Key Takeaways from the 2017 MIPIM Asia Summit: …€¦ · · 2017-12-06... , Parkson has...
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1 December 6, 2017 Deborah Weinswig, Managing Director, FGRT [email protected] US: 917.655.6790 HK: 852.6119.1779 CN: 86.186.1420.3016 Copyright © 2017 The Fung Group. All rights reserved. Source: MIPIM Asia The FGRT team attended the 2017 MIPIM Asia Summit in Hong Kong. Selected takeaways from the meeting include: 1) Localization is critical to capture the fast-moving nature of opportunities in Asia Pacific 2) Retailers and developers need to develop key differentiators in this new era 3) Retail technology is the way to make offline stores always online 4) The physical store will never disappear 5) Retailers need to localize their product offering to succeed in China 6) Characteristics of department stores that are most likely to survive 7) Entertainment is the ingredient to sustain traffic at shopping centers 8) Digitalization is the solution to the digital revolution Introduction The FGRT team attended the 2017 MIPIM Asia Property Leaders’ Summit in Hong Kong. Dedicated to property investment and retail real estate, the Summit gathers top-level real estate professionals from around the globe. This year, over 900 participants—half of which were CEOs and Chairmen—joined from 570 companies. Below, are selected takeaways from the conference: 1) Localization Is Critical to Capture the Fast-Moving Nature of Opportunities in Asia Pacific During the panel discussion titled “The Rising Opportunity in Asian Hospitality,” the panelists—representing the private investment and public and developer segments— discussed how best to position themselves to capitalize on opportunities as regions Key Takeaways from the 2017 MIPIM Asia Summit: Localization, Differentiation and Digitalization
Transcript of Key Takeaways from the 2017 MIPIM Asia Summit: …€¦ · · 2017-12-06... , Parkson has...
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December6,2017
DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
Source:MIPIMAsia
TheFGRTteamattendedthe2017MIPIMAsiaSummitinHongKong.Selectedtakeawaysfromthemeetinginclude:
1) Localizationiscriticaltocapturethefast-movingnatureofopportunitiesinAsiaPacific
2) Retailersanddevelopersneedtodevelopkeydifferentiatorsinthisnewera
3) Retailtechnologyisthewaytomakeofflinestoresalwaysonline
4) Thephysicalstorewillneverdisappear
5) RetailersneedtolocalizetheirproductofferingtosucceedinChina
6) Characteristicsofdepartmentstoresthataremostlikelytosurvive
7) Entertainmentistheingredienttosustaintrafficatshoppingcenters
8) Digitalizationisthesolutiontothedigitalrevolution
IntroductionTheFGRTteamattendedthe2017MIPIMAsiaPropertyLeaders’SummitinHongKong.Dedicatedtopropertyinvestmentandretailrealestate,theSummitgatherstop-levelrealestateprofessionalsfromaroundtheglobe.Thisyear,over900participants—halfofwhichwereCEOsandChairmen—joinedfrom570companies.
Below,areselectedtakeawaysfromtheconference:
1) LocalizationIsCriticaltoCapturetheFast-MovingNatureofOpportunitiesinAsiaPacific
Duringthepaneldiscussiontitled“TheRisingOpportunityinAsianHospitality,”thepanelists—representingtheprivateinvestmentandpublicanddevelopersegments—discussedhowbesttopositionthemselvestocapitalizeonopportunitiesasregions
Key Takeaways from the 2017 MIPIM Asia Summit: Localization, Differentiation and Digitalization
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DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
developnewtourismopportunities.Thediscussionbeganwiththegapsemerginginthehospitalityindustry.OnecompanythathassuccessfullymanagedtotakeadvantageofthisgapisAirbnb.AlmaRitaJimenez,UndersecretaryforTourismRegulation,Coordination&ResourceGenerationofthePhilippineDepartmentofTourism,mentionedthatthePhilippineTourismAuthorityiscurrentlylookingforAirbnbandecolodge-typedevelopersinordertomaintain“thefaceofthelocalcommunity.”
2) RetailersandDevelopersNeedtoDevelopKeyDifferentiatorsinthisNewEraFGRTSeniorAnalystKirilPopovmoderatedapaneldiscussiontitled“ExperientialRetail:TheFutureofRetail?”Thepanelists,comprisedofretailrealestatedevelopers,retailersandretailtechserviceproviders,sharedtheirviewsonhowtoenhancethecustomerexperienceinphysicalretailspacesinChinaandHongKong.HenryCheng,CEOandExecutiveDirectorofShanghai-basedChongbangGroup,introducedthecompany’s“LifeHub”project,whichencapsulatestheconceptthateachprojectshouldhavearetailcomponent.Chengbelievesshoppingmallsshouldbeextensionsofpeople’shomesandgaveLifeHub@DaninginShanghaiasanexampleofthis.AccordingtoCheng,thepastfiveyearshavebeenaneraofdifferentiation:qualityandspeed,whichhadpreviouslybeenthekeydifferentiators,nolongerwork,andsoretailrealestatedevelopersneedtocreatesomethingdifferent.
Source:UrbanLandInstitute
3) RetailTechnologyIstheWaytoMakeOfflineStoresAlwaysOnlineBrandsandretailersareconstantlywantingtoknowmoreabouttheiruserstomaximizetheirbusinessopportunitiesandtogodirecttoconsumer(D2C),accordingtoTimothyTsui,CEOandCofounderofFanswave,whichhasdevelopedabusinessintelligencetooltohelpretailersandbrandscollectdataviaWi-Fi.Byengagingconsumersthroughsocialmedia,brandscaneasilyreachandtracktheirconsumerbasetoperformtargetedmarketing.Thesecustomerdatacanalsohelpretailersunderstandthetimeofdayorweekconsumersvisitstores,wheretheygobeforeandafter,andwhatotherstorestheyvisit.Thesedatacanbeusedtocreatetailored,personalizedadvertising.
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DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
4) ThePhysicalStoreWillNeverDisappearThepanelistsunanimouslyagreedthatthephysicalstoreisheretostay,notwithstandingtheriseofe-commerce.TsuiofFanswavebelievesthatonlineandofflineareinseparable,andthatstoresremainimportantforbranding,loyalty,returnsandcustomerservice.ChengofChongbangGroupalsosharedtheopinionthatonlineandofflinegotogether.AdaWong,CEOandCIOofChampionREIT,pointedoutthatreturnswilllikelystillneedtobedoneatthephysicalstore.AndreaMeoni,HeadofExpansionGreaterChinaatCalzedoniaGroup,describedthelengthsthebrandgoestodifferentiatetheshoppingexperienceatphysicalstores,suchasbyorderingfurniturefromItaly,andreferredtothechallengeinChinaasfindingthebalancebetweenonlineandoffline.
FGRTSeniorAnalystKirilPopovmoderatedapaneldiscussion.Source:FGRT
5) RetailersNeedtoLocalizeTheirProductOfferingtoSucceedinChinaRetailersoperatinginChinaneedtogiveChineseconsumerswhattheywant.Thiswasthekeypointthatemergedfromthepaneldiscussiontitled“FastRetailingversusLuxury.”WilliamSong,VPofMetersbonweFashion&Accessories,describedhowthishomegrownChinesecasualwearbrandstrivestomaintainitsdominationinChina.Torecoverfromitspreviousoveremphasisone-commerceandnothavingproperlyshiftedchannels,Metersbonwenowfollowsastrategyoflaunchingnewproductsandstoreexperiencestomatchthebrand.Localizationiskeyinacountrywhereweathertrendsandculturaldifferencesexistacrossalltheprovinces.Tothisend,thebrandhasdividedChinainto30markets,runby30differentsubsidiariestoseparatelyanalyzethoseproductsthataresellingwellineacharea.
Similarly,clothingretailerEtamisanotherbrandthatdeftlyusesdifferentchannels,brandsandproductmixtoappealtolocalconsumers.Etam,whichinitiallybeganasalingeriebrand,utilizesdepartmentstores,physicalstoresande-commercesuchasTmall,JD.comandWanda’sFeiFantoreachChineseconsumers.Toremainfreshinthemindsofconsumers,Etamhas24seasonsandusestheeasy-to-carematerialsinitslingeriethatChineseconsumersprefer.
6) CharacteristicsofDepartmentStoresthatAreMostLikelytoSurviveSongofMetersbonwestatedthatthedepartmentstoremodel—i.e.,thestoreasafranchiseeofmanybrands—doeswellinareaswithahighlyconcentratedpopulation.In
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DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
areasinChinathatareexperiencingpopulationdiffusion,wherepeoplearemovingoutofthesuburbs,thedepartmentstoremodelisnolongeraseffectiveasitoncewas.
MichelleLee,NationalDirectorofOperationsandDevelopmentatEtam,liststhecharacteristicsofdepartmentstoresthatwillmostlylikelysurviveasthosethat:
1. Haveasufficientlylargearea.
2. HavealoyalconsumerbaseofVIPcustomers.
3. Areabletodifferentiatethemselves.Forexample,Parksonhasdevelopedanoutletshoppingmodel.
Source:FGRT
7) EntertainmentIstheIngredienttoSustainTrafficatShoppingCentersInthepaneldiscussiontitled“LeisureandEntertainment:HowtoDevelopandSustainTrafficatShoppingCenters,”thepaneliststalkedaboutthemeanstheyhaveusedtocreateanenchantingcustomerjourneyforboththeindividualandthefamily.
ReinhartViane,BusinessDevelopmentDirectorofKCCEntertainmentDesign,laidthegroundworkbydescribinghowconsumerswantexperiencesnotjustshoppingatmalls.Mallswithanentertainmentelementaverage10%–20%higherfootfall.
Emergingtrendsinshoppingmallentertainmenttouchedonbythepanelistsincluded:
1. Mallsareaddingintellectualproperty(IP),suchasPeppaPigandSnoopy,toshoppingmallentertainment,whichaddstotheirattraction.
2. Consumersprefermoreactiveandexperientialattractionssuchasflightsimulators.
3. Morevirtualreality(VR)companiesarelaunchingcontentandhardwaretofitinwithshoppingcenters.
4. Landlordsarestartingtoworkwithattractionsatamuchearlierstage,whichispositive.
5. Landlordsneedtolocalizeexperiences,astheycannotjust“copyandpaste.”
6. Consumersexpectconstantly-changingcontentandmallentertainmentneedstoadoptquickly,makingscreens,virtualcontentanddisplaysmorepreferable.
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DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
Source:MerlinEntertainment
8) DigitalizationIstheSolutiontotheDigitalRevolutionRonnieChan,ChairmanofHangLungProperties,presentedonthetopic“ExcellinginStrengtheningPartnershipswithRetailTenants,”outliningdigitalizationasthebestwaytoaddressthedigitalrevolutiontakingplaceintheretailrealestateindustry.Hebelievesthoseretailersthatwillbeleastimpactedbythedigitalrevolutionarethoseinthebestlocationsandinthehigher-endcategory.AlthoughChanexpectsshoppingcenterstobecomeadifferentexperienceinthefuture,hedoesnotbelievethatdigitalwillreplacetheshoppingcenterexperienceandinfactthinksthatthebiggerplayerswillonlygetbigger.HangLungPropertiesimplementeditsESTinitiative(Experience,Service,Technology)toacceleratedigitalization.
Source:HangLungProperties
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December6,2017
DeborahWeinswig,ManagingDirector,[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.
DeborahWeinswig,CPAManagingDirectorFGRTNewYork:917.655.6790 HongKong:852.6119.1779China:[email protected],CFAAnalyst
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