Last week, as part of Auckland Council’s Auckland Conversations series, HOTCity hosted a seminar for CBD Retailers with Robert Gibbs about what ‘mainstreets could learn from the mall’, along with some tips about the science of good retailing. A group of 40 or so HOTC members enjoyed the presentation, and we had good feedback about the value of events like this to HOTC businesses. Whilst Robert’s point of view was very much through American eyes, there were some key takeaways that were a useful reminder.
He noted that one of the biggest challenges (and opportunities) for a Mainstreet environment is that there is not one single entity governing the operation of the street and businesses within it. This can make it difficult to ensure a cohesive look and feel, the right tenancy mix, and consistency of operations such as opening hours. Yes, the unique, distinct, shopping experiences are what make town centres and mainstreets great, and the very reason we love them, but the downside is a perceived lack of cohesion, inconsistent retail hours and look and feel of store frontages, and an unpredictable operating environment.
What we also heard from Robert was the ‘science’ of best practice retailing. For many of our retailers the ideas were just reaffirmation of current practices - but a useful reminder all the same.
At a basic level, having:
- clean, clutter free and compelling windows
- simple, effective signage
- an enticing table display in view of the front door, and considered placement of goods to get people circulating around the store
- opening hours that reflect consumer needs, will all contribute to enticing customers into store.
One of the most interesting facts that we heard was that in America, last year, 75% of retail sales took place after 5.30pm and on Sundays. Something for us to consider?
Overall, making it easy for people to get to the front door of businesses, getting them to enter, and then to buy product is really what it’s about. Sounds so simple. We are some way there to improving the City Centre’s access challenge – our Citylink provides a simple solution to getting people up and down Queen Street, and we continue to work with Auckland Transport to market and promote our city’s off street carparking offer. But there is some way to go…
At a broader level we also heard of the possible threat from ‘lifestyle centres’ (malls without roofs) to mainstreet retailers. The challenge from Robert to Council was to determine what role town centres should have in terms of the marketshare vs other retail centres such as malls. In the US town centres typically have a 5% marketshare. We too challenge Auckland Council to articulate the importance of town centres through the Auckland Plan process.
The biggest strength of the Auckland CBD, according to Robert, was the mix of retail, civic spaces, department stores and places for dining and socialising. This is where a high street can really outperform a mall. People come to the CBD more for an experience, less for a simple routine purchase. The mix of experiences that we can offer is something we can work to leverage.
Given that Robert’s view was very American, we thought it relevant to look to the UK for comparison. There has been much discussion about the Mary Portas report, published in late December 2011. The report and support research is extensive, recognising the challenges that the UK High Street is facing, and this is no surprise to us. As well as offering up recommendations for the future, when taking into consideration the declining performance of the High Street, the report cites drops in foot traffic, retail spending and increased vacancy rates as indicators.
So how is the Auckland City Centre performing in relation to the UK High Street?
Vacancy Rates
In research completed by CBRE for HOTCity in the middle of last year, City Centre Retail Vacancy Rates have improved. We’re currently sitting at 4.7%, down from 7.7% in 2009. By comparison, across the UK, High Street vacancies were sitting at 14.4% in October 20101.
Spending
For the 12 months ending December 2011, the CBD’s value of spending was up 2.4% vs the same 12 months a year ago. By comparison, the CBD’s competitors were down 0.4% for the 12 months ending December 2011.
Foot Traffic
We are hoping that with our new electronic pedestrian counters (link to the other story) we will be able to have a more thorough understanding of foot traffic. Like the UK we have limited research on this, and in NZ we have until recently been limited to one day ‘snapshot’ pedestrian counts. In 2010, the PINZ Foot Traffic counts in the CBD were 32,615 across all sites, a slight decrease from the 35,691 in 2009, and 33,314 in 2008. By comparison, the UK research cites a 10.4% decrease in foot traffic over the past three years.
Overall
We think that the City Centre is in pretty good ‘health’, particularly when we compare it to the UK. The biggest challenge for us going forward is to get our planning right. We must determine the role of the Town Centres and mainstreets in the context of the Region, continue to reinforce the role of the City Centre as a unique, diverse retail offering and an area that also has a cultural and social proposition.– this is what really sets us apart. If we do this, and take steps where possible to use Robert’s advice about creating a customer-focussed shopping environment, we will be on a best practice path to a successful City Centre.
View Robert Gibbs' Auckland Conversation presentation here
References
· 1) Department for Business, Innovation and Skills, Understanding High Street Performance, December 2011, Page 30, http://www.bis.gov.uk/assets/biscore/business-sectors/docs/u/11-1402-understanding-high-street-performance.pdf
Other Useful Research
