The New Upscale Retail – The wave of the future?
As North America continues to move towards large merchandisers such as Wal-Mart and Target and retail formats move towards a more modern appearance, retailers are forced to adopt these new retail trends to remain competitive. However, in some parts of Asia trends are moving in a different direction. In Japan, shopping is everywhere and leans in favour of luxury. The shopping experience takes place in malls, but these malls exhibit magnificent buildings made of glass and steel and designed by star retail architects such as Jun Aoki, a renowned Japanese “super-architect”.
The physical manifes
tation of the RVP is told through the retail format in which the retailer chooses. As Marshall Field’s Chicago store in 1902 embodied luxury, magnificence, and scale in that time with Tiffany chandeliers, live orchestras, and fresh flowers throughout, Japan seems to be rivaling this with their own malls in our time. Boasting a centerpiece with a descending spiral, reminiscent of the Guggenheim Museum, this spiral ensures that every shopper starting at the top of the mall will eventually pass through every store.
While North American retailers become more cognizant of time-constrained customers, Japanese retailers discount the time issue and instead enhance the customer experience by recognizing the power of atmosphere. Not only are their buildings glorious, but these retailers entice customers by integrating unusual store designs and providing entertainment where customers can soak up a concert on a rooftop amphitheatres in-between purchases.
Closer to home, the North American market is becoming saturated
with an influx of big-box merchandisers and discount retailers. However, Los Angeles is moving toward the other end of the spectrum and revisiting the trend of upscale retail. Downtown LA is set to begin construction on a $2-Billion Frank-Gehry-designed residential and shopping plaza. Building of this development is slated to happen next month, despite warning bells ringing “no sales” in many upscale retailers in the US. American banks are reporting that though retail same-store sales were up 2.2%, these sales were driven by discount retailers – “If you took out Wal-Mart’s numbers, it would basically be flat”. Upscale department stores, such as Macy’s and Bloomingdales saw its sales drop by 8.6% and upscale jewelry and apparel retailers were reportedly given the cold shoulder this holiday season.
The tightening economy south of the border brings us to question whether LA is making a move in the right direction in building a massive $2-billion upscale mall and residential development in their downtown core. Just because the trend is exploding in Japan does not mean that the same success will be garnered in the US. Japan has the resources and support from their retail consumers to launch their majestic upscale malls and renowned upscale retailers such as Tiffany and Co., Gucci, and Christian Dior are responding to these changes by opening their own mammoth stores that offer not only shopping, but bars, restaurants, and spas in their outlets.
It is evident that some customers are seeking the old-fashioned upscale retail experience that shoppers were accustomed to in the 1900s. In my opinion, the US does not seem to bear the market for such extravagant endeavors, considering the state of the market at this time; however, who is to say that the reemergence of these magnificent malls will not make a strong comeback. The theory that “if you build it, they will come”, may not be a far cry for the future of upscale malls in the North American marketplace. If Japan can do it full force, why not North America?
http://www.nationalpost.com/life/travel/story.html?id=360147
http://www.bizjournals.com/southflorida/stories/2002/01/21/story8.html
http://www.latimes.com/news/local/la-me-grand18mar18,1,364431.story
Note on Retail Formats (by: Krista Morrison & Kyle Murray)
Note on the Retail Value Proposition (Krista Morrison & Kyle Murray)
411 PowerPoint Slides:
“Multiple Retail Formats and Online Grocery”
“The Rise of Retailing – Department Stores”
The physical manifes
tation of the RVP is told through the retail format in which the retailer chooses. As Marshall Field’s Chicago store in 1902 embodied luxury, magnificence, and scale in that time with Tiffany chandeliers, live orchestras, and fresh flowers throughout, Japan seems to be rivaling this with their own malls in our time. Boasting a centerpiece with a descending spiral, reminiscent of the Guggenheim Museum, this spiral ensures that every shopper starting at the top of the mall will eventually pass through every store.While North American retailers become more cognizant of time-constrained customers, Japanese retailers discount the time issue and instead enhance the customer experience by recognizing the power of atmosphere. Not only are their buildings glorious, but these retailers entice customers by integrating unusual store designs and providing entertainment where customers can soak up a concert on a rooftop amphitheatres in-between purchases.
Closer to home, the North American market is becoming saturated
with an influx of big-box merchandisers and discount retailers. However, Los Angeles is moving toward the other end of the spectrum and revisiting the trend of upscale retail. Downtown LA is set to begin construction on a $2-Billion Frank-Gehry-designed residential and shopping plaza. Building of this development is slated to happen next month, despite warning bells ringing “no sales” in many upscale retailers in the US. American banks are reporting that though retail same-store sales were up 2.2%, these sales were driven by discount retailers – “If you took out Wal-Mart’s numbers, it would basically be flat”. Upscale department stores, such as Macy’s and Bloomingdales saw its sales drop by 8.6% and upscale jewelry and apparel retailers were reportedly given the cold shoulder this holiday season.The tightening economy south of the border brings us to question whether LA is making a move in the right direction in building a massive $2-billion upscale mall and residential development in their downtown core. Just because the trend is exploding in Japan does not mean that the same success will be garnered in the US. Japan has the resources and support from their retail consumers to launch their majestic upscale malls and renowned upscale retailers such as Tiffany and Co., Gucci, and Christian Dior are responding to these changes by opening their own mammoth stores that offer not only shopping, but bars, restaurants, and spas in their outlets.
It is evident that some customers are seeking the old-fashioned upscale retail experience that shoppers were accustomed to in the 1900s. In my opinion, the US does not seem to bear the market for such extravagant endeavors, considering the state of the market at this time; however, who is to say that the reemergence of these magnificent malls will not make a strong comeback. The theory that “if you build it, they will come”, may not be a far cry for the future of upscale malls in the North American marketplace. If Japan can do it full force, why not North America?
http://www.nationalpost.com/life/travel/story.html?id=360147http://www.bizjournals.com/southflorida/stories/2002/01/21/story8.html
http://www.latimes.com/news/local/la-me-grand18mar18,1,364431.story
Note on Retail Formats (by: Krista Morrison & Kyle Murray)
Note on the Retail Value Proposition (Krista Morrison & Kyle Murray)
411 PowerPoint Slides:
“Multiple Retail Formats and Online Grocery”
“The Rise of Retailing – Department Stores”
posted by Michelle Peng at
Friday, March 21, 2008
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