November 23, 2015 | Bart Waldeck
Exploring Retail Trends and Opportunities at MAPIC 2015
Last week, Tango had the opportunity to journey to Cannes, France – famous for its annual film festival - to attend and exhibit at MAPIC 2015. MAPIC is an international retail real estate show focused primarily on the European market. More than 20 years old, the show hosts about 8,400 participants, including 2,400 retailers. In light of the horrific events in Paris, we had real concerns – but really wanted to show our support. As a testament to the French people’s resolve and spirit, and an unwillingness to give into fear or intimidation, the show went off without a hitch.
The show provided the opportunity to meet with dozens of retailers, including some of the largest and best known European, Middle-Eastern and African retail brand
With the recent announcement that it’s been a banner year for the European retail sales, we observed some interesting trends at the show. And they had one common thread; they emphasized the importance of having access to customer and location predictive analytics to help inform all your real estate strategy and execution decisions.
The expansion of smaller retailers – perhaps driven by wage growth and the resulting renewed consumer appetite to spend, smaller retailers are seeking opportunities to expand both within existing markets – and into new markets. Given their size, their next five locations can be their make or break point – so it’s critical for them to get everything right – from their market planning, to their selection and build out of sites – and their ongoing management.
Over-Development of Shopping Malls
Most recently seen in India, this trend is now happening in other markets, such as Turkey. In India, shopping malls were overdeveloped in response to escalating economic growth. "There was an initial euphoria and a herd mentality in developing malls," explains Shubhranshu Pani, managing director of retail services for Jones Lang LaSalle India, a real estate consultancy in Mumbai. When the global recession hit, spending tapered off. "The retailers started realizing that consumption is not able to sustain rents," he says. Expansion was indiscriminate and lacked planning – and a similar situation is taking place now in Turkey and other European markets.
Increasing Interest in Customer Analytics
Customer Analytics is a growing area in Europe, where the market is significantly less mature than in the US. In part, the issue has been a lack of access to quality data. In our experience, the ability to profile customers across real estate, marketing and merchandising ensures better alignment of customer dynamics and your real estate strategy, not to mention the role omnichannel activities play in maximizing sales.
We talked to many retailers and restaurant companies about our partnership with UberMedia. Our combined ability to accurately identify the trade show of a store was of great interest as it will help bridge the data gap in the European market – in particular for companies that struggle to get accurate customer data. By marrying our customer analytics capabilities with UberMedia’s mobile data points, retailers are better able to understanding shifting customer dynamics – and can take that knowledge and factor it into their evolving real estate strategy
All in all, MAPIC was a terrific show. In addition to a great opportunity to meet with local retailers and better understand the issues they face, it also provided an excellent primer on the challenges and the opportunities for this market.