Shopping centre retail: short on space but 'phenomenal' on footfall

Shopping centres are attracting a growing number of automotive brands keen to explore an alternative retail experience. While these locations provide considerably less floor space than the traditional car dealership, they offer massive exposure and an easy way connect with younger shoppers. "These shopping centres can see phenomenal footfall - up to 50 million visitors per year," observed automotive retail expert Emel Ahmet. With access to that sort of drop-in potential, interest is understandably growing. Rockar Hyundai has been leading the way in the UK. It set up its first location at the Bluewater Shopping Centre in England in November 2014 and the initial response was strong. On its busiest day it attracted more than 1,200 people through its doors. This sort of feedback prompted a second location at Westfield London, which opened in December 2015. Others have also been dabbling. In September this year, Opel launched the CAYU ('car for you') pilot in its home market of Germany. This merges online shopping with a brick and mortar retail location within a major shopping centre. The retail location is based at the Stuttgart Shopping Centre Milaneo and offers 170 square meters of space. Both Rockar Hyundai and the CAYU locations feature product specialists - Rockar calls them 'Angels', while Open prefers 'Insiders' - which advise on technical specifications and can arrange test drives. Ahmet expects many more such retail locations to follow. "This represents an easy way of buying cars. The shopping centre location allows consumer to browse in a convenient location with no sales pressure," she told Automotive World. These shopping centre locations also tend to be very interactive, harnessing digital technology to display the features of their range in a way that the limited physical space won't allow. This helps stimulate the interest of younger buyers. "This is particularly popular with Millennials, who are accustomed to purchasing interactively. It also fits in with the wider technology trends," Ahmet pointed out. Data from Rockar Hyundai bears that out. The retailer found that the average age of consumers at its Bluewater shopping centre location was just 39. The average age of a new car buyer in the UK is around 52. It also attracted a higher proportion of female shoppers. “We are encouraging a new set of people to come and look at our product. This is going for a completely different demographic to what we historically achieved with the new car buying process in a traditional dealership,” commented Tony Whitehorn, President and Chief Executive of Hyundai Motor UK. At the same time, such retail locations entail their own set of challenges. Floor space is clearly limited but retailers also have to take into consideration the practicalities of bringing in the few models they can display. Many may be limited to ground-floor units, for example. However, these shopping centres are just one of several pieces needed to complete the retail picture. "It is not that the typical car showroom is dying, but that this is another offer," explained Ahmet. This was echoed by Christian Löer, Director, Marketing, Opel Germany. "CAYU stores are an additional sales channel and complement the traditional sales model via dealerships," he told Automotive World. Moving forward, brands may find themselves facing tough competition for shopping centre space. "There are several brands out there looking for space but there is a limit on the number of showrooms that the landlord of the shopping centre will agree on," cautioned Ahmet. "Demand is high."

Shopping centre retail: short on space but ‘phenomenal’ on footfall

Setting up a retail outlet within a major shopping centre can help reach new groups of consumers - 50 million of them a year. By Megan Lampinen

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