Spotlight: Retail Revolutions

Retail Revolutions
 
Spotlight on shopping centres

27 September 2016, by Marie Hickey

Getting the balance right between ‘convenience’ and ‘destination’

 

Much of what has been examined in terms of consumer shopping habits and preferences in relation to fashion is universal across the retail property spectrum. However, shopping centres play a vital role in this experience and in some cases may be better placed to maximise the experience and spend of shoppers.

Shopping centres topped the ranking in terms of preferred location type when shopping for clothing and footwear with 43.4% of respondents placing it in their top three preferred locations. This was on a par with those who placed shopping online as one of their top three retail locations. This preference for shopping centres was even more pronounced for Generation Z and Millennial respondents, with 62.9% and 53.4% respectively placing it in their top three.

Respondents preference for shopping centres, particularly amongst the younger demographic groups, highlights the role the wider shopping environment can play in attracting consumers and in turn maximising the performance of individual retailers. The fact that centres are typically under single ownership means that they are usually the best placed to deliver an ‘attractive’ shopping environment as management can deliver a cohesive experience with the additional facilities shoppers often demand.

While the survey found that over a third (38%) of respondents would visit a larger town and/or shopping centre if their local offer did not meet their fashion needs, 48% under the same circumstances would simply move their purchase online. For some of these respondents the option of visiting a larger town and/or shopping centre is simply not feasible due to the nature of their specific needs and/or distance from a larger ‘centre’. However, there may be a significant proportion that could be enticed to visit that larger ‘centre’. To achieve this shopping centres would need to become ‘destinations’ in their own right, widening their shopper catchment.

A number of shopping centres already achieve this due to their sheer size and location. But, this draw does not exclusively need to be determined by centre size. Variety of retail offer, introduction of ‘new’ brands, curating the offer to meet demand, shopper events and the food offer can all come together to enhance the ‘destination’ appeal of a shopping centre. This in turn can widen its catchment to the benefit of its retailer occupiers.

Having said this, there is also a ‘convenience’ need a shopping centre can also potentially fulfil. Baby Boomer survey respondents, a group considered to have the greatest potential spending power, appear to value convenience over destination shopping. This goes some way to explain why small local high streets and online shopping were rated more highly as preferred shopping locations by this group (46.1% and 40.1% respectively of 55-64 year olds placing in their top three). The challenge to centre owners is then how to improve the ‘convenience’ appeal of their centres, not just in terms of retail offer but also in terms of accessibility and ease of navigation, to attract these consumers.

For shopping centres therefore, it is about delivering an overall offer and experience that meets the ‘everyday’ needs of its local catchment as well as the ‘aspirational’ wants associated with being a ‘destination’ centre.

 

 
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Key Contacts

Tom Whittington

Tom Whittington

Director
Retail Research

Savills Manchester

+44 (0) 161 244 7779

 

Marie Hickey

Marie Hickey

Director
Commercial Research

Savills Margaret Street

+44 (0) 20 3320 8288

 

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