Retailers drive centre innovation
While Australian shopping centres are at the forefront of food on a global scale, it is retailers that are driving this trend as a result of their own innovations, says the chairman of the International Council of Shopping Centres (ICSC).
Bob Welanetz, chairman, and Michael Kercheval, CEO of ICSC, visited Australia last week in partnership with local shopping centre representative body, the Shopping Centre Council of Australia (SCCA).
Welanetz told Inside Retail PREMIUM that shopping centre landlords such as Westfield and AMP have taken advantage of what Australian food retailers are doing to react to customers.
“A distinguishing factor of major shopping centres in Australia is the incredible development of food as a component of the merchandise offer,” Welanetz said.
“They are at the front edge of the world stage on this issue.
“What is driving this is the competitive nature of these retailers fighting for customer share, but they’ve (shopping centres) taken it to a level well beyond most anything I’ve seen. It’s a compliment many Australian retailers would be pleased to hear, with commentary on the superiority of Australian centres often attributed solely to architects and developers.
His comments also recognise the importance of good content in creating some of the country’s world class shopping centre offerings.
“I walked through the new fresh area at Macquarie Centre, and Coles is doing a fantastic job,” he said.
Welanetz has a high level of regard for the Australian retail real estate community, telling Inside Retail PREMIUM that Australia stacks up well worldwide from a best practices standpoint.
“The degree of professionalism in the industry on multiple dimensions is extremely strong.”
Another aspect winning praise from the ICSC chairman is local proficiency when it comes to retail within mixed use environments.
“If you look at what’s going on in emerging nations and the amount of new population that’s being added to the global stage, over 50 per cent of that is moving into urban living.
“There are great examples from the Australian portfolio, but also around the world where I think retail within mixed use environments is going to be big – not just office environments,but hotels and residential.
“Those things as commercially planned projects and as amenities for contextual environment that people have to interact with is strong.”
Despite Welanetz’s praise of the Australian market, he warned that there is one thing that should be avoided: homogenisation of retail centres.
This trend could potentially become a threat in the next five to 10 years with the entry of a raft of new international players.
“New entries into the retail market is an opportunity for the consumer and is a good thing. These retailers are formidable and have the wherewithal to deliver and expand fairly quickly in multiple formats.
“But what people need to be careful about is a homogenisation of every single retail environment.
“It’s a delicate balance, because you want to have the best represented in segmented market conditions, but if there’s no difference between shopping centres, then it is all about location.
“Rapidly evolving as best you can to make the obvious quick transformation these days is the way the best get better.
“The point of difference doesn’t necessarily have to be content, it can be the atmosphere or physical space.
“I am a huge believer in community connection because it enhances loyalty, frequency of trip, and length of stay – all the things so important to sales generation.”
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