The changing face of designer outletsDigital Manager
Last week Capital Shopping Centres was dramatically rebranded as ‘Intu’ – the birth of which serves as an example of a company adapting to a changing retail climate and consumer demands. As Giles Barrie put it in Friday’s Property Week, the rebrand will allow the centre owner to ‘ramp up the concept of an “experience” in its centres’.
The need for evolution has driven the industry for years, leading to bigger and better malls. However, competition also has a big part to play in necessitating this change, and not just from rival shopping centres. ‘Designer outlets have been a standout success during the downturn’, Mark Faithful reported last year in Retail Week – this success has continued over the past 12 months and shows quite how much customers and retailers alike have taken to the inviting designer outlet concept. But, it is also because of the downturn that outlets have thrived.
It’s a simple, easily answered equation – lower prices + desirable brands + a shopper friendly atmosphere = high footfall. This applies to all types of retail, however it’s the proliferation of discounts that set outlets apart, and also accounts for the hoards of tourists that travel to the centres. Although the recession has meant that the majority have had to be a little more reserved when splashing the cash, it has not reduced most consumers’ desire to buy from top brands. Simply put, outlets are the perfect answer to cash strapped yet increasingly demanding shoppers, justifying further travel times and wider catchments – people will travel further for a bargain.
However, an outlet’s greatest asset is also one of its biggest challenges as it fights against the ‘pile it high, sell it cheap’ image. Outlet’s have to work doubly hard to create a destination environment – out of town locations mean that they have to have more than just shopping on offer. This obstacle however is generally overcome with aplomb, just take a stroll through McArthurGlen’s centre – Cheshire Oaks’ streets; a throwback to early-modern architecture in the north west.
Moreover, ‘convenience’ is the standout factor missing from that equation, and is a key reason as to why outlets are under pressure from omni-channel retailing as a continued increase in discount websites does threaten the bricks and mortar establishments. It’s been estimated that, by 2020, there will be a 25% reduction in retail requirements across Europe due to an increased reliance on e-commerce. Outlets have the ‘saving grace’ option to apply discounts only to in-store products, but the sector is far from safe from the rising online giant. Although the customer experience at outlets, often designed to embody the atmosphere of a picturesque European village, and the importance of being able to see and touch products in person will help in keeping footfall up, customers will increasingly realise that bargains are just a click away online. Outlets will have to adapt to this.
It’s not all doom and gloom, as outlets can adapt and embrace this change in the way we shop, safe in the knowledge that human nature dictates hordes of hungry shoppers looking for a bargain should never be far away. But as the already-enormous, digital shopping centre in the sky continues to spread, the way in which designer outlets present themselves to the public will become more important than ever.
Edward Lowcock, Account Executive