At the recent ‘Food is the New Black’ retail event held in Sydney, industry experts presented insights into how food retailing is just like fashion—an industry driven by trends, seasonality and hype.
The event, hosted by AMP Capital Shopping Centres (AMPCSC) and the Australian Fashion Chamber, centred on the concept of ‘food fashion’. This relates to how consumers are increasingly looking to retailers to provide interesting experiences, in addition to goods for sale.
In the food sector, shoppers want to experience the latest trends in cuisine while also being entertained and socialising with friends. Retailers who can make their brand ‘fashionable’ by adapting to these trends will increase their appeal to customers, in particular with millennials.
Food brands must adapt
All speakers—including Fabian Rebelo, CEO of Australian Retail; Francis Loughran, founder and managing director of Future Food; and Narelle Hutchins, head of place strategy at AMPCSC—agreed that food brands need to adapt to the rapidly changing marketplace to ensure longevity.
For AMPCSC, Hutchins said that food is increasingly important across the company’s portfolio of centres in Australia and New Zealand.
“Shoppers aren’t just visiting our centres for the essential food top-up, but also to connect with friends and relax and recharge over a casual meal or a few drinks,” she said.
“The 2016 AMPCSC Recommended Retail Practice Report, released in July, found that 82 per cent of shoppers would spend as much or more if food experiences were designed to provide opportunities to relax and have time out.”
Hutchins said AMPCSC takes a “place-led” approach in the planning and design of its 27 centres. “We know that shopping centres are increasingly becoming hubs for community activities, and much thought and effort goes into ensuring our centres provide meaningful and valuable experience to all shoppers.
“Similarly, there’s real opportunity for retailers around food offerings—if the brand provides ‘insta-licious’ or likeable and sharable experiences that are unique to the shopper, we know this can drive increased engagement with the brand and overall sales.”
F&B becoming more important for shopping centres
According to the Urbis Shopping Centre Benchmarks 2016 report, the percentage of space dedicated to food and beverage (F&B) outlets has increased by about 5 per cent in Australia’s regional shopping centres as retail landlords adapt to global trends.
The report also found that F&B sales in large regional centres grew by over 3.6 per cent this year, while specialty apparel turnover only grew by 1.3 per cent. In neighbourhood centres, F&B sales were up by 9.9 per cent, while apparel turnover decreased by 6.9 per cent.
Founder and managing director of consultancy Future Food, Francis Loughran, said the Australian trend echoes what is happening in the United States.
“Restaurants and food venues have accounted for 45 per cent of all shopping centre expansions in the USA over the last five years, and we are seeing Australian shopping centres adapting to this trend as well,” she said.
“We expect demand for food and beverage experiences will continue to grow, and trends such as integrated food halls offering both fresh and prepared food will guarantee the future of bricks and mortar shopping centres.”
Key insights from the Talking Shop ‘Food is the New Black’ event:
- Restaurants and food retailers have accounted for 45% of all shopping centre expansions in the USA over the past five years.
- Food outlets’ gross lettable area grew by around 5% in Australian regional shopping centres in 2016.
- Food and beverage sales in large regional centres are up by over 3.6%, and sales in neighbourhood centres are up by 9.9%.
- 82% of shoppers would spend as much or more if food experiences were designed to provide opportunities to relax and have time out.
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