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In-depth: the shopping centres thriving in the retail down turn

Tom Bottomley
19 July 2019

While shopping centre operators have taken a £2.7 billion hit in the last year due to struggling retailers and CVAs aplenty, as recent figures from Growthdeck Property’s investment arm have revealed, there are certain centres that are bucking the trend and fighting back with investment, innovation and appeal to their local audiences.

Liverpool ONE and centre:mk in Milton Keynes are two such centres that are seemingly on the up, and rising to the new retail challenges in the digital age. Indeed, centre:mk’s footfall enjoyed a total footfall increase of 3.4% to 25 million a year, and increased footfall of 6.5% year on year since the opening of Primark’s latest store in the shopping centre. It must be doing something right.

“Across the retail landscape it’s crucial that shopping centres focus on creating a brand experience that consumers can’t get online,” says Kevin Duffy, centre director for centre:mk.

centre:mk

centre:mk at Christmas

“According to the ‘Future Shopper Report’, commissioned by the co-owners of centre:mk, by 2025 future shoppers will see retail destinations as a key source of optimisation. They will expect to find products, services and spaces that will keep them at the top of their game. These consumers are on the look-out for optimisation of their time and innovative sales techniques – which is at the forefront of centre:mk’s retail strategy,” he adds.

Duffy points to the modern necessity of “enhanced brand experiences”, and he is a firm believer that retailers need to embrace online shopping and evolve their offer, creating an omnichannel experience where one medium can benefit the other. “We put a strong focus on centre:mk catering to the new breed of consumer that is emerging as a result of evolving technology,” he adds.

As a dominant shopping destination in the region, centre:mk has developed a mix of retail, dining and leisure brands with a peak average spend of £238 per visit, compared to a shopper dimensions benchmark of £138.

It’s a similar story at Liverpool ONE, as the good people of Liverpool – and those visiting the north west city – clearly like to get out and about if there’s something worth visiting where they will spend their hard-earned money.

Shopping centres Liverpool ONE

Peter's Lane: part of Liverpool ONE

Alison Clegg, director of asset management of Liverpool ONE owners Grosvenor Europe, says: “A retail and leisure destination should focus on continually evolving its offer, to guarantee visitors the best experience possible to outshine online alternatives and want to spend a whole day in our environment.

“Alongside activations, we also strive for this with a strategic and a well-rounded tenant mix incorporating premium brands, competitive leisure sites, and even an upcoming luxury hotel.”

Clegg knows full well that despite the rapid growth of online shopping, it cannot match bricks and mortar in terms of experience. And, by investing in a dedicated calendar of enlivenment programmes, interactive campaigns and immersive activations, they are able to ensure that Liverpool ONE is more than just a destination for retail.

“We know that, increasingly, visitors are more considered in the way they spend their time and money,” she offers. “As the market and consumer expectations evolve, Liverpool ONE consciously selects brands with a strong digital presence, whilst recognising the power of physical retail. Strategically we have a well-rounded tenant mix, incorporating premium brands, competitive leisure sites - such as Junkyard Golf, and even an upcoming luxury hotel.

“As a result, we’ve been able to successfully create retail zones that cater to all our visitors, and ensure our tenant mix best aligns with our catchment, as well as those from further afield.”

The success of Liverpool ONE comes down to an understanding of its customers, and what they truly want. “The retail environment can be tough, but we believe a better and more sophisticated shopping format will prevail – and Liverpool ONE is just that, marrying a strong mix of international brands and regional flagships alongside local and more niche labels.”

Clegg also says they have been turning to brands that have a strong social media presence, and those who take a fresh approach to store concepts and the way they target their customers. Liverpool ONE has attracted regional flagship stores for popular fashion brands such as Arket and COS, plus the most talked about Instagram-hyped beauty brand, Morphe.

“The most important thing regarding digital is not to try to compete with it,” she comments. “Liverpool ONE’s strategy is to learn how to harness the power of digital to create memorable experiences and bring visitors back again and again. Rather than a threat, we believe digital is a tool which can assist and improve everything we do.”

Kevin Duffy talks of guest experience, genuine retail sales and commercial income being key to a successful shopping centre. “We are dedicated to the quality of activations and promotions we provide, with 170 days of events taking place in Middleton Hall last year,” he says.

“The centre’s Middleton Hall is a community hub for events, hosting activities such as the Milton Keynes International Festival, Style Fest, The Beach and Santa’s Grotto. Style Fest welcomed 166,000 guests last year to a weekend of catwalks, talks and beauty demonstrations.

Centre:mk

A fashion show at centre:mk

“Our investment into guest services demonstrates our drive for a superior guest experience, with centre:mk named one of the UK’s top 10 shopping centres, performing exceedingly well in the ‘meeting shopper expectations’ category.”

According to Duffy, 78% of shoppers say the top reason for staying loyal to a retail destination is staff with a deep product knowledge, so the centre ensures success by investing time into its employees, organising and curating workshops to better their relationships with guests.

“Investment is the key to staying relevant and centre:mk is constantly investing and developing its assets, with the £30m technologically advanced car park being our latest project,” he says.

“The commitment to regeneration has spread to our tenants, with brands investing a combined total of £3.7 million between them into their stores. It is vital to ensure a retail destination keeps up-to-date with consumer expectations and offers a first-class experience to all visitors.”

Duffy is another advocate of the idea that there is increasingly a “blurring of the line between online shopping and bricks and mortar retail.” He says the power of click-and-collect also goes a long way, and they have worked hard to incorporate brands into the mix that offer a click-and-collect service.

“We have worked hard to create a streamlined experience for our guests, with click and collect services and dedicated digital platforms, centre:mk’s bricks and mortar environment is bolstered by its use of technology.”

A good example of this new approach is Amazon’s recent announcement of its partnership with Next – launching a delivery option that will let guests retrieve parcels from staffed counters. This streamlined process will be a valuable asset, which will continue to draw people out of their homes and into the centre. And that’s what it’s all about.

For essential data, such as footfall, number of units, key retailers, key executives and the social media statistics of dozens of the UK's leading shopping destinations, visit our master database of fashion, The Intelligence


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