1. ICSC European Outlet Conference
Meeting the Needs of the Outlet
Customer
5th March 2014
Hilton Hotel - Wembley, London, United Kingdom
2. ICSC European Outlet Conference
European Market – 2014 Update
Kenneth Sinclair Gunn
FSP Retail Business Consultants
3. 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
Contents
4. 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
1 Turkey is considered to be separate from the core European market, and is not included in this review
Source: FSP
http://www.fspretail.com/en/demo/interactive-outlet-centre-map/
5. Openings in 2013
Source: FSP
Country Location Name Year GLA (sqm) Format FSP Type
United Kingdom Croydon Croydon Village Outlet 2013 39,400Department Store Large - Midscale
Ukraine Kiev Manufactura Kiev Outlet Village 2013 25,000Outlet Village Large - Midscale
France Paris One Nation Paris 2013 20,000Outlet Mall Medium - Upscale
Russia Moscow Fashion House Moscow 2013 15,724Outlet Mall Large - Midscale
United Kingdom London London Designer Outlet 2013 16,000Outlet Mall Medium - Midscale
Russia Moscow Vnukovo Outlet Village 2013 26,252Outlet Village Large - Upscale
Poland Warsaw Factory Annopol 2013 19,700Outlet Mall Large - Midscale
Slovakia Bratislava One Fashion Outlet 2013 15,000Outlet Village Medium - Midscale
9. Top OccupiersFISH Classification
Source: FSP
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
10. Top OccupiersTop 25 Occupiers
Source: FSP
Retailer
Country of
Origin
Merchandise
Category
FISH Price Position
# Outlet
Stores
CE.
Europe
Northern
Europe
Southern
Europe
Western
Europe
Nike USA Leisure YI Upper Middle 114 19 31 39 25
Levi Strauss & Co USA Clothing and footwear AS Middle 105 16 17 34 38
Puma Germany Leisure AS Middle 77 19 7 29 22
Adidas Germany Leisure AS Middle 74 21 16 21 16
Calvin Klein USA Clothing and footwear AF Upper Middle 69 2 7 35 25
Desigual Spain Clothing and footwear YI Upper Middle 62 4 0 31 27
Lacoste France Clothing and footwear FS Upper Middle 60 12 12 15 21
Tommy Hilfiger USA Clothing and footwear AI Upper Middle 60 14 11 16 19
Home & Cook France Household Middle 56 7 8 18 23
Tom Tailor Germany Clothing and footwear FS Upper Middle 54 15 1 4 34
Lindt Switzerland Catering Upper Middle 52 4 6 23 19
Samsonite USA Personal Upper Middle 52 7 10 17 18
Guess USA Clothing and footwear AF Upper Middle 50 5 3 21 21
Calvin Klein Underwear USA Clothing and footwear AF Upper Middle 49 1 12 18 18
Gant USA Clothing and footwear AI Upper Middle 47 9 4 13 21
Hugo Boss Germany Clothing and footwear AI Luxury 46 1 10 13 22
Geox Italy Clothing and footwear AI Upper Middle 45 7 0 20 18
Clarks United Kingdom Clothing and footwear FS Middle 44 0 27 7 10
Reebok United Kingdom Leisure AS Middle 44 14 7 14 9
Timberland USA Clothing and footwear AI Upper Middle 44 4 10 19 11
Le Creuset France Household Upper Middle 43 3 16 3 21
Triumph Germany Clothing and footwear FS Middle 42 11 4 9 18
Mango Spain Clothing and footwear AI Middle 41 13 1 17 10
Benetton Italy Clothing and footwear AS Middle 41 11 1 22 7
Villeroy & Boch Germany Household Upper Middle 40 5 12 6 17
11. Top OccupiersTop 25 Expanding Occupiers
Source: FSP
Retailer
Country of
Origin
Merchandise
Category
FISH Price Position
# Outlet
Stores
# New Outlet
Stores
CE.
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 AI 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 & BlaineItaly Clothing and footwear CI Premium 17 9 0 0 9 0
12. Top OccupiersExpanding 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
13. Top OccupiersEvolving Fashion Markets
Source: FSP
50 70 90 110 130 150 170 190
Luxury / Premium
Upper Middle
Middle
Price Position Index
C.E. Europe Northern Europe Southern Europe Western Europe
(100 = Existing Regional Provision)(100 = Existing Regional Provision)
40 60 80 100 120 140 160
Young
Assured
Family
Classic
FISH Lifestage Index
C.E. Europe Northern Europe Southern Europe Western Europe
(100 = Existing Regional Provision)(100 = Existing Regional Provision)
15. Planned 2014 / 2015 Openings
Source: FSP
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 Stříbro 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
19. Satisfied Customers Reward Outlet Centres
FOC
%
Respondents
Annual
Visit
Frequency
Average
Spend Per
Visit €
Promoters 50% 15 68
A Detractors 11% 9 49
Potential Uplift 73% 40%
Promoters 15% 7 117
B Detractors 26% 6 93
Potential Uplift 16% 26%
Promoters 36% 8 70
C Detractors 27% 4 47
Potential Uplift 77% 49%
Promoters 21% 5 163
D Detractors 10% 3 120
Potential Uplift 43% 36%
• Survey research at 4 Outlet
Centres across Europe
• Promoters and Detractors
defined using response to
Net Promoter Score question
• 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
20. • 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?
Meeting the Needs of the Outlet Customer
22. • 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
Conclusions