During the last two decades, together with my team we have conceived projects, defined strategies, articulating business plans, created names, designed brands, experiences and products in various sectors. From retail to tourism, from high consumption to services, from transportation to finance, from real estate to technology, from entertainment to destinations. In this post I will focus on the retail of the future and the shopping centers in relation to Branding. The truth is that a large part of the content is transversal to all industries. My experience in commercial spaces has been forged in different countries such as Spain, Portugal, Argentina, Italy, Colombia, Peru, Germany, France, Australia, South Africa, Poland, United States, Mexico, Belgium, Uruguay, among others.
Days ago I was invited as a speaker at the 1st International Congress of Shopping Centers in Panamá.
I was able to present projects we work on and that confirm where to go. FAN, in Mallorca, awarded the prize for the project with the best Branding in Spain. UBBO, in Lisbon, the first shopping resort in Portugal, a new way of living retail. Islazul, the largest center in Madrid, evolving it from “big” to “great” and the most sustainable in the capital; the southernmost center in the world, Paseo del Fuego, in Ushuaia, Odeón in Galicia, or the identity of Viva in Colombia, of Grupo Éxito that in a few years became a power player in the sector or also Parque la Colina, in Colombia, which in less than two years became one of the three preferred centers of Bogotans and their Social space that redefines the F&B concept.
All projects exceeding expectations of visits, sales, digital presence, customer satisfaction, offline and digital community, occupation, recommendations, etc. KPIs help “non-believers” to believe in the value of a good Branding strategy and the differentiating value of Branding. These customers who believe in the power of Branding make us believe and live that a better retail is possible, and for examples, themselves.
In this new era where everyone talks about automation, digitalization, algorithms, artificial intelligence … what we are seeing is a revival of retail and physical space and in the end what the Internet has done is for everyone to react. Even so, in Spain 8 out of 10 companies have never sold or traded anything online. Digitalization is not only how to interact with the client but also how to better manage the asset and make it more efficient and sustainable. What kind of experience do you have to give people so they leave their home? Retail has to be seen as a social experience.
What do we talk about when we talk about change?
When we talk about digital transformation we have to understand that it is social transformation and digitalization is a catalyst; A means not an end. Society is changing and digitalization has contributed to this. We use digital to humanize the relationship with our customers, we embark on the challenge of being important for people, society, the city. We embrace transcendent values and involve operators in the construction of space storytelling creating an inimitable, powerful and deeply unique personality.
Shopping centers will stop being called shopping centers. In fact, many have already done so. The concept is already old and deserves to think that a new world needs new ways of being called. The vast majority of customers and consumers see physical spaces as a place of socialization. The key word in this new era is not commercial but social.
And the social is related to passing:
From being sellers to being connectors.
From having assets to building relationships.
From attention to attraction.
From selling products to offering experiences.
From being a shopping destination to being meeting spaces.
From the financial to the human.
Most shopping centers are not building their value proposition from their brand, but those who do, however, want the brand to accompany the customer throughout their life. The biggest mistake of most companies in the industry is not considering the brand as a strategic asset.
While a large majority of shopping center companies say everything that cannot be done, another group of companies is already doing it or has already done it.
What we cannot, nor should we, is to ignore the unprecedented evolution that the industry faces. What is happening is that innovative shopping centers are becoming more popular, and non-innovators are becoming less attractive. The division between bad (irrelevant) shopping centers and good (relevant) shopping centers is expanding. Innovative shopping centers are learning some things from e-commerce companies and adopting new strategies based in data, personalization, applications, services and memorable positive experiences.
The client of the future will be increasingly social, more emotional, more selective, more connected, more demanding and multichannel.
We have been working for some time to understand the sociology, psychology and anthropology of the new client of this new era, digital, and they tell us that it is no longer enough to buy products, that they want to consume experiences, be part of the stories. Entertainment can be understood in many ways, and without a doubt, the recreation that entertainment offers, in all its variants will have an increasingly relevant role.
Creating more positive experiences and maximizing them can forge lasting relationships; allowing them to reach those emotions. There is much research in various disciplines that show that human beings are not as logical as we would like to think. Shopping centers see their customers as people who make decisions rationally, but that is only because they are not even aware of how emotion drives their behavior.
The great value of emotional benefits is that they cause a feeling of depth and satisfaction due to the brand-consumer relationship in close identification. Emotionality is the new heart of business.
Thirty years after the launch of the World Wide Web, business culture is still quite tied to see the business scenario with a look from the past. While customers integrate the changes naturally and to the physical and digital worlds perfectly and want businesses to do the same.
Digital technologies are also transforming physical spaces to companies and contrary to what many believed, physical space will not only not disappear, but its role will be increasingly prominent.
In addition to Amazon, Android, Google, Warby Parker and Bonobos have already opened physical stores. Andy Dunn, the CEO of Bonobos said “we started the company, and we said, the whole world is going to be online only. But what we have learned recently is that the experience of touching and feeling the clothes will not disappear.”
Projects do not need more data but a new mentality.
1 In general, the Shopping Center meets expectations. The reason why the need to differentiate and stand out is that almost everyone meets the standards. But the public wants more.
2 The tangible benefits are easily imitable and passenger. Instead the emotional benefits last.
3 Having an identity offers the opportunity to be different and to be recognized. The differentiation is based on those key attributes, more prominent and that are particular to that mall and that, therefore, are more difficult to imitate by the competition.
4 Demand will be related to getting preferential treatment, a greater amount of experiences, a more complete leisure offer coupled with the integration of services.
5 The Centers must be able to carefully evaluate the opportunities for income, profitability and expansion, without forgetting that the brand is a strategic asset.
6 The majority tend to think alike and this majority also tends to repeat what is said, without stopping to analyze or question or reflect on that perspective.
7 Understand that the incorporation of digital is not only about incorporating technology, but also implies a change of mentality.
8 Members of the organization must be helped to have confidence in the change.
9 The implementation of the plan must be outstanding; A good plan poorly implemented is always a bad plan.
You cannot discover a new world using old maps.
Conservatism prevents wondering things that nobody has asked, do things that nobody has done and create things that did not exist.
That the Internet, mobility and other technologies are changing the way consumers buy is something beyond doubt. Increasingly, consumers reward those brands and businesses that best suit their needs and integrate into their daily experience, want price and comfort, but also personalized experiences with individualized services and offers.
Technology is the means and the customer is the end. Excellent customer service costs less than bad customer service. We have been working on several projects not only to increase and energize the visitation time but to extend it before and after it. The new digital tools have allowed us to establish closer and personalized relationships with customers and through their devices extend the two or three hours of view to a relationship that if we add the online time can almost double.
Retail is a living industry and tenants have understood that, when operators understand that “common spaces” parking lots, corridors, bathrooms, stairs, elevators, etc., are living spaces and work is done to generate positive impacts and moments of the truth between the brand and the visitor, changes and improves the perception.
The industry needs a mental opening and finally assume that we are not in an era of change, but in a change of era, and understanding that people, not bricks, are the center of the business.
The future of spaces tends towards a world in which “Love” matters more than “Like.”
It is about creating value for those who do not seek the price as the main claim. Brands should be brave if they want to conquer people’s time. Centers are no longer competing against each other, today Netflix competes with museums, leisure parks, the battle for people’s attention is everyone’s against everyone.
Shopping centers will play a great role in the future as long as they understand that it is not enough to evolve into “smart” centers, but rather to be human spaces.
There are properties that assume that investment and constant evolution is a fundamental part of the success of your assets. There are properties that do not want (or cannot) invest in this process of permanent improvement and there are others that are between each other. And if one analyzes the market, with very specific exceptions, those assets that invest in services, in communication, in marketing, in new operators, in new value proposals, in surprising the client, in keeping the body (the building) alive and The soul (the brand) are those who are receiving the best results.
The brand is a management tool that must include all the agents involved, since it makes no sense to create a solid brand, if the workers do not identify with it. In general, a solid brand improves demand (generating higher sales volume, a higher price, reducing the dropout and dropout rate) and supply (with lower capital and acquisition costs, better economies of scale and more terms favorable for the supplier).
15 or 20 years ago the one who had the pan from the handle in this business was the owner, after the Lehman Brothers crisis it was the operator and today, fortunately, it is the client or consumer and this has caused everyone to start create more human-centered brands and spaces thinking about providing better services and added value because in the end it is about creating commercial spaces of life, encounter and entertainment. Spaces where the keyword is no longer commercial but social.
You have to think as a center and act as a brand.
If I had to summarize the future in a sentence, I would say that emotion and action should be adopted as philosophy and imagination and courage as an attitude.
Probably never before in history, to build and develop Branding with a purpose; honest, committed, inimitable and consistent had been so essential for the retail of the future. And such a good deal.