Retailers are investing in "differentiating experiences" for the customer
Last Thursday, Lisbon hosted the Meridiana Meetup - MAPIC, an event organised by Meridiana, MAPIC's representative in the Iberian Peninsula. Held at the IDB Rooftop and sponsored by IDB Lisbon, Jamestown and Placer, the meeting brought together industry leaders and professionals to discuss the future of commercial spaces.
After a welcome by Jan Verwijs, Vice President, Asset Management at Jamestown Europe, the debate began with a round table moderated by António Gil Machado, Director of the Iberinmo Group, who invited those present to reflect: "What is the big change in assets in the last three, four, five years? The classifications are increasingly complex. Shopping centres now house spas, health clubs, medical clinics, co-working spaces and shopping offices."
Sofia Ferreira de Almeida, Head of Property & Asset Services (PAS) at Nhood, said that "now we can go to shopping centres and do various activities. Going to the doctor, having fun with friends, taking our children, having new experiences and, of course, shopping. This diverse and complementary offer helps to fulfil consumer needs and improve the environment. The idea is to increase the time customers spend in shopping centres and turn them into local destinations, not just places to shop and go out. With this increase in permanence, sales should increase, which benefits investors and managers".
Ricardo Rosa, Sonae Sierra's Director of Innovation, explained that the customer experience goes beyond simple shopping. "When a customer enters a shopping centre, even if we continue to call it a shopping centre, they don't just expect to shop. There is a point of experience that can include entertainment, but also going to the doctor, among other things. And I say 'other things' a lot because it's multiplying."
Ricardo Rosa stressed the need to strike a balance between meeting customers' immediate demands and ensuring the long-term sustainability of shopping centres. "It's a balancing act. We have to understand what the customer wants, but at the same time understand how this asset appreciation can be maximised over time. We can't just look at the next two months. We have to consider that these assets have been here for a long time, and will continue to be for a long time. So we have to maximise the profitability of the assets."
On the other hand, Jan Verwijs, Vice President, Asset Management at Jamestown Europe, brought an interesting perspective on the evolution of workspaces. "We approach it from a slightly different perspective, since we are starting out as an office building. But I think that, in a way, very little is changing. Office occupiers still see their workspace as central to their brand, as it always has been. In the past, many companies considered that glass buildings and large office lobbies impressed people and made them want to work there. We're seeing that dynamic change. People now prefer spaces with history, life and colour, like IDB Lisbon. I think we all have a common goal: to make someone leave our space feeling better than when they entered."
Eduardo Pinto Basto, Managing Partner of Placer, highlighted the transformation of shopping centres and the need to adapt to the new consumer scenario. "Shopping centres were built to meet a need. And now that need is met much more efficiently at home. Nowadays, you buy everything you need from where you can consume it. Today, retailers need to be closer to the consumer experience of what they are selling. Responding to the need to buy is not what will bring people to shopping centres in the future. We need to be where people want to spend their time."
Developers of public spaces
The Placer representative believes that the shopping centres of the future "will probably be places where people want to be; they don't want to go to an artificial environment just to buy a specific product. I believe that both retailers and developers will become developers of public spaces. We want to create spaces where people want to socialise, dine, play sports, be entertained by arts or shows, and then sell them what they didn't even know they needed. It's probably retail that will finance the public spaces. It's very interesting that the shopping centre model is emerging with public-private partnerships, concessions for parks, museums and arenas for shows. And that says a lot about where the consumer is and where we need to find them."
Bringing the online together with the physical shop
Ricardo Rosa addressed a fundamental question raised in the debate: how to adjust the business model to the possibility of people buying online, even in the physical shop? According to him, "this is ultimately the most difficult question the industry has faced in recent decades. The point for us is that spaces continue to be absolutely central to the business". Consumers go to physical spaces "not only to make purchases, but also to experience products, test them out and even for more convenient returns", he added.
The Sonae Sierra representative also emphasised the evolution in the relationship between the physical and online worlds: "There is a connection between the physical and online worlds that is now very evident, something that wasn't the case 10 years ago," he said, adding that physical spaces "have a fundamental value in retailers' business models, even when transactions take place predominantly online". In addition, Ricardo Rosa pointed out the importance of continually evolving to integrate these two worlds: "we need to see how we can profit from this. This is an ongoing conversation about how we can share this type of business to ensure that everyone continues to win."
Retail Experience
Sofia Ferreira de Almeida also spoke about the retail experience, taking the consumer to a level beyond the purchase. "Retail Experience aims to provide customers with unique and memorable experiences. If these experiences 'don't look good on Instagram', then they're not worth it. For this to happen, there are three main axes: the first is to involve consumers in the experiences (unique and immersive experiences). Secondly, involving consumers and technology. Finally, having an omnichannel presence. There has to be a physical presence, an online presence and also a social media presence. I think the idea is to remain agile, adapt quickly to consumer needs and use digital".