Toolbox Group’s owner and founder Michelle Buxton talks about the new retail power couple of landlord and retailer and why they need to work more together on creative strategies to secure the future of the bricks and mortar retail.
As a former retailer, the relationship between landlord and retailer has always been a source of frustration and puzzlement to me. Landlords might stand firm on rental values, but the ‘relationship’ always been much more of a contractual arrangement dominated by the retailer rather than a partnership. When both parties are working to get people into their space why has this traditionally been done so apart?
Perhaps it is because in the old days, the asset plan was driven by a purely income focussed strategy – who could get the most rental income from their shopping centre. The marketing team were handed a shopping centre which performed very well on paper, but in reality from a shoppers’ perspective, provided a very mediocre offer and lack lustre shopping experience. And here’s the thing, it never really mattered before, because all centres were the same. Two words. Not. Now.
In some ways it has taken technology and a revolution in shopping channels to finally get us to realise that we need to work together – the new power couple is the retailer/landlord partnership. I am telling you that those landlords that embrace this ethos will be the most successful in the coming years.
We’re talking here about working together to understand each other’s business. For owners to fully understand the shopper behaviour and journey,the retailer is constantly adapting too, and for the retailer to understand how their landlord can be a partner in helping to develop bricks and mortar still as a profitable channel.
Shopping centres are having to understand new retail concepts and how they affect their retail mix and floor plans. Decreasing sales densities are forcing landlords to re-think their asset plan completely, and we’re seeing a rise in mixed-use development featuring experience-driving F&B and other leisure elements. By talking with retailers and understanding their business, owners can be relevant in terms of positioning and what the product actually is. For sure, it means asset teams have to be more creative and work harder but the return is a place shoppers want to visit and so a secure asset.
It is not just the Westfields of our industry who are doing this, but we’re seeing more new schemes like those we’re currently strategically advising in Copenhagen and Warsaw, that are making it their business to understand the retail environment and future consumer and technology trends in more detail.
Our award-winning platform Mallcomm is also increasingly facilitating this type of relationship-building strategy, for some of Europe’s leading landlords, but is equally helping those smaller centres improve the way the retail community works. To discuss ways in which you can build your retailer relationships contact firstname.lastname@example.org.