ICSC ďťż
European Outlet Conference
Meeting the Needs of the Outlet Customer 5th March 2014 Hilton Hotel - Wembley, London, United Kingdom
ICSC
European Outlet Conference
European Market – 2014 Update Kenneth Sinclair Gunn FSP Retail Business Consultants
Contents European Outlet Centres Today • • •
Current position Recent Expansion Historic Development Activity and Current Capacity
European Occupiers Today • • •
Top 25 Occupiers Expanding Occupiers Evolving Markets
Looking Ahead • • •
Planned 2014 & 2015 developments Historic Trend Capacity
Meeting the Needs of the Outlet Customer Conclusions
Current Position •
193 outlet centres1 >3k m2
•
Total GLA 3.3million m2
•
Turnover of €10.8bn
•
184 are over 5,000m²
•
155 are over 10,000m²
•
66 are over 20,000m²
•
Excluding Russia, 70% of the European population (controlling 73% of total purchasing power) lives within 90 minutes’ drive of an outlet centre http://www.fspretail.com/en/demo/interactive-outlet-centre-map/ Source: FSP 1
Turkey is considered to be separate from the core European market, and is not included in this review
Openings in 2013 Country
Location
Name
Year
GLA (sqm)
Format
FSP Type
United Kingdom Croydon
Croydon Village Outlet
2013
39,400 Department Store Large - Midscale
Ukraine
Kiev
Manufactura Kiev Outlet Village
2013
25,000 Outlet Village
Large - Midscale
France
Paris
One Nation Paris
2013
20,000 Outlet Mall
Medium - Upscale
Russia
Moscow
Fashion House Moscow
2013
15,724 Outlet Mall
Large - Midscale
United Kingdom London
London Designer Outlet
2013
16,000 Outlet Mall
Medium - Midscale
Russia
Moscow
Vnukovo Outlet Village
2013
26,252 Outlet Village
Large - Upscale
Poland
Warsaw
Factory Annopol
2013
19,700 Outlet Mall
Large - Midscale
Slovakia
Bratislava
One Fashion Outlet
2013
15,000 Outlet Village
Medium - Midscale
Source: FSP
Historic Expansion 350000
Floorspace Added (m²)
300000 250000
200000 150000 100000 50000 0
C. E. Europe
Northern Europe
Southern Europe
Western Europe Source: FSP
Current Position – Development Capacity
Source: FSP
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European Outlet Conference
The Occupier Market
Top FISHOccupiers Classification Fashionable – Demonstrates fashionability
Individual – demonstrates taste beyond transitory fashion
Safe – ‘value for money’ merchandise with good enough performance
Homely – Items are bought purely for replacement. Price is important for goods whose main attribute is utility
Young – peer pressure to conform is strong and fashion is a powerful identifying statement Assured– able to make up own mind and sophisticated in choice
Family – dominated by the financial considerations of running the home and caring for the family Classic – typically Post-Family. Many similarities with Assured but less self confidence about the ‘rightness’ of purchase decisions
Old – ‘given up’. Not seeking to make a statement about themselves through their purchases Source: FSP
Top Occupiers 25 Occupiers Retailer Nike Levi Strauss & Co Puma Adidas Calvin Klein Desigual Lacoste Tommy Hilfiger Home & Cook Tom Tailor Lindt Samsonite Guess Calvin Klein Underwear Gant Hugo Boss Geox Clarks Reebok Timberland Le Creuset Triumph Mango Benetton Villeroy & Boch
Country of Origin
Merchandise Category
USA USA Germany Germany USA Spain France USA France Germany Switzerland USA USA USA USA Germany Italy United Kingdom United Kingdom USA France Germany Spain Italy Germany
Leisure Clothing and footwear Leisure Leisure Clothing and footwear Clothing and footwear Clothing and footwear Clothing and footwear Household Clothing and footwear Catering Personal Clothing and footwear Clothing and footwear Clothing and footwear Clothing and footwear Clothing and footwear Clothing and footwear Leisure Clothing and footwear Household Clothing and footwear Clothing and footwear Clothing and footwear Household
FISH
Price Position
# Outlet Stores
CE. Europe
Northern Europe
Southern Europe
Western Europe
YI AS AS AS AF YI FS AI
Upper Middle Middle Middle Middle Upper Middle Upper Middle Upper Middle Upper Middle Middle Upper Middle Upper Middle Upper Middle Upper Middle Upper Middle Upper Middle Luxury Upper Middle Middle Middle Upper Middle Upper Middle Middle Middle Middle Upper Middle
114 105 77 74 69 62 60 60 56 54 52 52 50 49 47 46 45 44 44 44 43 42 41 41 40
19 16 19 21 2 4 12 14 7 15 4 7 5 1 9 1 7 0 14 4 3 11 13 11 5
31 17 7 16 7 0 12 11 8 1 6 10 3 12 4 10 0 27 7 10 16 4 1 1 12
39 34 29 21 35 31 15 16 18 4 23 17 21 18 13 13 20 7 14 19 3 9 17 22 6
25 38 22 16 25 27 21 19 23 34 19 18 21 18 21 22 18 10 9 11 21 18 10 7 17
FS
AF AF AI AI AI FS AS AI FS AI AS
Source: FSP
Top Occupiers 25 Expanding Occupiers Retailer
Country of Origin
Merchandise Category
FISH Price Position
# Outlet # New Outlet CE. Stores Stores Europe
Northern Europe
Southern Europe
Western Europe
Levi's
USA
Clothing and footwear
AS
Middle
105
20
4
1
7
8
Sunglass Hut
Italy
Personal
AI
Premium
18
17
0
7
9
1
Asics
Japan
Leisure
AI
Middle
39
16
1
6
4
5
Geox
Italy
Clothing and footwear
AI
Upper Middle
45
14
2
0
7
5
Puma
Germany
Leisure
AS
Middle
77
12
3
2
2
5
Lacoste
France
Clothing and footwear
FS
Upper Middle
60
12
6
3
2
1
Villeroy & Boch
Germany
Household
CI
Upper Middle
40
12
1
7
1
3
Crocs
USA
Clothing and footwear
FS
Middle
23
12
1
4
5
2
Fossil
USA
Personal
AI
Middle
28
12
0
6
2
4
Adidas
Germany
Leisure
AS
Middle
74
11
5
3
2
1
Guess
USA
Clothing and footwear
AF
Upper Middle
50
11
3
1
2
5
Swarovski
Austria
Personal
AS
Upper Middle
19
11
0
3
3
5
Desigual
Spain
Clothing and footwear
YI
Upper Middle
62
10
1
0
5
4
The Body Shop
United Kingdom Personal
FS
Middle
26
10
0
5
1
4
Lindt
Switzerland
Catering
Upper Middle
52
10
1
4
1
4
Mustang
Germany
Clothing and footwear
Middle
32
10
7
0
1
2
Samsonite
USA
Personal
Upper Middle
52
10
4
1
2
3
Quiksilver
USA
Clothing and footwear
YI
Middle
35
9
5
0
1
3
Harmont & Blaine Italy
Clothing and footwear
CI
Premium
17
9
0
0
9
0
AI
Source: FSP
Top Occupiers Expanding Occupiers in Key Markets
Rank
France
Germany
Italy
Poland
Spain
United Kingdom
1
Nydel (+5)
Watch Station (+5)
Harmont & Blaine (+9)
Brugi (+7)
Sunglass Hut (+8)
Gift Company, The (+8)
2
Geox (+4)
Esprit (+3)
Geox (+6)
Hi-tec (+6)
Flamenco (+4)
Sunglass Hut (+7)
3
Izac (+4)
Guess (+3)
Yamamay (+6)
Scotfree (+6)
Asics (+3)
Villeroy & Boch (+7)
4
Acanthe (+3)
Cecil (+3)
Michael Kors (+5)
Tom Tailor (+4)
Crocs (+3)
Blue inc (+7)
5
Desigual (+3)
Levi's (+2)
Alcott (+5)
Albione (+4)
Burger King (+3)
Asics (+6)
6
Devianne (+3)
Fossil (+2)
Brums (+5)
Mustang (+3)
Simone Perele (+3)
Fossil (+6)
7
Levi's (+3)
Napapijri (+2)
Primigi (+5)
Quiksilver (+3)
Belros (+3)
Radley (+6)
8
Little Marcel (+3)
Asics (+2)
Levi's (+4)
Tommy Hilfiger (+3)
Forecast (+3)
Viners (+6)
9
Mariner (+3)
Puma (+2)
Bottega del Sarto (+4)
Filippo (+3)
Xti (+3)
Body Shop (The) (+5)
10
Aigle (+2)
Seidensticker (+2)
Camomilla (+4)
Regatta (+3)
Levi's (+2)
Bellissimo (+5)
Source: FSP
Top Occupiers Evolving Fashion Markets FISH Lifestage Index
Price Position Index
(100 = Existing Regional Provision) 40
60
80
100
120
140
(100 = Existing Regional Provision) 160
50
70
90
110
130
150
170
190
Young Luxury / Premium
Assured
Upper Middle
Family
Middle Classic
C.E. Europe
Northern Europe
Southern Europe
Western Europe
C.E. Europe
Northern Europe
Southern Europe
Western Europe Source: FSP
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European Outlet Conference
Looking Ahead
Planned 2014 / 2015 Openings Country
Location
Name
Year
GLA (sqm)
Denmark
Copenhagen
Copenhagen Designer Outlets
2014
17,500
Germany
Bad Munstereifel
Eifel City Outlet
2014
12,000
Italy
Brugnato
Shoppinn Brugnato
2014
22,000
Poland
Lublin
City Outlet Lublin
2014
11,500
Czech Republic
StĹ™Ăbro
Bohemia Village
2015
16,000
Denmark
Billund
Billund Quality Outlets
2015
20,000
France
La Cavalerie
Viaduc Village
2015
5,988
Germany
Leipzig
Fashion Outlet Leipzig
2015
17,500
Germany
Koblenz
Montabaur Fashion Outlet
2015
14,500
Poland
Bialystok
City Outlet Bialystok
2015
14,500
Russia
St Petersburg
Outlet Village Pulkovo
2015
25,000
Russia
St Petersburg
Fashion House St Petersburg
2015
20,260
Russia
Yekaterinburg
Fashion House Yekaterinburg
2015
18,000
Spain
Barcelona
Viladecans The Style Outlets
2015
25,000
United Kingdom
Solihull
Resorts World at the NEC
2015
14,362 Source: FSP
Future Position – Development Capacity
Opening 2014/15 Source: FSP
Planned Expansion 350000
Floorspace Added (m²)
300000 250000 200000 150000 100000 50000 0
C. E. Europe
Northern Europe
Southern Europe
Western Europe
Source: FSP
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European Outlet Conference
Meeting the Needs of the Outlet Customer
Satisfied Customers Reward Outlet Centres • •
•
•
•
Survey research at 4 Outlet Centres across Europe Promoters and Detractors defined using response to Net Promoter Score question
Annual % Visit Respondents Frequency
FOC
Average Spend Per Visit €
A
Promoters Detractors Potential Uplift
50% 11%
15 9 73%
68 49 40%
B
Promoters Detractors Potential Uplift
15% 26%
7 6 16%
117 93 26%
C
Promoters Detractors Potential Uplift
36% 27%
8 4 77%
70 47 49%
D
Promoters Detractors Potential Uplift
21% 10%
5 3 43%
163 120 36%
Sites B and C under perform
Site D has low proportions of Detractors but converting more visitors to Promoters would bring huge benefits Across all 4 sites, changes which convert visitors from Detractors to Promoters would increase visits by 50% and average spend by 40%
Source: FSP
Meeting the Needs of the Outlet Customer • Success is determined by how well we meet the needs of customers • Promoters visit more often and spend more per visit than Detractors • Opportunities exist to increase sales by 25% to 50% at most outlet centres. This makes the sector attractive to new investors • Growing outlet provision, on-line shopping and discount high streets mean that in 2014/15 consumers have greater choice than ever • It is important that outlet centres maintain their competitive advantage by going beyond and not just simply meeting the needs of customers • This is about integrating good design, marketing, leasing and operational activity to focus on the complete customer experience • The best performing outlet centres in the next 24 months will be those which recognise this and deliver a ‘great day out’ visitor package • Every outlet location is unique, so if you want to know how to create the ideal visitor package, why not ask the customer?
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European Outlet Conference
Conclusions
Conclusions • 2013 was another strong year for European Outlet Centres • Development activity continues to infill gaps in the outlet map and to challenge conventions on what is a sustainable level of provision • There are over 200 trading outlet centres in Europe which encompass a variety of formats, price positions and locations • Current development activity is focused in Germany, Central and Eastern Europe. Elsewhere, there are opportunities to infill under developed regions including the UK (Midlands/SE), France (Lyons, Provence) and Spain (Catalonia) • There is scope for further development of 50 and 75 new outlet centres suggesting that the pace of growth will continue for years to come • As the map fills and competition strengthens, we need to go beyond meeting the needs of customers and exceed their expectations • An insight based, integrated approach is now essential for success