RECON 2013: Leaving Las Vegas

May 22nd, 2013

james brownPosted by: James Brown
Head of EMEA Retail Research
Jones Lang LaSalle EMEA Research

 

 

Four days and four nights in Las Vegas for our JLL Global Retail Agency Board at ICSC RECon and I have made four observations.

 

  • First, the US is an amazingly dynamic and innovative retail market, with a vast, untapped supply of retail and leisure brands and formats that have yet to explore new territories.
  • Second, global is the key theme that dominates recent conferences I have attended. Against the backdrop of mixed economic growth prospects and therefore both risk and opportunity, the globalisation of retail appears to have accelerated.
  • Third, our JLL global network of retail expertise and its potential to advise global retailers is what it is all about. ICSC RECon Vegas has assisted in building stronger internal and client relationships and in creating new opportunities.
  • Finally, Las Vegas has exceeded expectations and has provided everything we needed to get us through the four days. It is truly unique, but it’s now time to head home.

 

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Posted in Global, ICSC | No Comments »

UK Retail – British Land signs deal with BT to provide Wi-Fi at its Shopping Centres

May 13th, 2013

jonathan bayfieldPosted by: Jonathan Bayfield
Retail Research & Consulting
Jones Lang LaSalle EMEA Research

 

One of the big stories in the UK retail sector this week is that customers at British Land’s shopping centres will be able to enjoy free Wi-Fi later this year. As many of you know, for me, this is really great news!

British Land’s full shopping centre portfolio will benefit from the deal with BT Wi-Fi. Additionally to providing free Wi-Fi to its shopping centre customers, British Land has come to an arrangement to work with BT to try and deliver a strong Wi-Fi offering at a number of its open air shopping parks.

The move follows news from earlier in the year that intu, the rebranded Capital Shopping Centres, is installing Wi-Fi across its shopping centres as part of a wide-ranging digital improvement. The Trafford Centre is the first in the portfolio to benefit from a new fibre optic network and the provision of high quality free Wi-Fi throughout the mall.

It seems that Wi-Fi in UK shopping centres is slowly becoming the norm. It wasn’t too long ago that I visited Westfield Stratford City after work to pick up some ‘summer’ items for a family trip to Southern Africa. My flatmates and I did a bit of shopping, then went for a Nando’s; while waiting in the queue I was able to log on to the Westfield Wi-Fi and find out whether retailers had launched their ‘summer’ lines or not, and see what was in the market before I went in to try on my favoured items.

Intu’s research signals that almost half of UK internet users will, like me, make use of the internet at some point during the shopping process and that the conventional borders of online and offline shopping experiences are becoming more distorted. As I have discussed in this blog before, the introduction of new technology by both retailers and landlords is crucial to improving the customer experience, and increasing the connectivity between the landlords, retailers and consumers. British Land, Westfield and Intu are at the forefront of this evolution, as they seek to provide customers with a harmonious, multi-channel experience in their centres.

 

Please click on this link if you would like to read this week’s retail and leisure news.

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Posted in Retail 2020, Shopping centres, Trends, UK | No Comments »

What is retail’s future?

April 22nd, 2013

emea-retailPosted by: Jonathan Bayfield
Retail Research & Consulting
Jones Lang LaSalle EMEA Research

 

Three months after joining Jones Lang LaSalle as a graduate in the Retail Research team – I thought I should have a look into where I think the current retail market is and peer into its future.

The shopping centre or high street of yesterday is a thing of the past. Customers, myself very much included, are searching for a multi-channel combination of accessibility and, more importantly, experience. This new type of consumer is demanding more from the retailer than ever before. I want to have freedom to shop when, how and wherever I want. Whenever I look to buy in store, I will have looked online and vice versa. In fact, often I’ll be browsing my phone, sending my friend’s pictures of what I am trying on and they’ll be sending me information about what else is out there. Radical structural change is taking shape, which the real estate industry must adapt to. This video of London’s new Burberry store showcases the store of the future, the merger of the high street with e-commerce.

‘Experience’ focused stores, which marry elements  of e-commerce (such as Burberry’s) in super-prime locations, such as London’s Regent Street, are the growing trend for international retailers, as our team has detailed in the recent Destination Europe 2013 report.

Retail’s future is clearly going to have an ever increasing engagement with the internet. As a big fan of my iPhone, I am not surprised to note in this BCSC report, that 25% of total UK sales are expected to be driven by m-commerce (mobile) by 2020.

As shoppers increasingly become visitors of retail space, the shop experience becomes more crucial for brand engagement as new consumers can shop on the move anytime and anywhere. London’s Niketown,  in the prime location of Oxford Circus, has been a leader of this engagement for a number of years. Much to my family’s frustration, I would love to kick a football around on day trips to London and watch the latest extended edition adverts in store, never buying anything there and then.

The latest type of commerce predicted to start making more and more powerful waves in the sector, is s-commerce. This is essentially the effective use of (online) social networks to promote and sell good. Retail Specialists, Conlumino, have analysed s-commerce’s likely growth and claim that over the next five years, the value in the UK will rise from £1.6 billion today to around £3.3 billion. Retailers using sites such as Facebook, Four Square and Twitter to drive sales and footfall to stores are likely to be ahead of the market, for a consumer like me at least.

Posted in France, Germany, Retail 2020, UK | No Comments »

City breaks that break the bank

November 30th, 2012

Posted by: Colin Burnet
Retail Research & Consulting
EMEA Retail Research and Consulting

Wondering where to go on your city break next year? If it’s shopping you’re after, and the buzz and glamour of the big, international brands in particular, then Jones Lang LaSalle’s new report, Destination Europe 2013, is a must read.

The report unveils our new cross-border retailer index, which analyses the expansion and presence of 250 international retailers across 57 key European city retail markets. London comes out as the most attractive city, with Paris, Moscow, Milan and Madrid, all mature retail markets, comprising the remainder of the top five most attractive cities.
London is a springboard for many retailers who want to expand internationally. Several US and now Chinese retailers have started their European journey over the past few months in this way. More will follow, driven in part by Westfield’s successfully launched new shopping centres, continued demand for space in Bond Street, Oxford Street, Regent Street and Covent Garden, but also sustained market opportunity, tourism levels post the Olympics, political stability and a transparent real estate market.

However, with subdued economic growth in Western and Southern Europe, retailers are also starting simultaneously to look further east. Emerging growth markets provide attractive expansion opportunities. Rental levels are generally lower than in more mature markets and retail sales growth prospects are clearly stronger. St Petersburg (8th), Prague (9th), Istanbul (11th), Warsaw (19th=) and Kiev (23rd=) all therefore perform strongly in the index within this context. Central and Eastern Europe has more markets in the top 30 retail locations than Southern Europe. For mature retailers established in core European markets, Eastern Europe provides both growth opportunities and diversification.

So, plenty of tasty options there for the city breakers amongst you – just remember to take your credit card, and leave plenty of room in your suitcase…

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MAPIC 2012: Emerging market opportunity – Core market priority

November 23rd, 2012

Dominic BouvetPosted by:
Dominic Bouvet
Pan European Retail Agency

Having landed safely on British soil and back into the swing of normal – non-conference life – I have been asked by my colleagues what the sentiment at Mapic was like. JLL’s latest research suggests, and pardon my crude summary, that we have observed burgeoning success of the emerging growth markets and these markets provide some attractive expansion opportunities for retailers with established growth strategies.

A perfect example is Swedish retailer H&M. Ranked second, just below Zara in terms of % of coverage across Europe’s key markets, it currently has a presence in 96% of markets covered. With plans to open stores in Mexico, Malaysia and Kuwait over the next 18 months, H&M clearly has its sights on furthering its global coverage. This resonates loud and clear that retailers with a strong and translatable position should and clearly are exploring international expansion.

However, even though there is little doubt that European retailers understand the huge opportunity in the emerging markets, such as the BRIC countries, from the discussions I had at MAPIC retailers are realising that entering these markets with multiple stores is not as easy as first anticipated and there are several reasons for this, including high property costs, high land values, political difficulties and logistical issues. The European retailers that I met in Cannes are hence re-focusing on their core portfolio of stores in prime shopping centres and on the high streets, which is encouraging news for all those involved in the European retail market.

To summarise, the opportunity for retailers to grow their portfolio is inevitable in the emerging markets, but it is essential that they do not forget their core markets!

Posted in CEE, France, Germany, MAPIC, Russia, Turkey, UK | No Comments »

MAPIC 2012: industrial needs to act as e-tailing glows white hot

November 14th, 2012

Ben Havery JLLPosted by:
Ben Havery
EMEA Logistics & Industrial

Early November. You can tell it’s time for MAPIC as the Christmas lights slowly begin to get switched on across Europe. The high streets and shopping centres will start filling up with Christmas shoppers, but more than ever, we are seeing the huge impact of growing online retail sales.

I have heard [during my time in the bunker], that for every €1,000,000,000 [EUR1 bn] of new online spend, retailers require an additional 72,000sqm of distribution space – that’s a warehouse roughly the size of fifteen football pitches, or half the retail floor area at the Westfield London Shopping Centre.

A knock on effect of large retailers investing in online sales channels, is a desire to own distribution networks. This helps large international retailers control costs and minimise risks instead of relying on third parties. But with this comes complexity. From development acquisition and funding advice, to supply chain analysis. Cutting edge retailers may also want to consider green initiatives that help deliver their CSR goals.

Online retail, like the lights on Oxford St is glowing hot. There is a trend for on-line retail occupiers to commit for longer, resulting in premium capital values. However, we should not forget that as the sector grows, the logistics development sector needs to react.

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Retail takes off…

November 13th, 2012

Gould, VictoriaPosted by:
Victoria Gould
Director, Shopping Centres Retail UK

While relishing a spot of quiet time before I boarded my flight to Nice for Mapic 2012, I thought it was an ideal opportunity to share my thoughts on a number of aspects of airport retailing – my pet subject as I am the Retail Director of the newly formed JLL Airport Group.

Airport retailing is so different to the traditional high street and shopping centre locations in the UK – but the basics are still the same. Retailers need to understand the longer trading hours, exaggerated peaks and troughs during the year, the detailed quality of the passenger data and the generally positive frame of mind of the passenger. People travel for a variety of reasons – but everyone buys something at the airport whether it be a coffee or a Mulberry handbag.

We are currently working with a number of airport operators globally, trying to dispel any myths regarding the complexity of trading in such an environment – yes there are challenges, but the opportunities hugely outweigh them. We are helping them to deliver new retailers and bespoke concepts to the world of airport retailing. UK airports are generally market leaders in terms of retailing – having already identified the spend potential in the airside environment – especially following the introduction of the new security measures after 9/11, which means that passengers are keen to get through security and there is no particular desire to dwell landside. There is still significant room to improve the offer for travellers – to provide the premium shopping centre environment, just with some planes and a runway attached!

Gatwick Airport is leading the way in trying to break the mould in terms of offering the overall airport experience – the customer comes first – from the moment they arrive, through the world-class automated security system to the departure lounge which is currently under development (South Terminal) that will provide an exciting but stress-free shopping environment. Gatwick is also encouraging an omnichannel approach – with the hopeful end result that retailers will have a capsule offer onsite (airport stores are by nature much smaller than the high street or shopping centre interpretations) but still offering the full product range that can be ordered inshore, take advantage of the benefit of the discounted price and have it ready for collection when they return or even have it delivered to their home.

More and more Retailers are now looking at airports, especially in these difficult economic conditions – it is all about new markets, new target customers and new revenue streams.

To sum up – airport retailing is a huge opportunity for both retailers and airport operators alike – a potential win win situation. Retailers benefit from international brand exposure and new revenue streams. A great and desirable retail offer will also help attract new airlines and new routes to the airport, which in turn means greater passenger numbers and revenue growth. This is a really exciting aspect of the global retail Market for both me and Jones Lang LaSalle!

Posted in MAPIC, UK | No Comments »

To infinity and beyond….

October 5th, 2012
Posted by: James Brown
Head of EMEA Retail Research
Jones Lang LaSalle EMEA Research
Technology is truly accelerating the rate of change in how retailers promote their products, and in how we shop and communicate. Here is a great example of combining traditional retailing with augmented reality and social media.

Against the backdrop of structural change playing out in retail, there is a need to figure out what the future retail and retail property landscape will look like.Without a doubt there will be more retail casualties. Some of the retail failures will be overdue, in other words, they only lasted this long thanks to a decade of impressive consumer spending, but others will fall victim to increasing competition from the internet. The UK leads the way online and whilst other European countries are lagging, growth in online will continue across the board, for some time to come. Our estimate is that 25% of sales in the UK will ultimately go online and this will hit some harder than others – retailers (books, music, software, gaming, electricals etc.) and retail property alike. The winners will be those that differentiate through exceptional convenience or experience, or both.

What the future holds was discussed at length at the recent BCSC annual conference in Liverpool, is likely to feature heavily at Mapic in November and will remain front of mind for many, for some time. What is for sure, is that predicting the next phase of retail will not be shaped by looking at the past, but will be far more reliant on innovation, entrepreneurialism, dynamism and foresight. Look at the data, but be prepared to think the unthinkable, because in some areas of retail it is already happening.

Posted in Sweden | No Comments »

Global Retail Banking – Prepare today or fail tomorrow

July 12th, 2012

Posted by: Colin Burnet

Retail Research & Consulting

EMEA Retail Research and Consulting 

We live in a world of economic uncertainty and marketplace volatility. Weakening growth in the developed world, allied with a lack of political leadership is unnerving markets and business leaders alike. As this blog is published, the eurozone crisis rumbles on (or even worsens). Meanwhile, the political stand-off in America is adding to the sense that leading authorities will make a fatal miscalculation.

At the heart of all of this, still, are the banks. Despite the stress tests, there are too many unknowns for any complacency. How many toxic assets still sit on bank balance sheets? How far will slow economic growth or any rises to interest rates, cripple the banks’ loan books? What are the counterparty risks? How quickly could sovereign insolvency and bank illiquidity lead to a meltdown of confidence, a drying up of the interbank market and a second credit crunch? To what extent will regulation force restructuring in the banking industry? Which bank is the next to fail or to need government support?

Meanwhile, the picture in the developing nations and frontier markets could not look more different. By and large we are looking at an increasingly decoupled world where Asia (and other emerging markets like Brazil) are reaching a self-sustaining cycle with far less dependency on the USA and Europe. On-going trade surpluses are raising domestic demand little by little. Economic growth has recovered quicker and to much higher levels than in the developed world. Meanwhile, banks in China, India and beyond, cleansed a lot of their bad debts in the 1990s and capital ratios are in better financial shape than in the West. Despite occasional nervousness about bad loans (e.g. in Chinese local government), and a marginal weakening in economic outlook, the still strong GDP expansion means that, overall, banks in developing countries are looking forward to a decade of profitable growth.

With such macro-economic instability (and divergence), geo-political and balance sheet uncertainty, who’d be a forecaster? And yet it is vital to get our hands around the future. Yes, the exact future is unknowable, but it is possible to anticipate plausible outcomes which can then inform decision making today. Better to predict, assess probabilities and prepare than sit back and become the victim of future changes.

It is in this spirit that Jones Lang LaSalle we have written a report on Retail Banking, 2020. Using desk research, expert interviews and industry round tables across three Continents, we have taken a 360° tour of the horizon. We have looked at political, economic, technological and socio-cultural trends. Bringing this together, we have then analysed the knowns, taken a view on the unknowns and derived a plausible vision of where retail banking is going internationally, and what the knock-on effects will be for real estate markets. Read Global Retail Banking 2020 to find out more

Posted in Retail 2020, Trends | No Comments »

Who will win gold in 2012’s summer of fun?

June 4th, 2012

 

Julie Collins Jones Lang LaSalle

Posted by: Julie Collins
Retail Research

Jones Lang LaSalle EMEA Research

With less than 70 days to go now until the London Olympics, retailers will be hopeful that the combination of the Queen’s Jubilee (and a welcome additional bank holiday); the Euros and the Olympics will lead to an increase in consumer spending. Pub and restaurant operators will also be looking to the summer festivities to make up for what has been a soggy start to the early summer.

The key questions are whether, given all the hype, spend will increase, and who will benefit?

Undoubtedly grocery spend will increase as a result of Jubilee street parties, Olympics bbqs and football gatherings. Sainsbury’s and Waitrose are currently looking well placed to take advantage of this additional spend.  Their recent form suggests that customers are happy with the service and quality provided, and many non-shoppers will see the summer celebrations as a perfect opportunity to trade up from Tesco, Asda and Morrisons. Whilst Tesco have replaced their ‘Tesco Value’ range with ‘Everyday Value’ and have brought back their Clubcard Exchange promotion, they have limited time to change their poor customer perception, and gain sales from their competitors.

John Lewis is likely to continue its run of form with strong sales of TVs and merchandise for both the Jubilee and the Olympics.  The windows of John Lewis Oxford Street currently show a strong Cath Kidston / Emma Bridgwater focus and a key highlight on all things ‘Union Jack’.  British retailers will benefit from the surge in patriotism associated with the summer events, for example, the ‘Corgi’ women’s tops in Next and the Jubilee tea cosy’s currently on sale in M&S.

Who will struggle to benefit from the ‘summer of fun’?  Well, big ticket retailers are likely to continue to suffer.  If grocery, TVs and Jubilee / Olympics merchandise spend are all set to increase, then spending elsewhere simply has to be squeezed with the economic climate as it is.  With shoppers at Jubilee parties, watching the football or at the Games, spending on DIY or new sofa purchases will be less likely this summer.

Summer 2012 offers a number of retailers a real prospect to grow sales.  Availability of products is imperative for supermarkets, and the weather will no doubt play its part in sales.  Retailers at Westfield Stratford City have an amazing opportunity to convert visitor numbers into actual spend; appealing window displays and short queues will be fundamental for this.  It remains to be seen how successful Team GB and England will be, but retailers will certainly be hoping for a golden summer.

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