e last fortnight, almost in-step with the closure of Holden’s Elizabeth St factory, two major international automotive brands have unveiled a new type of plan for the local market in a bid to re-define how Aussies buy cars. First came Jaguar Land Rover, which launched a new concept store earlier this month designed to tout a new type of digitally-integrated store while tackling its luxe perception to appeal to middle-market buyers. The kicker? The new location, which can facilitate test-drives and retailing vehicles on site, is run out of a 290sqm tenancy within Westfield’s Bondi Junction centre in Sydney. It’s also a little more than a stone’s throw away from Sydney’s traditional auto-retail heartland in Alexandria, even if it comes at the cost of premium retail rents. Then there’s Mercedes-Benz, which will open a standalone site in the heart of Melbourne’s CBD in November. The locale isn’t smack bang in the middle of a Westfield, but it’s also not a dealership – in fact, Mercedes are selling coffee rather than cars. Seeking to capitalise on Melbourne’s world-renowned ‘coffee culture’, Mercedes has brought its flagship branding exercise, Mercedes Me, Down Under with the hope of attracting a younger demographic of customers that will be increasingly venturing into a market with less Australian made cars. Mercedes already has similar concepts around the world, all tailored to the markets they operate in, but the strategy for both brands is clear: there’s room to acquire new customers in Australia and the time to do so is now. Mercedes has similar concept stores around the world Shifting perceptions For Jaguar the decision to open a small-format location within a retail shopping centre is a step-change in its plans for the local market. Jaguar Land Rover spokesperson Tim Krieger tells IRW that the auto-brand is trying to reimagine itself in the eyes of Australia’s middle-of-the-road car buyer by positioning itself within the heart of retail thoroughfare. “The task that we have now is to build awareness of what a modern jaguar brand represents, there’s an outdated perception of Jaguar that it’s the big large saloon cars that they might have seen many years ago,” Krieger says. “But we have a full range of mid-sized sedans right up to SUVs now, so this store is a perfect way to expose the brand to a completely new audience.” Jaguar’s upcoming E-pace SUV model is expected to be a hot-sell for the new location, priced at a relatively modest estimated starting price of around $48,000 compared to nearly-double that of its sister F-pace line. The new car will retail locally in 2018, but Krieger says early interest at Bondi has already led to a pre-order. “We’re interacting with people who wouldn’t normally walk into a traditional dealership, we’re able to make the offer a lot more visible in terms of the volume of people walking by, which we wouldn’t necessarily be able to do by relying on traditional automotive outlets,” Krieger explains. Jaguar Land Rover intends to expand the retail concept into Melbourne next, before considering a nationwide expansion through other capital cities using learnings from the Bondi store to refine the offer. Embracing new retail Mercedes-Benz is making no secret of its premium position, with a comparable SUV model currently retailing at over $200,000. But while its upcoming Melbourne location isn’t a run on the middle-market, it does position the brand in the heart of Victoria’s wave of gentrification, which has seen increasingly cash-flush millennial urbanites ram-up prices in the surrounding catchment. “As well as a place for current fans and customers to enjoy, Mercedes me store Melbourne opens up the Mercedes-Benz brand to people who may not have previously considered interacting with us or our vehicles,” Simon Johnson, general manager of the new concept, says of the upcoming opening. “It’s a place where you can simply sit and enjoy some quality time in a beautiful environment, have a great coffee or something to eat, or engage with our brand like never before. It’s not a merchandise store or a dealership but an entirely new experience in Australia.” Retail without retail isn’t novel for the Australian market, but an automotive experience without the suit-clad sales-people trying to offload muffler attachments stands to provide a softer entry to the premium-side of the auto market, which IBISWorld data shows has been slowing faster than the broader market in recent years. IBIS’ senior industry analyst James Thompson says auto retailers are looking to shift away from destinational retail experiences that require customers to be in the market for a vehicle before interacting with brands. “We are seeing more money invested in shopping centres, with more up-scale dining halls, restaurants and bars and a wider range of entertainment options available,” he explains. “Automotive retailers are also opening stores in high-foot traffic areas and shopping centres. This gives them direct access to a broader range of consumers, who are unlikely to enter a dealership unless they are actively looking to purchase a new vehicle.” The model is similar to that brought to the Australian market by Tesla over a year ago with its small-scale Martin Place location. Founder Elon Musk’s electric car vision isn’t expected to take-off in Australia over the next five years (IBIS pegs total sales proportion at 0.02 per cent last year), but with a new store at Chadstone the brand is looking to lead the way in new-format auto retailing.