Shopping Centre
The lattè factor
A number of stark warnings were issued at this year's BCSC conference. John Dunn reports
Published:  13 November, 2007
Page 4 

Britain is beginning to see a drop off in interest in consumer brands and a backlash against those jumping on the green bandwagon. And as the gap between the very richest and the poorest continues to widen and polarise society, it is becoming harder to predict what is going to happen. But one thing is for sure: we are terrified of teenagers and we want to be safe and happy. Good architecture could help.

These stark warnings to the retail industry to buck up its ideas and really get to know its customers came as over 3,000 delegates gathered at The Sage, Gateshead in November for BCSC's 21st annual conference and showcase.

"Consumers are defining themselves less and less by the brands they buy and we are beginning to see a drop off in interest in consumer brands," warned Christopher Sanderson, creative director of Viewpoint and co-founder of The Future Laboratory.

"A significant 10 per cent of us avoids buying brands whenever we can. A significant minority just do not want anything to do with the idea of branding and what branding stands for," he said.

Also, consumers were losing faith in green claims. "We are seeing the start of a backlash against brands that seem to be jumping on the green bandwagon." In a recent survey, said Sanderson, 28 per cent of consumers said they no longer trusted brands to tell the truth ? up from 22 per cent six months ago. Brands and retailers have to understand that the efforts they make to be 'green' have to be seen as real, he said.

His company has now identified a large, new group of consumers which Sanderson called the Middle Path Realists. Representing about 45 per cent of consumers, they show an unwillingness to turn a blind eye to unethical practice, he said. "But equally they are unwilling to pay a premium for ethical goods."

We have to get better at understanding and anticipating consumers' needs and desires, said Sanderson. Brands and retailers have to consider the Latte factor ? consumers wanted products that were Local, Authentic, Targeted, Trustworthy and Ethical.

British society was not becoming more homogenous, it was becoming more divided in all sorts of ways, said Ben Page, director of Ipsos MORI. The gap between the very richest and the poorest was now almost wider than during Edwardian times. "We now have the haves, the have nots and the have yachts." The result, he suggested, was that it was becoming increasingly difficult to predict what consumers were going to do.

"However, one thing I can guarantee you is a longer life: you will live longer than your parent's generation. But you will be iller, you will be fatter ? and so will your pets." There was a very strong relationship between adult human obesity and pet obesity, said Page.

However, what is clear, he said, is that society is more affluent but also much more worried ? worried about everything from immigration and the environment to teenagers.

The result, said Page, was the rise of happiness ? people wanted things that assured them. There were 80,000 books on Amazon dedicated to happiness, to 'affluenza', he said. "It's not about making money anymore, it's about wellbeing. Money on its own will not guarantee happiness, but you need a certain amount. In this country it is about £30,000 a year."

So what can we do to be happy? "First get married. Then find some poor people and hang around with them. Get religion. Spend time with your friends. Get a degree. Go and get your prostate checked (for men) and eat your five portions of veg. And finally, avoid middle age. One of the most depressed groups of people in Britain are aged between 40 and 60.

"These are the things that I guarantee that if you try them, you will be happier than if you don't."

However, if you want to be truly happy, don't have teenagers, advised Page. The results of numerous studies all told the same sad story, he said. "Having teenagers is very depressing. The evidence is overwhelmingly compelling: teenagers are a problem. We are terrified of our teenagers."

However, the good news was that good architecture could make us feel safer and happier. "There are 700 studies that prove the links between architecture and wellbeing, that the built environment can make you happy," said Page. "Places that are good-looking make people happier. And studies show that better thought-out shopping streets demand higher retail rents."


Densification is the new word for mixed-use

For decades mixed-use has been a byword in the US for failed developments. So John Bucksbaum, chief executive of General Growth Properties, preferred to call it densification. With some 200 regional shopping malls in the US, General Growth Properties had begun a programme of densification to maximise its income from its 200 million sq ft of retail space by bringing residential, hotel and office space on to its sites.

The company has identified over 50 of its retail properties that could support hotels, generating a possible $130m of revenue in ground lease rent if it were successful. Similarly, it has identified a number of its sites that could support around 22,000 apartments with a projected sales value of $18bn.

Ultimately, said Bucksbaum, densification could provide the firm with up to $250m of extra operating income.

The driver behind densification, said Bucksbaum, was that people were tired of commuting to work from the suburbs, yet they liked the excitement of 24/7, city-style living. Suburban communities were looking for all the convenience of city life without having to go into the city. And regional shopping malls offered a hub around which to attract developments such as residential, hotels and office space at a premium over inner city rents and prices, said Bucksbaum. And since General Growth Properties owned the land, development was relatively cheap.

At its Ala Moana shopping centre in Honolulu, for example, General Growth Properties was looking to build 250 condominium units on its site which Bucksbaum reckoned would attract a 20-50 per cent premium over central Honolulu accommodation. Similarly at The Woodlands, a master-planned community on the outskirts of Houston, Texas, residential housing was going for $250-400 psf compared to £115 in central Houston. And the Marriott Hotel had an average room rate of $160 and greater occupancy, compared with a typical city room rate of $137. "Densification is the next generation of growth," he said.



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