRE
Humanoid employed on the information desk
Aiko Chihira speaks Japanese & sign language
Aiko reads facial features & gestures
Creating an exciting & stimulating consumer experienceCreating an exciting & stimulating consumer experienceCreating an exciting & stimulating consumer experienceCreating an exciting & stimulating consumer experience
2016-5-13
LOCAL LOCAL LOCAL LOCAL MEASUREMEASUREMEASUREMEASURE
Source: CBRE
Local Measure aggregates geo-tagged social media content
Gain fast & accurate consumer data
Highlighting what consumers are doing & saying in real-time
Ensuring that the consumer experience is tailored by Ensuring that the consumer experience is tailored by Ensuring that the consumer experience is tailored by Ensuring that the consumer experience is tailored by contextcontextcontextcontext
2016-5-13
GLOBAL GLOBAL GLOBAL GLOBAL SNAPSHOTSNAPSHOTSNAPSHOTSNAPSHOT
UNDERSTAND UNDERSTAND UNDERSTAND UNDERSTAND ‒‒‒‒ INNOVATE INNOVATE INNOVATE INNOVATE - DELIVER- DELIVER- DELIVER- DELIVER
DESIGN CONCEPT STORESDESIGN CONCEPT STORESDESIGN CONCEPT STORESDESIGN CONCEPT STORES
33
2016-5-13
O2O2O2O2
Source: CBRE
O2 opening ‘Apple’ type stores in UK
Roving experts
Technology workshops & themed interactive events
Creating a destinationCreating a destinationCreating a destinationCreating a destination
2016-5-13
SEPHORASEPHORASEPHORASEPHORA
Source: CBRE
12 beauty stations used for instore demonstrations
Mirrors & tablets allow consumers to watch tutorials
Experience shared with friends through social media
Linking social media with in-person shoppingLinking social media with in-person shoppingLinking social media with in-person shoppingLinking social media with in-person shopping
2016-5-13
LACES LACES LACES LACES SHOE STORESHOE STORESHOE STORESHOE STORE
Source: CBRE
New concept store aimed at young consumers
Mirrored walls with special edition items on central displays
Colour & quality of the products reflected back at consumer
Rethinking conventional designsRethinking conventional designsRethinking conventional designsRethinking conventional designs
2016-5-13
GLOBAL GLOBAL GLOBAL GLOBAL SNAPSHOTSNAPSHOTSNAPSHOTSNAPSHOT
UNDERSTAND UNDERSTAND UNDERSTAND UNDERSTAND ‒‒‒‒ INNOVATE INNOVATE INNOVATE INNOVATE - DELIVER- DELIVER- DELIVER- DELIVER
FOOD & BEVERAGE CONCEPTSFOOD & BEVERAGE CONCEPTSFOOD & BEVERAGE CONCEPTSFOOD & BEVERAGE CONCEPTS
37
2016-5-13
SPRING SPRING SPRING SPRING WORKSHOPWORKSHOPWORKSHOPWORKSHOP
Source: CBRE
Café & bar doubling as community hub
Offering apprenticeships & work experience
Literacy & coffee training
Profits donated to local charitiesCreating a focal point for the communityCreating a focal point for the communityCreating a focal point for the communityCreating a focal point for the community
2016-5-13
COSTA COSTA COSTA COSTA FRESCOFRESCOFRESCOFRESCO
Source: CBRE
Concept store for much larger hand-crafted bakery offer
Anglo-Italian theme throughout
Inspired by original Costa which offered freshly baked goods
Prioritise changing consumer desiresPrioritise changing consumer desiresPrioritise changing consumer desiresPrioritise changing consumer desires
2016-5-13
THE FUTURE OF THE FUTURE OF THE FUTURE OF THE FUTURE OF THE SHOPPING CENTRE THE SHOPPING CENTRE THE SHOPPING CENTRE THE SHOPPING CENTRE INDUSTRYINDUSTRYINDUSTRYINDUSTRY
Commercialisation revolution over last 20 years
Huge advances in ‘non-core’ income from common spaces
In 2000 commercialisation delivered £10m in UK
In 2015 approaching £400m
2016-5-13 41UNDERSTAND UNDERSTAND UNDERSTAND UNDERSTAND ‒‒‒‒ INNOVATE INNOVATE INNOVATE INNOVATE - DELIVER- DELIVER- DELIVER- DELIVER
MSE EXPERIENCEMSE EXPERIENCEMSE EXPERIENCEMSE EXPERIENCE –––– BEST IN CLASS BEST IN CLASS BEST IN CLASS BEST IN CLASS
2016-5-13
MSE MSE MSE MSE EXPERIENCEEXPERIENCEEXPERIENCEEXPERIENCE
42UNDERSTAND UNDERSTAND UNDERSTAND UNDERSTAND ‒‒‒‒ INNOVATE INNOVATE INNOVATE INNOVATE - DELIVER- DELIVER- DELIVER- DELIVER
Puerto Venezia, Zaragoza Puerto Venezia, Zaragoza Puerto Venezia, Zaragoza Puerto Venezia, Zaragoza – largest leisure and retail destination in Europe 206,000 m2
2016-5-13Source: ECE Market Research Destination Food
ECE ECE ECE ECE FOOD & BEVERAGEFOOD & BEVERAGEFOOD & BEVERAGEFOOD & BEVERAGE
Select by F&BSelect by F&BSelect by F&BSelect by F&B
Want Want Want Want fast foodfast foodfast foodfast food
Like food Like food Like food Like food courtscourtscourtscourts
Stay 15 Stay 15 Stay 15 Stay 15 mins+mins+mins+mins+
Stay 15 Stay 15 Stay 15 Stay 15 mins+mins+mins+mins+ Average saleAverage saleAverage saleAverage sale
F&B F&B F&B F&B every every every every visitvisitvisitvisit
Outlets in Outlets in Outlets in Outlets in ECEECEECEECE
Daily meals Daily meals Daily meals Daily meals per outletper outletper outletper outlet
Rate F&B mix as Rate F&B mix as Rate F&B mix as Rate F&B mix as goodgoodgoodgood
2016-5-13
THE FUTURE OF THE FUTURE OF THE FUTURE OF THE FUTURE OF THE SHOPPING CENTRE THE SHOPPING CENTRE THE SHOPPING CENTRE THE SHOPPING CENTRE INDUSTRYINDUSTRYINDUSTRYINDUSTRYGame changing concepts for Shopping CentresGame changing concepts for Shopping CentresGame changing concepts for Shopping CentresGame changing concepts for Shopping Centres
Unification of Bricks-and-Mortar and Online Retail
Unprecedented Intimacy with the Consumer
Conversion of Shopping Centres Into Communities
Mall Environments that Engage Millennials
Incorporating Distribution Into Shopping Centres
Accelerated Developer–Retailer Collaboration
Emergence of a New Blended Rental Model
Arrival of a Retail–Friendly Investment Outlook
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
UNIFICATION OF UNIFICATION OF UNIFICATION OF UNIFICATION OF BRICKSBRICKSBRICKSBRICKS’’’’NNNN’’’’MORTAR & MORTAR & MORTAR & MORTAR & ONLINEONLINEONLINEONLINE
Shopping Centres as e-commerce participants
Sophisticated websites
Onsite digital consumers interfaces
Mobile communications in the mall & beyond
E-commerce retailers are getting into bricks-and-mortar stores
Solidify brand
Curate product assortments
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
UNIFICATION OF UNIFICATION OF UNIFICATION OF UNIFICATION OF BRICKSBRICKSBRICKSBRICKS’’’’NNNN’’’’MORTAR & MORTAR & MORTAR & MORTAR & ONLINEONLINEONLINEONLINE
Hybrid form of commerce is emerging
Shoppers moving between digital and in-person shopping
Researching & experiencing products before purchase
Show-rooming is much talked about
Web-rooming actually more popular
90% of all US retail sales still occur instore
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Westfield Labs created in 2012Westfield Labs created in 2012Westfield Labs created in 2012Westfield Labs created in 2012Dedicated to digital innovationDedicated to digital innovationDedicated to digital innovationDedicated to digital innovationTicketless parking through smartphonesTicketless parking through smartphonesTicketless parking through smartphonesTicketless parking through smartphonesFood ordering appsFood ordering appsFood ordering appsFood ordering appsProduct finding and comparisons toolsProduct finding and comparisons toolsProduct finding and comparisons toolsProduct finding and comparisons tools
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
UNIFICATION OF UNIFICATION OF UNIFICATION OF UNIFICATION OF BRICKSBRICKSBRICKSBRICKS’’’’NNNN’’’’MORTAR & MORTAR & MORTAR & MORTAR & ONLINEONLINEONLINEONLINE
50% of all Westfield50% of all Westfield50% of all Westfield50% of all Westfield ’’’’ s retail purchases s retail purchases s retail purchases s retail purchases are influenced by onlineare influenced by onlineare influenced by onlineare influenced by online
Westfield London
2016-5-13
Beacons also have big implications
Compact, inexpensive Bluetooth transponders
Installed through malls & stores
Provide continuous connectivity with consumers
Empowering shopping centres owners like never before
48Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY WITH THE WITH THE WITH THE WITH THE CONSUMERCONSUMERCONSUMERCONSUMER
2016-5-13
Leveraging technology to embrace the human experience
Enhancement of customer outreach
Emerging technologies have potential to disrupt
Billion+ smartphones sold per annum now
Developers creating apps for “every imaginable use”
Including anytime/anywhere shopping
Location & movement data enable interactional context
49Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY WITH THE WITH THE WITH THE WITH THE CONSUMERCONSUMERCONSUMERCONSUMER
2016-5-13
Arabian Centres Company using mobile phones to track traffic patternsTo improve merchandising, revenue & amenitiesGather general demographic informationSend tailored offers to smartphones
UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY WITH THE WITH THE WITH THE WITH THE CONSUMERCONSUMERCONSUMERCONSUMER
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
Arabian Centres, Mall of Arabia/Jeddah, Saudi Arabia
2016-5-13
North American Properties undertook a ‘design-discovery tour’
Used Facebook for consumer feedback on various design features
Experiential retailers & restaurants can assist consumer intimacy
Leisure tenants are becoming more prevalent
Common spaces designed for recreation & entertainment
UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY UNPRECEDENTED INTIMACY WITH THE WITH THE WITH THE WITH THE CONSUMERCONSUMERCONSUMERCONSUMER
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Properties evolving into shopping, dining & entertainment centres
Centres must be more than ‘a distribution centre for goods’
Steiner & Associates are unveiling a mixed-use project in the US
Featuring parks, places of worship & a community event space
Centres to play a greater role in the cultural life of communities
CONVERSION OF CONVERSION OF CONVERSION OF CONVERSION OF CENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIES
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Successful events can drive significant footfall growthFrequent events in Santafe Mall, Medellin ColumbiaSo successful they can charge admissionHas become the city’s highest grossing mallFootfall has doubled in 4 yearsPeople can shop anywhere, anytime The experience makes the difference
CONVERSION OF CONVERSION OF CONVERSION OF CONVERSION OF CENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIES
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”Santafé Mall, Medellín, Colombia
2016-5-13
Shopping centre industry in the Middle East is evolving
Greater number of smaller-scale projects
Providing both convenience and a tailored retail experience
A notable shift from supercentre culture to smaller formats
Smaller formats will become more dominant
Meeting the needs of increasing urbanisation
Consumers’ changing notion of convenience
CONVERSION OF CONVERSION OF CONVERSION OF CONVERSION OF CENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIES
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Shopping centre industry in the Middle East is evolving
Greater number of smaller-scale projects
Providing both convenience and a tailored retail experience
A notable shift from supercentre culture to smaller formats
Smaller formats will become more dominant
Meeting the needs of increasing urbanisation
Consumers’ changing notion of convenience
CONVERSION OF CONVERSION OF CONVERSION OF CONVERSION OF CENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIESCENTRES INTO COMMUNITIES
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Provide a more customised, personalised appeal
Heightened coordination between developers and retailers
Creating a seamlessly attractive and entertaining environment
Commonalities among millennials have big implications
82% of millennials prefer to shop in stores
Although they spend a great deal of time online web-rooming
MALLS MALLS MALLS MALLS THAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALS
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Millennials are savvy, price-conscious shoppers
Placing a high value on experiences
Eating out experiences are valued highly
Proliferation of restaurant concepts
F&B represent 40% of planned opening for next year in US
Millennials are techies & foodies
MALLS MALLS MALLS MALLS THAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALS
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Millennials prize social responsibility & sustainability
Want to believe in the companies they patronise
Millennials are looking for high-value experiences
Millennials prefer city living as young adults
Mixed use schemes are preferred for family living
Providing job & social opportunities
MALLS MALLS MALLS MALLS THAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALS
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Mall Plaza in Chile has positioned its properties a social hubsGrowing economy creates more leisure timeUtilising enhanced mall appsAdding restaurants & amenitiesRelying heavily on social media to engage & build the brand1.5 million Facebook followersStreamed large-scale events
MALLS MALLS MALLS MALLS THAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALSTHAT ENGAGE MILLENIALS
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
Mall Plaza Egaña, Santiago, Chile
2016-5-13
Centres will combine retail with physical distribution points
Macy’s (US) fulfilment network includes all 800 stores
Shipping $1billion merchandise from its stores last year
Allowing ‘buy online, pick up in store’
Same-day delivery in 8 pilot markets
In US a group of centre owners have invested in Deliv Inc.
Using crowd sourced personnel to provide same-day delivery
INCORPORATING DISTRIBUTION INCORPORATING DISTRIBUTION INCORPORATING DISTRIBUTION INCORPORATING DISTRIBUTION INTO INTO INTO INTO CENTRESCENTRESCENTRESCENTRES
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Westfield London have a luxurious click-and-collect loungeIn partnership with CollectPlus, a parcel delivery serviceShoppers can order online for delivery to CollectPlus loungeEnjoy complimentary refreshments & try items onUnwanted items are returned & parking is free
INCORPORATING DISTRIBUTION INCORPORATING DISTRIBUTION INCORPORATING DISTRIBUTION INCORPORATING DISTRIBUTION INTO INTO INTO INTO CENTRESCENTRESCENTRESCENTRES
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
23% of customers purchase more items when collecting20% of customers purchase more items when returning
The CollectPlus lounge at Westfield London
2016-5-13
New paradigm for landlord-tenant collaboration
Sharing data & technology
Taking on Amazon together
Landlords & retailers are investing heavily in technology
Providing insights into shopper behaviour
Connecting the digital and physical worlds of retailing
Westfield app product-search feature
Digital storefronts – discover products in real time
ACCELERATED DEVELOPER ACCELERATED DEVELOPER ACCELERATED DEVELOPER ACCELERATED DEVELOPER –––– RETAILER RETAILER RETAILER RETAILER COLLABORATIONCOLLABORATIONCOLLABORATIONCOLLABORATION
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Westfield San Francisco MallWestfield San Francisco MallWestfield San Francisco MallWestfield San Francisco MallDedicated innovation & collaboration spaceDedicated innovation & collaboration spaceDedicated innovation & collaboration spaceDedicated innovation & collaboration space
““““BespokeBespokeBespokeBespoke”””” –––– 37,000 square foot facility 37,000 square foot facility 37,000 square foot facility 37,000 square foot facility2,000 square feet of demonstration space2,000 square feet of demonstration space2,000 square feet of demonstration space2,000 square feet of demonstration space3,000 square foot pop-up shop3,000 square foot pop-up shop3,000 square foot pop-up shop3,000 square foot pop-up shopCo-working and event spaceCo-working and event spaceCo-working and event spaceCo-working and event space
ACCELERATED DEVELOPER ACCELERATED DEVELOPER ACCELERATED DEVELOPER ACCELERATED DEVELOPER –––– RETAILER RETAILER RETAILER RETAILER COLLABORATIONCOLLABORATIONCOLLABORATIONCOLLABORATION
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
Bespoke co-working space, Westfield San Francisco Centre
2016-5-13
Rents will eventually be determined by new formulas
Current system based upon project sales
New flexible model incorporates online and in-store volume
Newly emerging hybrid-shopping patterns
Show-rooming & web-rooming
ICSC Report – Emerging Rental Models
In response to the evolution of omni-channel retailing
Physical store the cornerstone of omni-channel strategies
Far richer value than that of a mere point-of-sale
NEW BLENDEDNEW BLENDEDNEW BLENDEDNEW BLENDED RENTAL MODEL RENTAL MODEL RENTAL MODEL RENTAL MODEL
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
ICSC Report – hurdles
60% of retailers running separate profit centre for online
Many retailers yet to master omni-channel models
Costly and complex
Inventory management & fulfilment
Emerging ideas – new leasing modelsFixed rentsBase plus percentage rentsClick & collect sales percentage rentsIn-store online sales in the percentage rentsGeo-code models
NEW BLENDEDNEW BLENDEDNEW BLENDEDNEW BLENDED RENTAL MODEL RENTAL MODEL RENTAL MODEL RENTAL MODEL
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Alternative performance metrics
Measuring the delivery of the customer opportunity
Net shopping hours
Volume of customers
Conversion rates
Basket sizes
More refined metrics for quantifying purchases volumesWi-FiBeaconsSmartphone appsOther technology
NEW BLENDEDNEW BLENDEDNEW BLENDEDNEW BLENDED RENTAL MODEL RENTAL MODEL RENTAL MODEL RENTAL MODEL
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Investment in newly emerging shopping centre formats favoured
No existing performance benchmarks
Lenders are conservative and they want to see results first
Institutions favouring top-tier retail properties
Relative performance
Minimal development underway
High levels of reinvestment by owners
RETAIL FRIENDLY RETAIL FRIENDLY RETAIL FRIENDLY RETAIL FRIENDLY INVESTMENT OUTLOOKINVESTMENT OUTLOOKINVESTMENT OUTLOOKINVESTMENT OUTLOOK
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
“Tsunami” of capital” flowing into commercial real estate
Nearly 10% of portfolios into commercial real estate
Super-regional malls outperform other property sectorsNet operating income (NOI) growthLower level of NOI volatility
Lenders & investors increasingly more comfortable
Healthy balance between supply & demand in shopping centres
Realisation that centres are critical to omni-channel retailing
RETAIL FRIENDLY RETAIL FRIENDLY RETAIL FRIENDLY RETAIL FRIENDLY INVESTMENT OUTLOOKINVESTMENT OUTLOOKINVESTMENT OUTLOOKINVESTMENT OUTLOOK
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Exceptional personalisation and connection to the consumer
Creation of flexible formats
Better developer-retailer collaboration between
Fusion of physical stores and e-commerce
Re-evaluation of a new rental model
5 KEY 5 KEY 5 KEY 5 KEY TRENDSTRENDSTRENDSTRENDS
Source: ICSC Board of Trustees “The Future of the Shopping Centre Industry”
2016-5-13
Thankyou very much for listening!
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PRESENTATION PRESENTATION PRESENTATION PRESENTATION CONCLUSIONCONCLUSIONCONCLUSIONCONCLUSION