Saturday 27 February 2010
I-AM ensures that the shopping centre brand is aligned with customer pricing perceptions and so would adapt to local conditions and costs. By analysing customer shopping patterns (in association with retailers) the pricing of rental and other charges can be identified and increased or decreased depending on affordability. This more flexible pricing policy will allow for greater variety of shops and move away from the traditional zoned rental model that fails to differentiate between uses. But it only works where retailers recognise the need for mutuality and where they cooperate fully in providing (sensitive) business information that can help their business, and therefore the landlords, prosper.
What’s wrong with win-win?
Feel free to comment.
MIke.
Yvonne Court of Cushman’s in my view is one of the most consistent research consultants in the industry. In today’s Property Week she reckons the time has come for retail property to reinvent itself. Taking a look at my previous blogs you’ll see how we intend to do just that.
But one quote stood out for me: “The challenge ahead for retailers will be how to continue to develop their businesses in a market where there is a dearth of good-quality retail space and a significantly reduced development pipeline, particularly beyond 2012”.
Landlords are similarly struggling to deal with rental deflation and a lease expiry bubble in about 6 years time is simply adding to the misery. Because successful retailers underpin successful shopping centres the industry needs to realise that keeping customers captive (L&T Act ’54) is simply old-fashioned – setting them free will sharpen up your marketing skills and keep them coming back. Turnover rents are the new black.
I-AM sees both sides of the argument and is trying its hardest to persuade landlords that working with tenants is far more productive for both businesses in the post-recession, post-Google post Tesco Clubcard age. The game has changed.
So, to help owners and occupiers in secondary shopping centres “develop their businesses”, here’s what we’d do to add value.
1. We’d streamline
2. We’d inspire
3. We’d Innovate
4. We’d surprise
5. We’d modernise
Because our ideas are built on information, these benefits would all be measurable. Doing more of what works and less of what doesn’t soon becomes a darn sight easier.
Feel free to comment,
Mike.
Saturday 20 February 2010
It’s suddenly beginning to dawn on me that what we’re seeing now – in business generally – is the digitalisation of process. A necessary cleansing of systems and processes that are no longer able to compete in their traditional way – no longer fit for purpose in the 21st Century.
Kind of like the current fund/asset/property/centre management process for shopping centres. So I wonder if we’ll refer to the halcyon days of easy shopping centre pickings as “Before Google” and the apocalyptic post-recession landscape as “After Google”.
After all, Google is about 12 years old now, and the last of the 25-year leases for unit shops were signed in or around the mid-1990’s. Is that a coincidence or a correlation?
I have a feeling that investors are pretty soon going to be asking some searching questions of their fund managers. “What are you doing to drive real and absolute performance, and how are you managing risk?”
All change I think…what’s your view? Just a thought really, but as Neil Young once sang “It’s easy to get stuck in the past when you try to make a good thing last”.
Feel free to comment.
Mike.
75% of all UK wealth is owned by the over 65’s.
65% of those over the age of 65 are women.
75% of those over the age of 75 are women.
85% of those over the age of 85 are women.
What is your asset manager advising you do, as a shopping centre owner or investor – or indeed occupier – to address this issue of change?
Or are your over-paid marketing people just reheating the same old stuff and charging you through the nose for it?
Unless you try something different, how do you ever expect to get a different result??
Feel free to comment.
Mike.
Saturday 13 February 2010
The (2ndary) shopping centre industry has failed because it saw itself in the shopping centre business, not in the “Community” business.
Feel free to comment.
Mike
Monday 8 February 2010
Ever stopped to wonder why the Internet and the supermarkets seem to be destroying competitors that aren’t digitally empowered? Ever thought about the growing divide in digital between those that can (do Facebook) and those that can’t, and how it will impact on the future performance of your shopping centre?
More than ever before customers hold the upper hand in their relationship with shopping centres:
* it’s never been easier for them to switch
* there’s never been as much competition for a share of their wallet
* they are empowered in their research and opinion sharing
* their service expectations are higher than ever
* they can demand relationships on their terms
How can shopping centres effectively engage with the “Next Generation Customer”?
For practical methods that increase loyalty, trust, retention and advocacy, why not give us a call, we’d be delighted to help.
Comment is free, so please do so.
Mike.
Tuesday 2 February 2010
The poor financial performance of secondary shopping centres, by now, is self-evident. Falls of 44% on average tells its own story – asset managers did little to fix the roof when the sun shone. Still, as long as they’re not doing worse than their peers, they’ve always got an excuse to continue to do what they’ve always done. It is however a question of time before their shareholders begin to question this lousy performance. Meanwhile, here at I-AM, we’re refining our work on what the new model of asset management looks like.
We predict that doing “more with less” will be the mantra for the next decade. But trying to get extra productivity out of shopping centre workers worried about the future will not be easy. Right now there is little, if any, traditional “performance management” in the shopping centre industry. The FT’s Stefan Stern says “The recession has tested some basic management skills and found them wanting”.
Employees cannot be battered into producing more: they have to be persuaded. Managers will therefore need to be able to tell a convincing story about the future. At the same time useful technology needs to be implanted into the process of management so that knowledge can be used to drive financial performance. Empowered managers, furnished with the right information at the right time, have the knowledge to act, and are happier and more confident to do so.
There’s no doubt that investment risks will remain high if the same-old model continues to be used, especially with the lease expiry bubble that looms. This can only ever produce the same-old results. So in the 21st century we will have to work harder and smarter.
In Stern’s words “That means efficiency savings and increased productivity. It is the great management challenge of the age”.
The bottom line: if you aren’t part of the solution, you’re part of the problem.
Feel free to comment.
Mike.