Spanish multinational outlet centre developer, landlord and operator Neinver is facing up to the current climate with a raft of strategies that underline its experience of cyclical markets.
In an exclusive interview with Retail Watch, Francisco Gutiérrez, Neinver retail director, explains all.
RW: What are the key retail industry challenges going into 2023?
Francisco Gutiérrez (FG): Today, the omnichannel consumer decides when, where and how to shop and expects companies to adapt and create shopping experiences that live up to these expectations. The key challenges for retailers are to know what their customers want, deliver relevant products and interactions and be able to evolve. The impact of the pandemic on the retail industry forced retailers to adapt quickly to changes.
New shopping formats and possibilities have emerged in the past years and retailers are paying attention to them: virtual shopping, AR shopping experiences, click and collect, personalisation.
Another challenge is to provide memorable in-store shopping experiences. Experience is at the core of the outlet concept and to continue to offer added value to brands and consumers, operators need to act, investing in gastronomy, leisure, events, bring in alternative store formats such as pop-ups or test out younger brands.
Also, the retail sector faces a retention challenge more than any other sector. Retailers need to be able to inspire teams and retain them with initiatives that go beyond the economic, from well-being to training programmes, opportunities for internal growth and so on.
Sustainability – both environmental and social – is another major challenge and an issue that is evermore present among consumers. Retailers are adapting to this new reality and setting sustainability objectives, and as such operators and brands need to collaborate to achieve these. Neinver, for example, is making big strides to help support its tenants in this regard.
RW: How do you support your tenants in practice?
FG: Our approach is based on long-term commitment and on a partnership rooted in trust, understanding and supporting our tenants’ strategies. This is a fundamental pillar of Neinver’s business model and came into its own during the recent periods of lockdown and restrictions. We actively work with our brand partners to maximise the performance of their businesses, anticipating their potential needs and advising each brand on how to best meet their goals.
There are two fundamental aspects to this partnership, the first is ongoing communication with brands and flexibility – two principles that we apply every day at all our centres in our portfolio. We also work on a more strategic level, holding annual meetings in which we propose a challenge to our brand partners, and through quarterly follow-up sessions.
The second key aspect is to provide our brand partners with intelligence and data so that they can make fact-based decisions to help offer consumers exactly what they want and improve the store performance. Our approach is to help brands understand and anticipate consumer spending patterns and we have invested in technologies that provide valuable insights that can then be used to adapt their business strategies.
RW: How do you expect stores in Neinver outlets to reflect your vision and values today?
FG: ESG is a value that is palpable in every aspect of Neinver, with our company working hard to make our centres more sustainable, inclusive and resilient. As such, it is important for tenants and operators to be aligned. We are seeing increasing interest from retailers to collaborate, encouraged both by their own sustainability strategies and by the fact that they are realising that we can support them achieve their objectives.
We are providing in-house tools to help tenants become more energy efficient and starting to advise them on the carbon reduction plans for their stores. We also support tenants by giving increased visibility to their sustainable products and campaigns. Moreover, we actively encourage green practices in terms of the visual merchandising used by stores, championing the use of recyclable and natural materials and keeping waste to a minimum.
RW: What makes outlet centres unique in the retail panorama?
FG: Today, consumers can find bargains anywhere, both online and in-store. What outlets offer goes far beyond a reduced price and “the thrill of seeking out a bargain”. Outlets are unique because they provide the right balance between product, price and experience. And that is why they have proven to be one of the most successful business formats in the retail market.
Since we opened our first outlet centre, we have continually invested in offering the best shopping experience rfor consumers, investing in aspects such as sustainable architecture, value-added services, leisure options and new technologies. As operators, we do not simply focus on price and brand mix, we appeal to the senses and pay attention to every detail no matter how small. We engage with our visitors to ensure that our centres offer the type of experiences that our visitors are looking for.
RW: What role do aspects such as F&B and leisure play in the overall outlet centre mix?
FG: Eating out is an important part of today’s leisure scene, with F&B being one of the leading trends shaping the outlet industry. Our premise is to be creative and provide value to our customer and to our centres and broaden the appeal to a wider range of potential customers. We are looking carefully into each centre’s F&B mix, adapting and enhancing the offer with the right combination of both international food anchors and local options.
In recent months we opened several new restaurants in our Barcelona outlet, Viladecans The Style Outlets, to cater for different tastes and needs, a move that has strengthened its appeal as a go-to destination and led to an improvement across all its performance metrics.
We are continuously looking at new ways to attract more customers and innovate, for instance looking into new categories, such as well-being and new leisure formulas. For example, in 2020 our Italian centre near Milan, Vicolungo The Style Outlets, welcomed a unique 1,700 m² children’s play area, the Kinder Joy of Moving park.
Two of our The Style Outlets centre in Madrid benefit from adjacent retail and leisure parks, where visitors can choose from a wide range of eateries, as well as enjoy a visit to the cinema, gym, children’s leisure parks and a bowling alley among other entertainment options. Offering a welcoming and fun experience is key to attracting consumers and achieving success in the outlet shopping industry.