Making outlet shopping great
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- 16:09, 03 December 2019
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As consumer habits develop rapidly and online shopping grows, a bright spot in the retail landscape is retail outlets. Developer and operator NEINVER is growing both sales and visitor numbers across its European portfolio. Sebastian Sommer, marketing & retail director Europe at the firm, reveals how its done.
With investors and operators upping the game on shopping experience over the years, outlet centres are established as a thriving retail segment with their own performance and evolution, different from traditional shopping centres.
For the last five years, sales at NEINVER’s outlet portfolio, which currently comprises 18 centres around Europe, have grown by an average of 8% annually. Premium outlet centres have complemented their appealing value proposition of discounted prices, with a much more upscale experience that resonates with savvy and experience-looking consumers.
Moreover, as these centres have grown more sophisticated, brands no longer see them as a way to merely channel surplus stock, but also to drive business and reach new customers.
Roppenheim The Style Outlets in France features over 100 boutiques of premium French and international brands such as Galeries Lafayette, Guess, Karl Lagerfeld, The Kooples and Villeroy & Boch in more than 27,000 m2. The centre was chosen by brands as one of the most beautiful outlets in Europe.
‘When visitors come to our Roppenheim centre, they are not just looking for an exclusive item, they plan to walk around, spend time and have an upscale shopping experience,’ Sommer explains.
After recording seven years of continuous growth, and an increase of 40% in the value of the centre, NEINVER is further building on this promenade component of the centre through a refurbishment that is renovating the greenery, the children’s playground and restaurants' terraces. Evolution is vital to continue maintaining resilience.
‘Outlet centres continue to record increases in customer traffic and sales because they have managed to keep aligned with shoppers’ demands. Our centres today are far from being an aggregation of retail offerings at discounted prices,’ says Sommer.
REFURBISHMENTS AND EXTENSIONS IN EUROPE
Renovating and expanding some of its most consolidated centres is a key element of keeping NEINVER’s value proposition relevant in a competitive market. Vicolungo The Style Outlets in Italy, which has been expanded twice due to its success and currently comprises 150 boutiques in 34,000 m2, has started renovations.
‘These changes are going way beyond a fresh coat of paint but intend to improve the entire atmosphere of the centre and to tailor them to consumers’ changing tastes, as well as to create the best environment for retailers to showcase their brands,’ Sommer explains.
The company and Nuveen Real Estate – the co-owner of the centre – are investing €9 mln in restyling the centre with works led by the prestigious international architecture studio Chapman Taylor. The main square, the canopies and the street furniture are being fully renovated.
The company is also renovating The Style Outlets centres in San Sebastian de los Reyes and Getafe, in Madrid, and has already completed works at FACTORY Poznan in Poland and Fashion Outlet Barakaldo in Spain. NEINVER’s approach works. At Halle Leipzig The Style Outlets in Germany, visitors rose by 22% and sales jumped 32% in 2018, following an extension that brought total GLA to 18,000 m2. The company also added more leisure options and services, including a new restaurant, a kids’ play area and a family room, as well as a shuttle bus service, mobile phone charging stations and wheelchairs and pushchairs.
These renovations are also an excellent opportunity to attract premium food and beverage operators that build on the centres’ destination component. At Vicolungo The Style Outlets, a new smart gourmet SPACE by the Italian renowned chef Antonino Cannavacciuolo opened last spring, a new milestone in the company’s F&B strategy.
‘We are designing a compelling F&B offering across the portfolio by focusing on a high-quality, differentiated and varied food and increasing the offer,’ says Sommer.
CREATING A VIBRANT OFFER
Understanding what shoppers want is crucial as the market rules change. The emergence of ‘Gen Z’ consumer segment, along with millennial consumers, is an example of a challenge which is making retailers raise their game yet again.
‘Today, the consumer market is more complex than ever, but we also have more tools than ever to get to know them,’ says Sommer. NEINVER is leveraging on this opportunity through the implementation of new geolocation systems that allow to get insights on their visitors, including their behaviour and shopping patterns. The company has been testing this system at the centres at San Sebastian de los Reyes and Viladecans, and it plans to roll it out along its entire portfolio over the next year. This consumer diversity has also an impact on the way outlet centres cater to shoppers.
‘While in the past years outlet centres grew by marketing to a mass market consumer interested in acquisition, today centres will grow by marketing to people proud of their diversity, less brand loyal and with higher expectations of service and of experience,’ Sommer explains.
The company has traditionally created actions focused on discounts. Now, these actions are designed around shopping experience. In Italy, Vicolungo and Castel Guelfo centres launched summer pre-sales with Style4Music, a music event in which guitars and visitors took central stage. Besides an exhibition by a prominent artist and
musical activities for kids, the high point of the event was a special guitar flash mob in which all visitors in both centres could play the same song together, chosen by fans on social media.
Meanwhile, Viladecans The Style Outlets in Barcelona is celebrating the first Saturday of each month “My Day”, a journey including special activities with each edition focused on one aspect of personal care. In this market shift, the association between operators and retailers that has always been at the core of outlets’ success becomes even more relevant.
Sommer says: ‘Our business is not only about providing brands a channel to sell their surplus but about supporting them to connect with their shoppers. It’s about creating brand value, and this requires shared customer insights, high service standards and a common view of an exceptional experience.’
NEW PROJECTS TO COME
Amsterdam The Style Outlets, which will open in the autumn of 2020 in the Netherlands, will perfectly exemplify this commitment. Based in a waterside setting, the village design of the centre is inspired by traditional Dutch architecture, with an important role for vegetation and natural light. Shops will feature brick facades and shuttered windows topped by traditional pitched roofs in a nod to the factory’s original 19th-century purpose as a site for warehouses.
‘Architectural design is key in building a memorable experience. We are designing places where the consumer feels completely immersed and brands want to be seen. In fact, 76% of Amsterdam’s space is already committed in this early phase.’
With the same conviction, NEINVER will open in the spring of 2021 Alpes The Style Outlets, a luxury retail destination designed in an Alpine village style with chalet-style shops and terraces. Both Amsterdam and Alpes centres will benefit from outstanding locations combining strong catchment areas with connection to key tourism routes.
The Dutch centre is the first outlet development in the Randstad area, one of the wealthiest and most densely populated regions of Europe, benefiting from a catchment area of 12 million people and located 10 minutes from Amsterdam’s Schiphol airport.
Meanwhile, Alps centre will benefit from a catchment area of 5.3 million inhabitants featuring the second highest purchasing power in France and will have direct access to the A40 motorway, a vital transport link between France and Switzerland and to popular winter destinations.
To attract this affluent resident as well as tourists, NEINVER is conceiving high-end retail destinations that will combine a luxury environment, top guest services along the customer journey and a premium commercial mix.
‘Every aspect of the experience is being designed around consumers and with the objective of enabling a deep and precious connection between them and our brand partners,’ Sommer concludes.