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Put the needs of shoppers first


Retail property is just about the relationship between the landlord and the retailer, right? Wrong. While that is, of course, vital, if we want to make our retail schemes the best they can be we need to redouble our efforts to understand our ultimate customers, the shoppers themselves. A great retail location is only

great because of the shoppers – get them spending and then retailer demand, rental growth and investment value will follow naturally. Retailers are facing a tough

time, and marketing budgets at a local level are being pulled back in favour of a more cost-effective nationwide approach. So it’s down to property owners to use their local knowledge and relationship with the community to ensure the retail scheme delivers the best possible experience, tailored to the needs of its customers. How many landlords really

understand what their shoppers want from their centres? Do you know why they come? Do you know what they feel is missing from your

asset? Do you really know why they don’t come more often or spend more money? Understanding shoppers is

crucial as we move beyond simple metrics like footfall to more meaningful statistics like spend-per-head, which is key to driving sales and rental growth. That is why research is so important. At Land Securities we have a

dedicated retail research team and survey more than 10,250 people each year, collecting 17,500 postcodes to better understand where our shoppers are coming from. Customer communication

must be two-way and personalised as modern marketing demands bespoke messages, tailored to the

individual shopper. And soon customers will

expect this as standard, in the same way that free wi-fi and mobile-enabled websites are now considered a necessity rather than a bonus (60% of shoppers in a recent US survey ranked personalised offers on their smartphones as their preferred type of offer). Shoppers not only want

technology as standard – 80% of them want to use technology to help them shop, according to a survey by IBM – but are also becoming increasingly demanding. The number of consumers making a complaint (across all sectors) has risen by 76% in the past five years, according to a survey by the Institute of Customer Service.

Retail, like our graduate, really is alive and well


We recently lost a graduate. Nothing macabre – he’s alive and well. It’s actually worse than that. He has decided move to Jones Lang LaSalle’s very successful and growing Affordable Housing team. We told him that he had

great prospects as a retail agent, but he believes that he has a better future in the social housing market because “retail’s dead - isn’t it?”. We can’t blame him. Nearly

six years of incessant economic headwinds and the exponential

4 Summer 2013

speed of change in shopping technology has produced enough negative headlines to make any youngster, or veteran, question the future of traditional retail agency. So, is there a future for UK

retail agency? Of course there is. The British love shopping and retailers need shops. Retailers also need to grow revenue and profit to satisfy shareholders or to maintain their place in the general hierarchy. It remains undeniably

difficult for retailers and we will continue to see some struggle, but many are

adapting, some are growing and some are just beginning. JLL research reveals there is current demand for over 25m sq ft of retail and leisure space in the UK – in town, out-of-town, on schemes and on the high street. This is fairly healthy. Unfortunately, this doesn’t

mean that the current vacancy rate of around 14% will be reduced overnight. Yes, retail agency is alive and well, but it’s not going to be easy. Occupiers will be more selective than ever with both their new acquisition strategy and their existing portfolio management. They will only acquire and

renew leases on stores, shops and restaurants in the right trading locations and they will require physical, legal and financial flexibility. However, it’s not all about low rent and short leases. Only those locations that complement their multiple channels to market, are functional and either offer real convenience or experience will make the grade. The UK retail market has

proven itself to be irrepressible through multiple wars and recessions and it will verify this resilience once again with the help of hard-working and well-informed retail agents.

People are becoming more

discerning and will not spend their money if their experience isn’t up to scratch. That’s why leisure is a vital part of our business. It’s so important to get the level of restaurants and leisure right to increase dwell time and spend per head. We must look to learn from

other sectors such as the best airports, hospitality and theme parks, indeed anywhere where the customer has a great experience. We need to not only

understand customers and keep up with their changing needs, but look ahead to what they’ll be demanding next and keep on tailoring the way we interact with them. This hard work will reward

us with growth and outperformance.


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