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10 of the Brands Shaping the Future of Shopping Centres How Insight and Innovation Are Changing the Shopping Centre Mix Inside and Out

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10 of the Brands Shaping the Future of Shopping Centres How Insight and Innovation Are Changing the Shopping Centre Mix Inside and Out 10 OF THE BRANDS SHAPING THE FUTURE OF SHOPPING CENTRES HOW INSIGHT AND INNOVATION ARE CHANGING THE SHOPPING CENTRE MIX INSIDE AND OUT In association with AT A GLANCE K shopping centres are increasingly shopping centre presence. Market Halls, on falling into one of two categories. the other hand, opened its first shopping On the one hand, prominent centre hall this summer at intu Lakeside. But regional locations are partnering what they share in common is a compelling Uwith a mix of established and up-and- proposition tailored to the changing way in coming brands to deliver a compelling retail, which people want to shop and socialise. food and beverage (F&B) and leisure offer. To help their retail partners grow, On the other, smaller schemes in secondary shopping centres will have to evolve to keep and tertiary towns are focusing on a value- up with the latest social and technological and convenience-led offer, often with the trends. Meanwhile, the retail and leisure presence of food operators as a crucial factor mix will continue to change at pace, in their appeal. with F&B and leisure operators becoming In both cases, landlords realise that more prominent. consumer expectations of the shopping Shopping centres will increasingly centre experience are changing. For flagship become their own digital ecosystems retail destinations in particular, shoppers with the development of cutting-edge expect more than a trip to the shops: they delivery services, loyalty apps and smart want theatre, entertainment and a fresh payment technology. surprise every time they visit – be it a new If landlords develop clear strategies and food brand, a pop-up shop or a one-off event. execute them well, they can be confident of The 10 brands we have identified as attracting the brands that consumers expect helping to shape the future of shopping to see long into the future. This is key as it’s centres are at different stages of maturity. not enough to keep pace with new trends – a Costa Coffee now has well over 2,000 core compelling retail offer is vital – these outlets across the UK, including a growing are shopping centres, after all. WHAT DOES THIS REPORT UNCOVER? ! 10 brands helping to shape the future of shopping centres ! How shopping centres are evolving their ofer to remain relevant ! The success to be had mixing bricks and clicks ! Why retail theatre and the latest in leisure are so essential ! How to use technology to boost loyalty and track customer spend RWRC CONNECT: 10 OF THE BRANDS SHAPING THE FUTURE OF SHOPPING CENTRES Acting Head of Commercial Acting Commercial Production Editor Business Development Manager Content Operations Rebecca Dyer Blaine Tulley Abigail O’Sullivan [email protected] 020 3033 2935 020 3033 2940 [email protected] abigail.o’[email protected] Contributors Rose Bundock, Rachel Horner, Nick Hughes, Judy Kenny, Adam Richmond, Ben Sillitoe, Eleanor Smith Data supplied by Local Data Company 2 | October 2019 In association with PARTNER VIEWPOINT WHAT’S IN STORE FOR RETAIL LANDLORDS? MATTHEW ROBERTS INTU CHIEF EXECUTIVE he active companies featured in such as direct retail stores owned and run this report are just 10 examples of by intu, curated spaces for street food, what we are seeing from many of experiential markets and paid for in-centre our customers. They demonstrate instagrammable experiences. Tthat whatever we read in the papers, there With only about half of our out-of-town are plenty of brands winning in retail today. estate currently developed, there is a lot And they will continue to want to be in more space we can capitalise on. We are bustling shopping destinations that millions looking at an intensification of our land of people visit every year. with an initial focus on residential, hotels Yes, the market is rapidly evolving, and and flexible working. we must all evolve with it, but the right stores in the right locations continue to play Thriving communities 90% of sales a vital role for retailers, with 90% of sales This will create thriving communities still touching a physical store (CACI). around our centres, ensuring residents can intu owns the best centres in each region benefit from everything they have to offer still touch a we trade in and, of those, nine are in the top and provide an extended catchment right 20 UK centres (Global Data). on the doorstep of some of the UK’s most Successful retail destinations must popular retail destinations, starting with physical store continue to evolve to maintain their intu Lakeside. relevance, attract visitors from far and wide, Relationships are also changing. With a and ultimately enable the brands within sharpened focus on our brand customers, them to thrive. we want to ensure their intu locations are their most successful. Understanding their So much more still to come changing business models is crucial and For us that means a number of things: the sharing data and insight will be fundamental continuation of our approach to deliver to these collaborative relationships. theatre and world class service; and at While there are still considerable the same time, reviewing opportunities to headwinds, we are continuing to focus on incorporate communities, hotels, flexible the day job at hand, which is to entertain the working space in and around our flagship 400 million people who visit us every year destinations. and work in partnership with the hundreds It also means preparing for tomorrow’s of customers that have space with us to visitors by testing new, innovative concepts ensure we all succeed. In association with October 2019 | 3 CONTENTS 10 BRANDS LEADING CHAPTER THE WAYCHAPTER 1 Immersive2 experiences drive footfall Street food finds favour Forward-thinking fashion is in vogue PAGE 5 THE 10 BRANDS CHAPTER CHAPTER 3 STRATEGIES4 FOR SHOPPING The Entertainer CHAPTER CHAPTER CENTRE SUCCESS Knowing the customer is key Hotel Chocolat 1 CHAPTER2 TechnologyCHAPTER helps to track shopper spend Collection points merge bricks and clicks Nespresso 1 PAGE 11 2 CONCLUSION Primark CHAPTER CHAPTER THE EVOLUTION OF Seasalt 3 CHAPTER4 THE LEISURECHAPTER OFFER Holland & Barrett Entertainment goes up a level CHAPTER CHAPTER3 Market Halls4 resets the table Joules CHAPTER How toCHAPTER increase dwell time Krispy Kreme 1 2 PAGE 16 CONCLUSION 1 2 Costa Cofee CONCLUSION THE FUTURE OF Market Halls CHAPTER CHAPTER THE SHOPPING CENTRE CHAPTER New schemesCHAPTER being brought forward 3 4 Centres for trialling new formats 3 Managed retail4 environments offer benefits PAGE 20 METHODOLOGY This report uses a mix of data points to identify CONCLUSION FIVE KEY TAKEAWAYS 10 brands helping to shape the future of shopping CONCLUSION PAGE 23 centres. UK sales performance for 2017-18 (or the latest available full-year period) taken from Retail Week Prospect or company accounts is considered alongside the number of new shopping centre openings over a three-year period (from March 2016 to March 2019) based on Local Data Company (LDC) data. This quantitative data is considered alongside qualitative data on new store innovations covered on retail-week.com. 4 | October 2019 In association with CHAPTER 1 10 OF THE BRANDS THE 10 BRANDS LEADING THE WAY n Brands are driving footfall with immersive experiences n There is a real taste for high-quality, responsive F&B outlets n Fashion retailers that think outside the box are firm favourites NEW OPENINGS: The Entertainer 25* Family-owned toy retailer The Entertainer operates around 160 UK stores, most of which are based in shopping centres. Recent openings include a refurbished Westfield London store in 2018 and a new site at intu Watford in April 2019. With its focus on strong merchandising and in-store theatre, The Entertainer aims to open upwards of 15 new UK stores a year. It has repeatedly said that bricks and mortar remains a central part of its strategy, alongside a big push to develop its multichannel offer and the launch of a new mobile-first website last year. KEY STORE INNOVATION The new Westfield store features a Magic Mirror photo booth, a Launch UK sales 2017-18: £158.4m (+6.2%) Pad area with iPads for children to play on and interactive flooring. Group profit before tax: £11.9m (+37.6%) *All store opening figures are for a three-year period In association with October 2019 | 5 NEW OPENINGS: 17 Hotel Chocolat Hotel Chocolat has dabbled with international growth in recent years, with a selection of store openings in Japan and the US, but not at the expense of developing the shop portfolio in its UK heartland. The chocolatier has now reached 103 stores nationwide and continues to experiment with fresh formats and new locations. A flagship opened in Oxford’s Westgate shopping centre at the end of 2017, while innovative concepts featuring cafes, event-hosting and ice cream ranges continue to appear in locations across the UK. KEY STORE INNOVATION UK sales 2017-18: £112.2m (+10.8%) The retailer hosts chocolate ‘lock-ins’ where people can learn more about how Group profit before tax: £12.7m (+13.4%) its products are sourced and made. NEW OPENINGS: 15 Nespresso Coffee brand Nespresso is one of a number of direct-to-consumer brands expected to play a prominent future role in UK shopping centres, having established a presence in the likes of Bluewater, Kent, One New Change, London, and intu Victoria Centre, Nottingham, in recent years. With its unique product and experience-led approach, Nespresso is bringing something different to the market while driving footfall across its 59 UK and Ireland boutiques. KEY STORE UK sales 2018: £201.8m (+11.3%) INNOVATION Group profit before tax: £8.9m (+15.7%) Visitors can try the complete range of tastes and flavours.
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