The week in review:

30th March – 3rd April 2015

Locality key to capitalising in Russia and Eastern

Europe

Rachel Gee 09:34AM - Mon 30th March 2015

While many companies have struggled in parts

of Eastern Europe and Russia, following

political instability, Tesco’s F&F will be

opening its first outlets in Moscow, Russia in

June. The Russian franchise operator Debruss

will also be opening a further store in August in

Moscow.

Two out of three of the new Russian ventures will be within Debenhams stores, following the F&F brand launching in the UK and Ireland in 2001.

At an Internet Conference, titled, ‘Wild Wild East- How to succeed in E-Commerce in Eastern

Europe’, Jan Vichr, Founder and Chief Executive Officer of Fashion Days Group highlighted the

importance of truly understanding a location for a company to do business there. Vichr focused on

Russia and Eastern Europe, presenting expansion as key but locality as even more important for

retailers hoping to run a successful global business.

Russia

Though it has been a difficult time for Russia over the past year, with political problems and falling

oil prices, the country is finally seeing a stronger Ruble, making it a safer investment for the likes of Tesco. Alexei Ulyukayev said last week:

“The economic situation is still complicated, but we are seeing some significant signs of stabilisation”.

Other UK stores that are hoping to see results in Russia include M&S and sports retailers Adidas and

Nike. M&S has 15 stores in the Russia and further shops across Eastern Europe, including Croatia, Estonia, Czech Republic, Bulgaria and five in Ukraine.

Though the company’s financial success is yet to be confirmed and international earnings are

expected to be down to £103m, predictions estimate that M&S’s overall profits will rise 2.4% to £532.7m.

Eastern Europe

With 320m people in Eastern Europe and 64% internet penetration, retailers that aren’t focusing on opening physical stores there could be missing out.

Vichr said that internet penetration is below 50% in Ukraine and that there are large gaps between

cities and their surroundings in Eastern European countries. The key for retailers is to localize their

research to recognise how to access different markets.

In Romania, Vichr has found that favourite brands are generally Italian, while Czech fashion is more

relaxed and prefers brands such as Ralph Lauren and Tommy Hilfiger. In comparison, Poland requires

price sensitivity.

Philip Rooke, CEO of Spreadshirt, also said that retailers need to look local in order to run a

successful global business. He noted how the US and the UK’s bounce rates were 10% higher than

Europe as customers looked to find the best deals. Rooke stresses the importance of knowing your new area and cited that “you have to get natives”.

Vichr advises that retailers pay attention to operational excellence, focusing on processes. He also

believes that flexibility and adaptability is key in order to keep up with what is happening in specific

areas. Romania’s VAT in 2010 was presented as an example of how retailers were expected to adapt

quickly, as VAT increased from 19% to 24% in the country. In order to survive, global retailers had to

adjust and take this into consideration with pricing.

Tesco will need to “test, analyse, learn, adjust, test again” – “there is no time to rest” if the company follows Jan Vichr’s train of thought.

Clarks uses WhatsApp to narrate the story of the

Clarks Desert Boot

Veebs Sabharwal 09:58AM - Mon 30th March 2015

Shoe retailer Clarks Originals is using the WhatsApp

platform for a digital project that will bring the story of the Clarks Desert Boot to life for today’s fans.

‘From Rats to Rudeboys’ will provide a window into

the experiences of three key personalities from

subculture movements which adopted Desert Boots

as unofficial mascots. Through a series of WhatsApp

messages to the Desert Boot lovers of today, these

people will send images, playlists, videos and

messages which take users back to the cultural moments when Desert Boots were on their feet and rebellion was in the air.

Launching today, users will begin their From Rats to Rudeboys journey by being prompted to add a

new contact number to their WhatsApp via teaser films on social media. The campaign will be

introduced through the story of Nathan Clark:

Nathan Clark, The Original Desert Boot pioneer

On duty with the British army in Burma, Nathan Clark is a million miles from the tiny village of

Street where his family’s shoe business is based. But when he comes across a deceptively simple

suede and crepe boot which his fellow officers discovered in the bazaars of Cairo, he’s convinced it

has the potential to be an icon. Back in England, his family is not so sure. Nathan’s is a tale of

innovation and persistence. After being introduced to Clark’s story, users will meet Steve, Bruno and

Stitch:

Steve Barrow, The Mods

In an era when modernist culture was flourishing in the UK, Steve would find himself at the heart of

it. He was The Mod. He would go on to inspire the youth of his generation to embrace new music, and through his finely tailored tweed suits and the Clarks Desert Boots on his feet, to embrace fashion.

Bruno Barbey, The Enraged

In May 1968 Bruno Barbey, Paris resident and Magnum photographer found himself at the centre of a

national uprising. Over the course of those few days he would go on to capture a series of photographs

that would define a nation’s restlessness and encapsulate the spirit of rebellious youth, where protesting students wore Clarks Desert Boots on their feet.

Stitch, The Rudeboys

Stitch, reggae icon and head of a group of “rudeboys” called the Spanglers who were at the heart of

reggae’s birth in 70s Kingston. At a time when status was king, every rudeboy in town had to own a

pair of Clarks, interesting given that foreign imports were banned? The man left for England with a

suitcase full of records, and returned with a suitcase full of Clark.

Apple watch hits fashion capitals

Rachel Gee 10:33AM - Mon 30th

March 2015

Apple is turning online for the

release of its new ‘apple watch’. The

latest in its technology will be

launched on 10 April for online pre-

sales, before its first deliveries come

24 April. The new watches will be

available in stores but will require

customers to purchase online.

It won’t just be Apple stores that are

benefiting from the latest innovation,

glamourous locations will include Selfridges London, Les Galeries Lafayette in Paris and Isetan

Shinjuku in Tokyo - all high end department stores.

Opening these mini stores will allow Apple to target wealthy customers that wouldn’t necessarily

shop in Apple stores or online for the product. It will also push the pricier ‘Apple Edition’ to clients.

Apple employees have been told to push online sales rather than allowing customers to order online:

“Help them place an order online or through the Apple Store app”, the company’s training document

stated.

Try on appointments will not prioritise or reserve purchases for customers, but they will be given

hands on assistance to order items.

For consumers looking to purchase the en vogue 18-karat Apple Watch Edition model, with a $10,000

price tag, Apple has rolled out the red carpet. Customers who are buying the Apple Watch Edition

will get to skip queues, while being provided with top service from ex Yves Saint Laurent and

Burberry sales experts.

Customers shopping at Selfridges will find their new Apple purchase among luxurious watch brands,

Gucci and Cartier, Saint Laurent and Celine, following a 12 page feature in Vogue and a further

article in Elle Australia.

Whether they buy the regular stainless steel watch or the luxurious Apple Edition, consumers will be

provided with a virtual personal setup for the watch that the company describes as:

“Technology becoming seductive, with desirability not necessarily defined simply by a price tag or

elitism, but rather meticulous focus on usefulness and utility rooted in beauty.”

Apple is clearly expecting big things from the new addition to its product family, which comes as no

surprise following its net profits reported in January 2015. In its first fiscal quarter, the company

reported the biggest quarterly profit ever made by a public company so the tech giant certainly has

room to experiment with its latest products.

Kingfisher drops planned purchase of Mr Bricolage

Veebs Sabharwal 10:44AM - Mon 30th March 2015

Kingfisher, Europe’s largest home improvement

retailer, has said today that its proposed £201m

purchase of smaller French rival Mr Bricolage has

collapsed.

Doubts related to the deal emerged last week after the

majority of the Mr Bricolage board and its largest

franchisee group, the Association Nationale des

Promoteurs de Faites Le Vous-Mene (ANPF),

expressed reservations.

Last July, Kingfisher struck a deal with the ANPF, which holds 41.9% of Mr Bricolage, and the

founding Tabur family, which holds 26%, to buy their holdings for 15p per share. The agreement was

binding, subject only to regulatory clearance. The agreement carried a provision that it would lapse if

anti-trust clearance was not obtained by March 31 although an extension could be agreed by all

parties.

On Friday the ANPF refused any extension.

“Consequently the transaction will not proceed. Kingfisher is considering all of its options,” it said,

options which could include legal action.

Mr Bricolage shares were suspended from trading in Paris last Monday.

Kingfisher had wanted Mr Bricolage to expand on its position in France, its most profitable market,

where it already trades as Castorama and Brico Depot.

The collapse of the deal comes four months after Veronique Laury succeeded Ian Cheshire as

Kingfisher’s chief executive. To coincide with the deal falling through, B&Q CEO Kevin O’Byrne is

stepping down from the DIY retailer as part of a restructuring by Laury that will involve B&Q

brought closer to Castorama and bring it under more direct control of Laury.

Marimekko makes its Dubai debut

Emily Thornhill 01:00PM - Mon 30th March 2015

Finnish retailer Marimekko is embarking on its international

expansion of the Middle East with its local partner, BinHendi

Enterprises, by opening its first store in the stylist Jumeirah district.

There are later plans to further extend operations to Kuwait, Qatar and Saudi Arabia. The pair hopes to open a total of eight stores across the Gulf region by the end of 2019.

BinHendi Enterprise has more than 40 years of experience in retailing international fashion and

lifestyle brands in the Middle East and India, while also owning and operating restaurants and cafés in Dubai.

“Together with them, we are setting out to seek a foothold for Marimekko in what for us is a totally

new market area. As with our other international partners, we will build a network of stores step by

step on a solid foundation. This is long-term work, and achieving the position we are aiming for will take several years,”comments President and CEO of Marimekko, Mika Ihamuotila.

The stores will be owned by BinHendi Enterprises and their location, visual aspects and concept as

well as local marketing, will comply with international retail brand’s policies. With BinHendi’s

experience in retail and restaurateurs as well as the fluid portrayal of Marimekko’s strong

idiosyncratic design through their print and colour products, as well as in the store design, the

collaboration unveils a new super retail-eatery.

The first store is located in the new Boxpark shopping mall with an in-store café attached. Another

store is to be opened in the Dubai Mall during April 2015. Chief strategy officer of Marimekko, Päivi

Lonka, said: “The UAE is an attractive market for us, famous for its excellent shopping opportunities.

The region has a great deal of local purchasing power.

Dubai is particularly interesting because it is a busy shopping destination for tourists, attracting

visitors from around the world. For these reasons, the brand’s recognition factor can be cultivated

there globally on a very broad scale.”

Marimekko is a Finnish design company, founded in 1951, renowned for its original prints and

colours. The company’s product portfolio includes high-quality clothing, bags and accessories as well

as home décor items ranging from textiles to tableware.

The bold print brand has more than 140 stores, in about 40 countries around the globe. The key markets are Northern Europe, North America and the Asia-Pacific region.

Ihamuotila added: “I am delighted that we have succeeded in building Marimekko into a brand able to

attract retail-sector players throughout the world. We have concentrated in our expansion into the

international market primarily on regions with plenty of growth potential.”

Habitat at home in Homebase

Emily Thornhill 02:47PM - Mon 30th March 2015

It’s been three years since Habitat’s remaining London-based stores were saved from administration

by the Home Retail Group. During its 50th anniversary year however, and under Home Retail’s

ownership, there are 37 Habitat-in-Homebase stores across the country, three of which opened in the last month.

At home in Homebase

After acquiring the household furnishings retailer, Home Retail Group brought Managing Director,

Clare Askem onto the board to help turnaround the brand’s image and within a short amount of time,

Habitat-in-Homebase stores began to spring up across the country.

Habitat-in-Homebases demonstrate how outlet stores featuring selected key pieces can entice

customers online. The host store Homebase, tends to attract the same DIY, home furnishing crowd as Habitat and offers a mixed blend of customers.

Askem’s long term plan is to have “north of 80” outlet stores which will provide customers with a

desirable capsule collection drawing them towards the online side of the retailer.

The brand’s choice of products was also at the top of Askem’s concerns. She hired a new creative

director to help with this and today around 85% of the products that Habitat offers are wholly

designed by the retailer.

A third of the retailer’s sales now come from the three independent London stores, a third from online

and the remaining from the Habitat-in-Homebase collaboration outlet stores.

Household sales habits

Last week the Office for National Statistics (ONS) confirmed that UK sales growth increased overall

by 5.7% compared with February 2014, providing the UK with its 23rd consecutive month of year on year growth.

On top of this news, online sales increased by 10.1%, above February 2014 and the average weekly

online spend was £756.8m in February 2015.

Household goods were also fairing well, due to the British housing market’s improvement. The sector increased by a staggering 53.5%, suggesting growing confidence in basic human needs.

This news suggests a timeliness of Habitat-in-Homebase‘s collaboration, providing consumers who

have an increasing expendable allowance with an exciting new way to improve their homes. It also allows the brand‘s creative team scope to indulge in new projects.

New concept Chichester store

Habitat, Chichester Location: Homebase Chichester Design: In-house Size: 5,500 sq ft Opened: March 2015

Habitat-in-Homebase‘s latest collaboration is in the form of a new 30,000 sq ft Homebase with a

5,600 sq ft Habitat outlet on the south coast in Chichester, making it twice the size of any of the brand‘s other outlet collaborations.

The new space will showcase a retail concept developed by Habitat Creative Director Polly Dickens, Creative Manager Graham Copeland, and in-house Designer Matthew Long.

With over 1,300 products from the Habitat collection including furniture, upholstery, homewares,

textile and lighting, the store design includes bespoke fixturing designed to enhance the sense of space

and light and uses digital technology to create an immersive store environment for customers by

incorporating interactive touch screens and video walls.

“The Mini Habitat project has allowed us to extend our physical presence across the whole of the UK

making us more accessible than ever with 38 different store locations,” comments Clare Askem, Managing Director of Habitat.

“These stores have supported strong sales growth for us and this year we’re looking to continue this

expansion meaning that customers are able to interact with Habitat products and staff more conveniently in locations stretching from Cornwall up to Scotland.

As our digital business continues to grow we are seeing that there is still a demand from consumers

for physical showrooms that allow interaction with product before purchase and allow shoppers to

immerse themselves in a Habitat environment.

Chichester is a particularly exciting project as it offers us an opportunity to trial a new visual concept

for these stores on a much larger scale and means that we can look to incorporate successful new elements from this design into our other Mini and flagship stores in the future.”

Another two Habitat shop-in-Homebase stores are to open before the end of March, in Newcastle-

under-Lyme and Harrogate.

Hopes for Habitat-in-Homebase

Now standing at 50 years old, Habitat is still evolving and operating in a new manner to its

predecessor: focusing on emitting a design-led environment for its customers. With its reinvented

interiors, remodelled products and a multi-channel approach to its customers, Habitat is definitely not

what it once was.

With the economical boost from the housing market sector combined with customers’ purses

expanding with an expendable allowance, the brand‘s new concept Chichester store acts as a perfect microcosm of flourishing growth.

Net-a-Porter to merge with Yoox

Veebs Sabharwal 07:58AM - Tue 31st March 2015

Yoox, the global internet retailing partner for renowned fashion brands, has entered into an agreement

with Richemont, controlling shareholder of the Net-a-Porter Group, on the terms of an all-share

merger. The announcement comes after circulating rumours that last week that Amazon was

considering a purchase of Net-a-Porter, which the internet retailer was quick to deny.

Following a month in activity in the high-end online market, the transaction between the two

purveyors of luxury goods would create the YOOX Net-a-Porter Group, an independent online

retailer, with combined 2014 net revenues of almost £1bn.

The new online fashion giant could be a company valued at over £1.8bn although the deal is

conditional on the agreement of Yoox shares at a June 2015 meeting. If all goes to plan, completion

will happen by September this year and the new company will be listed on the Borsa Italiana, where

Yoox currently trades as a public company. Federico Marchetti, Founder and CEO of YOOX, will be

the CEO of YOOX Net-A-Porter Group.

Today, the doors to “the world’s biggest luxury fashion store” have been opened, comments Natalie

Massenet, Founder and Executive Chairman of Net-A-Porter, who will serve as Executive Chairman

of YOOX Net-A-Porter Group.

“It is a store that never closes,” she continues, “a store without geographical borders, a store that

connects with, inspires, serves and offers millions of style-conscious global consumers access to the

finest designer labels in fashion. A store that provides established and emerging brands with the

greatest interactive shop window to the world. Together, with our world-class teams in technology,

logistics, content and commerce we are redefining the fashion media and retail landscape. The best

way to predict the future of fashion is to create it.”

At a time when there is increasing online competition between purveyors of high-end goods, the deal

will combine two complementary businesses covering all key geographic luxury markets and

customer segments. The proposed merger will be accessed by over 2m high-spending customers and

over 24m unique visitors worldwide. Upon completion, the YOOX Net-A-Porter Group intends to

launch a capital increase of up to £145m to fund future growth opportunities and the integration,

potentially allow for the entry of strategic investors.

“Established business models are being increasingly disrupted by the technological giants,” adds

Richemont Chairman Johann Rupert. “It is with this in mind that we believe it is important to increase

leadership and size to protect the uniqueness of the luxury industry. The merger of the two leaders

will further enhance an independent, neutral platform for a sophisticated clientele looking for luxury

brands.”

Launched in 2000, Yoox is a multi-brand online fashion store with operations in China, Europe, the

U.S. China and Hong Kong.

Net-a-Porter was founded the same year, with Richemont acquiring a majority stake in for around

£225m. Shares in the conglomerate slipped after it released a statement confirming the talks, while

Yoox’s rose.

Kingfisher will close 60 B&Q stores

Veebs Sabharwal 08:20AM - Tue 31st March 2015

In a trading update this morning, B&Q’s parent company Kingfisher, said it plans to close around 60 under performing B&Q stores in Britain amid as an annual profit slump of 7.5%.

The store closures form part of new Chief Exec Veronique Laury’s plan to shake-up the group, who

said:

“It is clear to me that we need to organise ourselves very differently to unlock our potential. This will

involve taking what is essentially a locally managed set of businesses and creating instead a single,

unified company where customer needs come first. The first step in developing this new organisation

is the creation of a new, international leadership team with more focused cross-company roles.”

B&Q currently trades from 360 stores and the planned closures will represent about 15% of the chain’s space.

Today announcing a set of “first ‘sharp’ decisions which are already underway”, Kingfisher, the

world’s no.3 DIY player, cited the development of unified garden and bathroom businesses and the

start of a Big Box revitalisation programme across Europe.

The London headquartered company will also continue to develop detailed plans for the wider reorganisation of the company as it progresses on the journey towards becoming “‘ONE’ Kingfisher.”

Kingfisher made a pretax profit of £675m in the year to 31 January, which was in line with analysts’

average forecast but down from the £744m a year earlier. The drop reflects stagnant sales in France

since the summer of 2014, adverse foreign exchange movements on the translation of non-sterling profits and £22m in charges for new country development activity.

Kingfisher, Europe’s largest home improvement retailer, has been in the spotlight of late, announcing

the departure of B&Q’s CEO Kevin O’Byrne (who will exit the business on 15 May) and yesterday

the collapse of the proposed purchase of small French rival Mr Bricolage.

Retail footfall to spike over Easter

Veebs Sabharwal 08:32AM - Tue 31st March 2015

As the most anticipated weekend for retail after Christmas – Easter Weekend – arrives, retail

intelligence specialist Springboard today forecast footfall across UK high streets, shopping centres

and retail parks is set to increase by 4.7% year on year over the long weekend (3 April, 4 April and 6

April).

Easter is two weeks earlier than in 2014 and dissimilarly from last year, falls immediately following a

national pay day putting consumers in a strong position of disposable income and tempted to spend over the weekend.

Consumer confidence has grown overall due to lower inflation and with a decline in fuel prices and

evidence of pay rises across the country, though still modest, the difference could leave households up to £20 to £30 per month better off.

High streets across the UK are predicted to fare the best over the Easter Weekend, with Springboard

forecasting a +6% YOY rise in footfall over the three key shopping days as the fine, yet cool, weather

continues. Shopping centres will follow, with footfall expected to increase +4.6% YOY as shoppers start to shop for their spring wardrobes and retail parks will also see minor growth of +1.6% YOY.

Diane Wehrle, Insights Director at Springboard commented; “Last year we saw a significant decline

in retail footfall over Easter Weekend (down 6.4% YOY), and though this year we are expecting to

see figures regain strength, they will still be overall below the 6.9% YOY growth seen in 2013. The

earlier dates for the long weekend traditionally link to positive effects for retailers and with consumer

confidence high, we expect shoppers to respond with their feet buoyed by the benefit of a recent pay day.”

Good Friday is set to be the strongest day for footfall with 5.7% YOY growth forecast across retail

destinations as shoppers take advantage of the extra day off at the end of the week. It is predicted that

Saturday will see further growth of 3.9% YOY and Easter Monday will see the typical bank holiday surge with footfall expected to grow 4.6% YOY.

London goes mad for Parisian fashion

Rachel Gee 08:57AM - Tue 31st March 2015

London, the multicultural capital of the UK, appears to be replicating a Parisian ‘boutique’ high street to capitalise on consumer love for everything French.

With a turbulent economy, Paris is a difficult market to conquer, as it is only just emerging from three

years of stagnation. Though there is something to be said for the fashion capital, with tech giant Apple

having selected lux department store Les Galeries Lafayette as one of its key destinations to debut the new Apple Watch.

“Paris is the fairytale and the top of the fashion food chain where everyone dreams of making it”

Australian designer Michael Lo Sordo comments, “but it’s completely tough because the market there is so saturated and competitive and to grab the attention of media and buyers is incredibly difficult.”

Paris has kept its status as the hub of all that is stylish and in doing so has created a legacy that can be

replicated in other countries, even amid difficult economic conditions.

Though 2014 was an unfortunate year for France’s economy, the country is expecting a positive

recovery this year, as predictions suggest that France will beat its 1% growth expected in 2015. Prime Minister Manuel Valls announced, “2015 will be the year of the return to growth and confidence”.

While France is waiting, French brands are making the most of the British capital, which saw 16m

visitors in 2014 compared to Paris’ 14m. Prime locations include Covent Garden, Westbourne Grove and Mayfair.

COVENT GARDEN

Pierre Hermé

Seven Dials in Covent Garden is home to over 150 shops including international flagships and

concept stores. On the opening of Parisian chocolatier Pierre Hermé, Sam Bain-Mollison, Head of

Group Retail Strategy and Letting at Shaftesbury PLC, said:

“Seven Dials is London’s focal point for select international brands seeking to create something special in the capital”

The 596 sq ft store opened last year offering macarons and chocolates as well as becoming a dining hotspot for those seeking a French experience.

Loft Design By

‘Loft Design By’ is another French fashion retailer that has benefited from consumers’ demand for the French look. Currently holding 10 stores in Paris, the brand has now opened three more in London.

Chanel

Then there’s the ultimate French brand, Chanel. The luxury powerhouse was valued at $7bn in

November 2014, maintaining its headquarters in Paris. Not usually one to reveal its financial results,

the company gave competitors an insight into its affairs in 2012, reporting that sales had provided it

with 25% profitability.

The global fashion label has also announced that it will now sell all bags at the same price globally to

minimise pricing gaps and the production of counterfeit goods. This means that prices will rise by 20% in Europe and fall by 30% in Asia from next week.

Other companies that have boosted France’s influence in Covent Garden include footwear brand

Bobbies and French fashion retailer Sandro.

WESTBOURNE GROVE

Le Creuset

Le Creuset in Ledbury Grove provides ‘iconic French cookware’ to the stylish Westbourne Grove.

The cookware retailer has shown growth from its prediction of 5% household penetration in 1992,

now available in department stores such as John Lewis. The brand is continuing to adapt in the UK

having recently released its Spring/Summer ‘Bloom’ collection.

aimē

Boutique aimē is a fashion and home wares boutique that supplies established labels such as APC and

Isabel Marant. Isabel Marant has grown over recent years, recently collaborating with ImagineX, a

management and distribution arm, to grow in Greater China. The company generated €150m in

revenue in 2013 and growth rates have been between 20% and 30% over the last 20 years.

Mayfair

Olivier Rousteing was appointed Creative Director of Balmain in 2011 and since then the company

has moved from strength to strength having recently opened a flagship store on South Audley Street Mayfair.

Though Gilles Moec, Economist at Bank of America Merrill Lynch, believes that the ‘ingredients’ are

there for the recovery of France’s economy and that “The French government is saved by the bell”,

French retailers are continuing to maximise their profits abroad. There is a growing market for all things Parisian in London.

Africa’s growth cities attract increased foreign real

estate investment

Veebs Sabharwal 09:01AM - Tue 31st

March 2015

Increased numbers of international

investors are investigating opportunities

in African real estate markets, attracted

by the continent’s startling economic and demographic growth prospects.

According to independent global property

consultancy Knight Frank, which this

week published its Africa Report 2015,

the population of Africa will quadruple to

over 4bn by 2100, with nearly 1bn of

these people in Nigeria alone. This is

arguably the single most important demographic trend that will shape the world over the course of this century.

Highlights from the report include the salient prediction that by 2100, nearly 40% of the world’s

population will live in Africa, with the large majority of these being in the continent’s fast-growing

cities. Today, Nigeria is the largest economy in Africa with GDP estimated at $433.05bn, followed by

South Africa (£248.7bn) and Sub-Saharan Africa is one of the world’s most rapidly developing

economic regions. It’s projected that 13 of 20 fastest-growing global economies over the next five years will be in Africa

Growth story

The largest cities of Sub-Saharan Africa are growing at a rapid pace; Luanda’s population is forecast

to increase by more than 70% during the 2010-2025 period, while Dar es Salaam, Kampala and

Lusaka are expected to double. Allied to strong economic growth, this is creating increased demand for good quality real estate of all types.

The retail sector has seen a huge increase in activity as a result of the rise of the urban middle class

and the expansion of South African retailers such as Shoprite and Pick n Pay into the rest of Africa.

Modern shopping malls are a relatively new concept in much of Africa, but a spate of new malls has been developed in key cities such as Accra and Nairobi.

Matthew Colbourne, Associate of International Research said “The growth of Africa’s cities and

economies will do much to define the global socio-economic landscape over the coming decades.

These major long-term trends are driving the construction of high quality real estate across the

continent. The most visible demonstration of this is the rise of the modern shopping centre concept in

cities such as Nairobi, Lagos and Accra, but there are development opportunities in all property sectors.

Large volumes of good quality commercial and residential property are needed to support the

continuing African growth story, presenting excellent opportunities for global funds looking to diversify or enter into African markets.”

Are we making time or killing time?

Emily Thornhill 10:01AM - Tue 31st March 2015

Billions of us around the world have become

accustomed to a yearly ritual of winding our

clocks forward in the spring, and back again in the

autumn. In the early hours of Sunday this week,

the bi-annual meddling of time started up again, bringing with it an age old argument.

Modern timekeeping

In the UK, Greenwich Mean Time (GMT) is

observed during the winter months and an hour is

loaned during British Summer Time (BST).

British Summer Time - also called Daylight Savings Time (DST) – takes an hour of our sleep and

gives it back some months later that year. In reality no time is gained or lost, rather, better use of the

extra daylight that is temporarily available to us by is made (by shifting an hour of sunlight during

summer months, normally between March – October).

DST was first suggested as a means to making the most of daily sunlight. In 1784, US inventor and

politician Benjamin Franklin wrote a satirical letter to the Journal of Paris calling for the clocks to go

forward during summer months. He said this would allow Parisians to take advantage of the natural morning light for longer, thereby economising on candle use.

Morning vs. Evening

This thrifty use of natural morning light, by loaning an hour and making mornings darker (when most

consumers sleep through and miss valuable light) is instead economised by making evenings lighter

and longer, when the majority of people are up and about.

To this day, individuals, businesses and governments are still debating the scheme‘s worth and

whether they should adopt DST throughout the entire year. This would end gloomy winter evenings, making it feel a bit more like summer all year round.

Does our meddling make or kill time?

In business terms, the adoption of Daylight Savings Time (DST) on a permanent basis is straight

forward as we’d essentially be aligning UK watches with clocks across the continent.

This would bring the UK in line with Central European Time, meaning London would work the same

business hours as Brussels, Paris, Frankfurt and Milan.

For retailers that operate across the globe, this could cut down staff overtime costs to communicate internationally, as well as removing scheduling confusions, from conference calls to deliveries.

This time loan would also give the UK an extra hour of overlap with Beijing, Tokyo and other major import and export markets in the growing economies of Asia.

A report from 2010 claimed that people would gain an extra 235 hours of post-work daylight each

year. For retailers this extra hour of sunshine per evening means longer time spent shopping and a potential 235 more hours spent shopping while on DST than -235 hours while on GMT.

Glamour and Feelunique to create Glamour Beauty

Boutique

Emily Thornhill 10:38AM - Tue 31st March 2015

Glossy magazines are flocking to the next “it” destination of

beauty e-commerce, extending their brand and launching into

the beauty sector to strengthen bonds with their readers and increase revenue streams.

First it was Time Inc.’s Marie Claire partnering up with Ocado,

now Condé Nast’s Glamour and online pureplay Feelunique

have formed an alliance which will create a unique branded

beauty destination, capitalising on the authority of the Glamour beauty editorial and the reach of Glamour’s website.

Glamour is Europe’s number one bestselling women’s glossy magazine in its sector. “Devoting more

pages to beauty than any other magazine,” Glamour’s Editor, Jo Elvin comments, sees this merge

between the glossy magazine world and the beauty e-commerce space as a logical and win-win situation as her magazine’s readers “are as passionate about it as we are”.

Publishing Director, Jamie Jouning confirmed this decision saying “The partnership not only provides

our audience with a relevant and extremely useful shopping service but also establishes an exciting

new revenue stream for the Glamour brand.”

Elvin added “The democratic nature of beauty products reflects our winning formula of feel-good

attainability with luxury values. The Glamour Beauty Boutique will allow us to grow the relationship

with our reader even further.”

Feelunique was founded in 2005 and is Europe’s largest online winning premium beauty retailer. An

official retailer carrying over 500 of the world’s leading beauty brands from cult classics to cutting edge exclusives.

Jim Buckle, COO of Feelunique said: “We are delighted to be collaborating with Glamour to create

the glamour Beauty Boutique. Glamour is respected and trusted amongst women and beauty brands, making this move into retail a natural evolution.

Feelunique will bring its expertise in beauty ecommerce to this exciting partnership, ensuring that

glamour’s readers will have the very best beauty shopping experience available, accessing the UK’s

widest selection of products, to discover the ones that suit them best, in their own unique way.”

Ex-Marc Jacobs creatives launch their own brand

Emily Thornhill 02:46PM - Tue 31st March 2015

Last week saw the end of Marc Jacob’s diffusion line, Marc by

Marc Jacobs, as it was announced that the less expensive range

would be assimilated into one super Marc Jacobs brand. Now,

the creative duo behind the diffusion line, Katie Hillier and

Luella Bartley, have announced their plans to unite and launch a luxury label of their own.

The news comes at a time when Bartley’s role as Design

Director of the women’s ready-to-wear line was being

questioned: would she stay or would she go?

Bartley previously ran her own eponymous label, Luella, for 10

years until it ceased trading in 2009. Now she’s set to move on

from her role with Marc by Marc Jacobs, commenting that

they’d put all of their “experience into making something that’s a reflection of us, of what we want to wear.”

Hillier meanwhile, will continue working as a consultant for

key British fashion brands, alongside running her eponymous accessories line, as well as Hillier Bartley.

After quietly presenting their new collection to buyers at Paris Fashion Week in early March, the

pair’s debut AW15 collection, under the name Hillier Bartley, will hit selected stores worldwide in

August 2015.

It will feature women’s ready-to-wear, bags and accessories, all following a quintessentially British

theme. The RTW collection will be made in the UK, with fabrics sourced from British mills while the bags and accessories will be created in Venice.

The designer friends told WWD that the brand can be described as “masculine elegance” -

synonymous with Saville Row tailoring: “cloths, velvet, silk, merino wool and shearling,” across tailoring, dresses and separates.

Bartley said to WWD of the brand: “It is a culmination of everything I have learned as a designer and

a woman, and is purely and defiantly about the clothes and fabrics. We have also looked at the women

we admire, what we would want to wear and the inspirations that have been close to us for ages. Its

ultimate heroine lies somewhere between Ian McCulloch and Katharine Hepburn. It’s about a woman

our age, indie by heart, rakish and irreverent by nature, who is maturing into refinement and naturalness.”

Having met on the 90s fashion scene, former fashion journalist and designer Bartley described the

new venture as “a very personal project which Katie and I have been working on for years,”

confirming that the long-time friends’ decision was made long before they learned of Marc by Marc Jacobs’ fate.

Meanwhile, Hillier described the collaboration as a “reflection of us, of what we want to wear.” She

continued: “Luella and I have always worked together in different ways. I’m really proud of what

we’ve made - the craftsmanship, attention to detail and design. It’s been a real labour of love and I am really looking forward to seeing women we admire carrying our bags and wearing our clothes.”

A spring clean for Heineken

Rachel Gee 02:56PM - Tue 31st March 2015

Heineken beer has opted for some spring cleaning,

as the company’s managerial structure will be

overhauled with effect from 1 July 2015.

The business is set to be regrouped around four

geographic regions, while existing regions of

Western Europe and Central and Eastern Europe

will be united to form a single Europe division.

This will be run by President Americas, Stefan

Orlowski.

Roland Pirmez, President Asia Pacific will be

leading the new Africa Middle East and Eastern European region.

Heineken will develop its managerial structure, as Chairman of the Executive Board and CEO of

Heineken, Jean-François van Boxmeer confirmed:

“Our management structure will be flatter, our operating companies more empowered and our cost of

doing business lower. The new Executive Team consists of proven leaders who will build on the outstanding work done by the Heineken Executive Committee over the last few years.”

Managerial changes

Heineken verified that its roles of Chief Marketing Officer and Chief Sales Officer would be

combined at a global level in one Chief Commercial Officer role, with Jan Derck van Karnebeek set

to take on the responsibility. The specific role of ‘Chief Strategy officer will be ‘phased out’. As a result the new management team hopes to be ‘leaner’.

Chris Barrow is the current Chief Strategy Officer and will leave the company July 2015. Boxmeer

commented:

“In the last 10 years, Chris has made an important contribution to our company via his business development and management roles in our emerging markets”.

The current Regional President of Western Europe and Global Chief Marketing Officer, Alexis

Nasard will also leave the company to focus on ambitions outside of Heineken. He will exit June 30

after joining the company in 2013. Under his influence the company ‘step-changed the marketing agenda’ and was awarded the Cannes Lions ‘Marketer of the Year 2015’ award.

The third change comes with Siep Hiemstra, the current President Africa Middle East, who is set to

retire August 2015 after 37 years of service. He will continue to be affiliated with the company, with a

role as a Board Member of Nigerian Breweries and United Breweries in India.

Future development

The changes hope to allow the business to focus more on growth opportunities and allow the company to conduct itself in a more ‘cost effective’ manner.

Heineken Ireland looks to be one of the first locations to benefit from the changes. This area is

looking to invest €20m in its new cider brand over the next five years, which is set to launch 1 May

2015.The new brand has apparently been under development for over three years, with Fiona Curtin, Senior Innovation Manager at Heineken Ireland declaring:

“We have undertaken major research into the category, from a branding and taste perspective, and we

know that Irish cider drinkers are looking for as alternative”. The new product will include a nationwide media campaign, while the invention in hand won’t be revealed until May.

The company’s 2014 financial results in February demonstrated Heineken’s strength on a turbulent

market, leaving the retailer with a profit of €1.516m. With that said, the company is not becoming

complacent. Sharon Walsh, Marketing Director Heineken Ireland stressed that innovation is key for the company to develop in 2015:

“Innovation is at the heart of Heineken Ireland’s DNA and our ambitious, carefully considered entry

to the cider market demonstrates our commitment to delivering another exciting, premium drinks

brand to the Irish marketplace.

2015 comes with some big changes for the Dutch brewing company and the potential for notable growth.

Hamleys opens Europe’s largest toy shop in Moscow

Veebs Sabharwal 04:08PM - Tue 31st March 2015

Today Hamleys opens Europe’s largest toy shop in

Moscow.

Hamleys is the world’s oldest toy shop and it

continues to innovate. Designed by global retail and

brand consultancy FITCH, the new 7,000 sq m space

expands Hamleys’ current design and incorporates

new concepts that transport families through a world

of entertainment and discovery. Hamleys World at Lubyanka is more than a place to simply shop.

A new platform called ‘Worlds of Play’ takes customers on a journey over two storeys and through

nine different worlds: Enchanted Forest, Imagination, LEGO World, Magic Kingdom, Metropolis,

Motor City, Park, Safari and Space.

Each world mixes retail, attraction and entertainment to provide a feast for the senses; in Motor City

there is a Go-Kart track; in Space a full scale replica of the Star Wars Millennium Falcon (that

children can test drive); in Magic Kingdom a huge castle in which kids can play and explore, and

witches fly through Enchanted Forest on broomsticks, ducking between tree houses and scaling

hidden pathways. Digital windows display cues from nostalgic Russian childhood games whilst

interactive signage and wayfinding make navigation a “delight”.

Located in the famous Lubyanka Square and known as “Mir Hamleys” in Russia, the store is set to

become a leading Moscow attraction. This toy shop is a place for exploration and immersion,

championed by a 13 m tall LEGO rocket made with 1.9m bricks.

Gudjon Reynisson, CEO of Hamleys, said: “Hamleys is about making toys fun for families all over

the world. At Hamleys Lubyanka, through our partners, we had a fantastic opportunity to develop our

retail experience to be even more memorable.”

“Play is a serious business,” says David Blair, CEO FITCH EMEIA. “The more a person can interact

with a product, the more immersed they become in the brand, the deeper the connections they build. The Hamleys World concept continues to build on a place where toys come alive.”

Asos profits slip as it invests in global distribution

Veebs Sabharwal 10:09AM - Wed 1st April 2015

Online fashion giant Asos today reports a rise in

half-year revenues, although investments in its

infrastructure and price-cuts hit net income as it

posted a 10% decline in first-half profit to £18m

Trading for the six months ended 28 February

2015 included a “record” Christmas season, with

total sales increasing by 14% to £536m (in 2014 it

was £472.3m). UK growth remained strong with

sales up 27% and International sales up 5%.

The retailer for 20 somethings saw encouraging

momentum in international markets following

planned price investments and the launch of a

zonal pricing solution. The impact of this international price investment on gross margins, plus

increased warehousing costs as Asos builds a global warehousing capability, resulted in a decline of

10% in profit before tax to £18.0m but the fashion destination remains optimistic in its outlook for the

remainder of the year.

“With our continued investment in our international price competitiveness gaining traction,

momentum in the business is building. This gives us confidence in the outlook for the second half and

that full year profit and margin will be in line with expectations,” commented Nick Robertson, CEO.

After last year’s string of three profit warnings, a turnaround is well underway.

Asos pledged commitment to investing a total of £75m in its technology by the end of the next

financial year, and it’s made significant progress during the last six months having rolled out zonal

pricing functionality in Australia, France, Germany, Spain, Italy and the US during the period,

enabling it to offer more competitive local pricing and to sell brands which were previously restricted

in these territories.

It also launched localised versions of its Android and iOS apps in France, Germany and the US during

the period, and in Italy, Spain and Russia during March 2015. Traffic from mobile devices now

represents over 50% of all traffic and in response to this the e-tailer launched its first mobile-only

promotions during the period. Asos will further expand its international mobile offering during the

next six months with the launch of a localised app in China.

The principal international objective for Asos this period has been to restore price competitiveness,

following a period of adverse exchange rate movements.

During the first six months of the year the pureplay reduced local currency prices for its Australian,

New Zealand and Eurozone customers, and initial customer response is “encouraging”, with increased

sales growth in these territories. It will continue to focus on its product and pricing offer in existing

strategic markets before expanding into new markets, but expects to launch new European websites

within the next year.

After investing £3.1m in China operations during the period, the Group is “pleased” with progress in

this territory.

In a statement released this morning, the British online pureplay also welcomed its new People

Director Peter Collyer, who joined in March and recently ran Global HR for Claire’s Stores, prior to

that, he spent over ten years with The Walt Disney Company in a number of people roles and for four

years with fashion retailer Oasis Stores.

In addition, Asos will soon be joined Clifford Cohen, who has been appointed as Group Chief

Information Officer and will start in his role next month May. Cohen spent seven years with Marks

and Spencer in a variety of IT related roles including retail, multi-channel and ultimately as Interim

Group Chief Information Officer. Prior to Marks and Spencer, he spent eight years with Accenture

where he led IT teams on supply chain for Dixons Stores, re-platforming for Sainsbury’s and

Merchandising and Supply Chain for New Look.

The retailer’s search for a new Group Chief Financial Officer is now at an “advanced stage” and

expects to update the market in due course.

Chanel launches ‘e-service’

plan

Rachel Gee 09:45AM - Wed 1st April 2015

After recently confirming that it will align its prices, fashion power house Chanel is now preparing for

another ‘universal’ move that will allow the luxury retailer to sell its goods online.

The news that Chanel will soon be launching e-commerce has been contemplated for some time,

though

Chanel’s President of Fashion, Bruno Palovsky rejected the idea back in 2012 when he said:

“What we want today - and the way we use digital - is to have more and more people come to the

boutique to see the product, to touch the product, but also to try the product.”

He urged customers to come to the store to try items on commenting, “Our clothes are quite

sophisticated and one of our strengths is alterations”.

However, it seems that even the most prestigious of brands can’t escape the internet in 2015.

Pavlovsky told WWD that the venture isn’t much of a shift from the digital platform Chanel has

already been running:

“It’s an evolution to better serve our customers. Some of the customers are able to come into the

boutique”.

Palovsky associates the plans with customers now requiring ‘speedy shopping’. Consumers don’t

always have time to shop in store, “they want to go faster and they know exactly what they want - it’s

more e-service than a pure e-commerce approach”.

Chanel will be including its new pricing on its online platform, which will align its prices for the

staple bags including the 11.12, the Boy bag and the 2.55 from April 8 2015.

Making the $7bn company available to a wider market and distributing goods at standard prices, can

only be a positive step forward for a retailer that holds a notable place on ‘Forbes list of the World’s

Most Valuable Brands’.

Chanel shoppers will have to wait until 2016 before they can expect deliveries to their front door.

Mondelēz brings first ‘Made in Morocco’ Oreo

biscuits to market

Veebs Sabharwal 09:36AM - Wed 1st April

2015

Last week the new Kraft Foods Group was

devoured by 3G Capital, a Brazilian private-equity

firm, and Warren Buffett’s Berkshire Hathaway, in

a deal valued at $48bn.

As David Turner, an analyst at Mintel, put it “When

Buffett invests in a sector, it gives a sign that the

sector is ripe for acquisitions”, so Irene Rosenfeld, CEO of Mondelēz, is doing whatever she can to make sure the food and beverage giant isn’t next.

In order to cost-cut, the confectionary conglomerate needs to improve profitability and place a focus

on creating more efficient operations. Perhaps this is why Rosenfeld has insisted on a restructuring

and upgrading of Mondelēz’s production facilities and supply chain as well as altering its organisational structure to be more agile.

Yesterday the American company announced that it has begun to make and sell Oreo in Morocco,

after investing almost $11m in a state-of-the-art local production capacity to create the company’s largest Oreo production line in Africa.

The investment will make the world’s best-selling cookie widely available to Morocco’s 34m people

and expand the local biscuits’ market by generating more business for Mondelēz’s Morocco trade

partners.

Mondelēz Maroc, a subsidiary of the firm, will have the capacity to make as many as 900m Oreo

biscuits per year, or almost 2.5m Oreo cookies per day in its Casablanca facility, after completing

installation of the high-tech production line and starting up in March. If laid side by side, that’s enough dunkable biscuits in a year to stretch the full length of Morocco more than 15 times.

“We’re so excited to be making this delicious, high-quality and iconic biscuit available to all

Moroccans, made right here in the Kingdom by Mondelēz Maroc,” said Antoine Collette, President

Biscuits for Mondelēz in Eastern Europe, the Middle East and Africa.

Collette added: “No matter where it is made—whether in Europe, the United States or Morocco—

Oreo is the same delightful biscuit baked to the highest Mondelēz International standards that has brought so much joy to billions of people since coming to market more than a hundred years ago.”

Two years after completing the acquisition of Biscuiterie Industrielle du Moghreb, the $11m

investment in the Casablanca plant reinforces Mondelēz’s presence and interest in Morocco. Mondelēz is the world’s largest maker of biscuits, and the number one maker in Morocco.

With the investment, MondelēzMaroc will make the crème-filled confection more available to

Moroccans, offering it in a range of attractive formats and at pricing that Moroccans can afford.

Capitalising on its large and well-developed distribution network, Mondelēz Maroc intends to make the chocolate sandwich cookie widely accessible in traditional, and modern, trade stores.

Tidal fail?

Rachel Gee 08:45AM - Wed 1st April 2015

The music industry is worth more than $130bn globally.

One player that is delving into all aspects of the sector is Jay Z. Half of a major power couple and

with a vast amount of contacts, the music mogul has used the notion of ‘star names’ to his full

advantage. Jay Z has parted with $56m of his $520m empire’s worth, to purchase Tidal, a music

platform that aims to differentiate from other music streaming companies such as Xbox music, Google Play and most notably music giant Spotify.

Due to sheer popularity, music streaming services have recently been added to ONS’s price of a basket of goods to determine UK inflation rises.

Retailers can benefit from successful music streaming sites which provide them with an advertising

platform. However, Tidal seeks to prevent this by ‘avoiding greed’, with artist Alicia Keys

commenting, “We believe it’s in everyone’s interest - to preserve music.”

Tidal

Tidal was originally launched October 2014 by Norwegian firm Aspiro. The company offers

exclusive music from major artists with demo tracks and 16-bit FLAC format songs available.

Tidal says that its audio is ‘CD quality’ and that it will stream this same experience online, as well as to the business’ app.

Jay Z’s aim is to change the way music is streamed and to compete with dynamo Spotify, declaring

that he, “didn’t like the direction music was going”. Instead, artists will receive more money through

Tidal, with rumours that they will be paid double the royalties other music streaming services can offer – a controversial fact that has caused debate among many thrifty music service users.

Tidal will charge £19.99 per month for its service, with a cheaper cost of £9.99 to compete with Spotify’s premium price.

Co owners of the company include musicians Chris Martin and Calvin Harris, who both seek to push

the business’ influence wider than its current use in 31 countries.

Tidal holds 25m high quality tracks and 75,000 music videos are available to its current 540,000 users.

Spotify

According to a report issued by market research firm Mintel, Spotify is the current music streaming

favourite, accounting for 87% of music streaming subscriptions in 2013, making it an attractive

advertising destination for retailers.

The brand possesses a massive 45m free users and 15m paying subscribers, which has led retailer

Sony to collaborate with the company to release its new Playstation Music streaming service. The

venture has been launched in 41 countries and replaces Music Unlimited, Sony’s past streaming

service. Once again, Spotify’s option is free, with advertisements available as a platform for retailers looking to profit from Sony and Spotify’s vast audiences.

The Spotify and Sony partnership is exclusive and will be a difficult alliance for Tidal to battle.

Will it work?

One major drawback for Tidal is the fact that British consumers appear less than willing to pay for

music, even though it is included in inflation calculations. Mintel reported that only 24% of customers

were willing to pay for Spotify’s service, meaning that the majority of its users experience advertisements.

Many are left unconvinced with the way Tidal will increase profits for artists but charge consumers

more money. Several astute music listeners took to Twitter, with one individual posting the wealth of

numerous artists involved (Madonna worth $800m and Jay Z - $520m).

While Spotify offers free options and a maximum cost of £9.99 per month, Tidal charges up to £19.99

each month. It all comes down to whether consumers are really concerned about the quality of music

or would prefer the cheaper option which includes adverts - statistics suggest the latter.

Having launched in 2006 and with over £46m users, retailers can relax, Tidal has some catching up to do before it triumphs over its ad friendly competitor.

Tesco trials the world’s first bouncy aisles

Veebs Sabharwal 07:46AM - Wed 1st

April 2015

Customers at Britain’s largest

supermarket will soon have their weekly

shop taken to a whole new level, as Tesco

takes a leap forward in revolutionising the

shopping experience. The Big Four grocer

has introduced trampoline inspired

bouncy aisles, helping people reach the

top shelves more easily.

Lucy Mecklenburgh, ex-star of ITV

reality show The Only Way is Essex and

current contestant on BBC’s gymnastics

show Tumble , has worked with the supermarket to help develop and quality test the bouncy aisles.

She has also been providing trampoline training to Tesco colleagues.

“The bouncy aisles are not only incredibly helpful, but also add so much fun to everyday grocery

shopping! On Tumble, the trampoline routines were always my favourite, so I love the new aisles. I

think people will jump at the chance to use them and I can’t wait for them to be installed in my local

Tesco!” Mecklenburgh explains.

Daisy O’Farllop, Director of Aisle Operations at Tesco added, “Introducing bouncy aisles is both a

practical and fun solution to help our customers reach products on the top shelves, as well as speed up

their shopping trip.

Tesco’s patented Spring Stepper Shelf Solutions will be fitted to the floor, running alongside the

shelves, leaving space in the middle of the aisle for customers to walk down with trolleys. We initially

planned to trial it in one store, but feedback has been so positive that we’re now scheduling a full roll-

out of the bouncy aisles across the UK over the next 12 months.”

Amazon’s revolutionary idea for retail stores

Emily Thornhill 01:28PM - Wed 1st April 2015

After dominating the online shopping space, is

Amazon planning on doing the same in brick-

and-mortar retail stores? A recently discovered

patent application seems to point in that

direction.

The US Patent and Trademark Office has

confirmed that Amazon has filed for “a system

for automatically transitioning items from a

materials handling facility without delaying a

user as they exit the materials handling facility.”

The e-tail giant’s patent includes the use of in-store technology, including cameras, sensors and RFID

tags that would identify shoppers and their chosen products when leaving its stores. This idea would

allow customers to delay payment for items picked up in the shop, while also avoiding lengthy waits

in kiosk queues, according to a patent Amazon has filed:

“[W]hen the customer passes through the exit (transition area) of the retail location, the items picked

by the user may be automatically transitioned from the materials handling facility to the user and the

user may be charged a fee for the items.

For example, if the user is purchasing items from a retail location, rather than the user having to stop

and ‘check out’ with a cashier, teller or automated check station, because the picked items are already

known and identified on an item identifier list associated with the user, the user may simply exit the

retail location with the items.

The exit of the user will be detected and, as the user passes through the exit (transition area), the user,

without having to stop or otherwise be delayed, will automatically be charged a fee for the items (the

items are transitioned to the user).”

Customers may pick one or more items which are then “identified and automatically associated with

the user at or near the time of the item pick. When the user enters and/or passes through a transition

area, the picked items are automatically transitioned to the user without affirmative input from or

delay to the user.”

The application also talks about how the system could establish an optional rental price or “borrow

time” with the shopper when they exit a rental store or library with an item.

The technology would potentially give Amazon a more cost-effective way to compete with traditional

retailers by operating a store that doesn’t require cashiers and could similarly serve as a place to pick

up online orders.

Amazon’s new plans for the brick-and-mortar sector have been a popular topic of speculation in the

retail and e-commerce worlds, and have raised certain questions:

Are Amazon endeavouring to enter and dominate the retail business?

While there is no evidence of Amazon working to deliver on creating the new concept technology

which is mentioned in the patent for their visionary brick-and-mortar stores, the protection of the

developed idea shows that it’s at least considering the move.

The current patent application is a continuation of a previously filled application on the same topic,

but this time it comes with much more in-depth detail on how the system would work, further proving

the companies interest and continuing development of a revolutionary brick-and-mortar store to rival

all others.

In October, Kindle and Fire phone developer was reportedly going to open its first retail store on 34th

Street in Manhattan by the end of 2014. While the store never opened, Amazon leased the building

and is currently using it as a mini warehouse from which couriers can whisk same-day orders to

Amazon Prime members.

Focus: Faster delivery, now!

While speculation continues as to whether its store will ever open, the stores themselves can further

help distribution times, as a large part of the patent application describes how the system will make

Amazon’s warehouses much more efficient.

Amazon has also introduced vending machines in airports that sell Amazon devices, and installed

lockers in small retail stores where buyers can collect their online orders.

In Amazon’s most time-efficient concept to improve delivery times, the retailer is testing product

delivery by unmanned drones.

Should we be worried about our privacy?

Within the patent application, much of the concept relies on shoppers being identified by the

technology through a tracking system throughout the store; this raises some concerns as to privacy.

The application describes the use of cameras to take a photo of the shopper upon entry as well as

when they remove a product from the shelves and again when they and their products leave the store.

With the reference of “facial recognition” within the patent, Amazon would surely have to compile

information and make user profiles of its shoppers by using such cameras to describe their height,

weight, Amazon usernames and passwords as well as their previous shopping account details, history

and payment information . A description from the patent application of a “user,” which could be a

warehouse worker or a shopper, provides some hints as to how the system would work:

“User information may include, but is not limited to, user-identifying information (e.g. images of the

user, height of the user, weight of the user), a user name and password, user biometrics, purchase

history, payment instrument information (e.g., credit card, debit card, check card), purchase limits,

and the like.”

Whether it’s a revolutionary concept or a project in process, Amazon continues to overshadow all

consumer areas.