Shopping Centres Conference – AYD Istanbul, Turkey

Damian Lewis: Managing Director

Mall Income

Fashion Show Las Vegas

‘Mall Income is all revenue that is received outside an in-line shop unit’

Any others? Other Income

Auxiliary Income Alternative Revenue

Non-Core Income Commercialisation (UK)

Casual Leasing (Australia)

Speciality Leasing (USA)

INTRODUCTION

3 Outcomes for Today:

3. It can be done!

2. What is ‘Path to Purchase’ and why is it the future.

1. What is Mall Income and how to get to 5%.

5% IS BENCHMARK

Example

Total Net Income: 10m

Shop Income: 9.5m

Other Income: 0.5m

Mall Income: 5% 3% is more common

10% is possible

WHAT’S HAPPENING WHERE United Kingdom

UK Speciality Retail 2000

2013: Strong Mall Income. Estimate at £300m

2016/17: Maturity. – Incremental Growth. Estimate £400m

2001: Little if any Mall Income. Estimate at £10m

WHAT’S HAPPENING WHERE

USA & Australia.

TOTAL SALES – KIOSKS & RMU’S

Source: Speciality Retail Magazine, ICSC

CEB TowerGroup Research (Dec 2014):

• Gift Card sales USA 2014: $124 Billion.

• 85% of USA population will exchange gift cards.

• $1 Billion left unspent on gift cards (Spillage).

• 5-6% growth for next 3 years

• Total facilities solution

• Gift cards

Achieved through: • Brand partnerships

8% now target

5% accepted at turn of century.

WHAT’S HAPPENING WHERE

• Estimation are between 3 – 4% of revenue from Mall Income.

Turkey • Very fragmented and in beginning stages of growth.

Mainland Europe • Very fragmented and usual based on ownership strategies as opposed to regions.

• Eastern Europe and developing countries generally more advanced.

• Rapid growth in coming years, minimum double figure.

• Advanced and world class initiatives, but no cohesive strategy.

WHAT IS MALL INCOME?

4 General Income

3 Brand Experience, Promotions and Corporate Partners

2 Advertising

1 Specialty Leasing, Kiosks, RMU’s & Pop-Up Shops

THINKING OUTSIDE THE BOX

THINKING OUTSIDE THE BOX

HOW TO GET 5%

Source: Speciality Retail Magazine, ICSC

Rank Category % Total Sales 2012 Category % Total Sales 2011

1 Apparel 15% Apparel 15%

2 Cellphone & Access 13% Cellphone & Access 13%

3 Personal Care & Health 11% Fashion Access 8%

4 Fashion Access 7% Food 7%

5 Food 7% Personal Care & Health 7%

6 Jewellery 5% Jewellery 7%

7 Home Décor & Access 5% Services 7%

8 Toys & Games 4% Toys & Games 5%

9 Professional Services 3% Amusement 4%

10 Personal Services 3% Home Décor & Access 4%

Total 73% 76%

• Business Plan

Optimisation & Zoning

• Identify hotspots

• Adjust retail mix

• Enhance productivity

Sales figures

• Aesthetics & demand

HOW MUCH OF EACH?

50%

25%

13%

12%

General Apportionment

Speciality Leasing

Promotions

Advertising

General Income

40%

30%

20%

10%

Dominant Asset

Speciality Leasing

Promotions

Advertising

General Income

70%

10%

5%

15%

Smaller Asset

Speciality Leasing

Promotions

Advertising

General Income

• Asset dominance

• Portfolio or stand-alone

• City or urban location

• Footfall and asset size

• Mall width

• Exclusion zones

Key Influencing Factors

PATH TO PURCHASE

Source: ‘Experience Counts’, commissioned by Marketing and RPM. Ranking: 5-

best fit, 1-worst fit

Brand Experience

Westfield Brand Ventures* • Digital Network Spectacular • Media Domination Zones • Media-Driven In-Centre Branded Experiences • Exterior Signage Domination • Garage Zone Domination • Digital and Traditional Media Dominations *Source: www.westfieldcorp.com

What is it? “From the moment a person embarks on a journey to the

actual purchase.”

EXAMPLE – MOTOR VEHICLES

7. Portfolio deals and full corporate alignment.

6. Integrated events and corporate partnership.

5. Roadshows to all major agencies and selected brands.

4. Path to Purchase Experience. Use of full media platform.

3. Integrated campaign. Use of advertising.

2. Exclusive medium to long term arrangement.

1. Brand Experience. Local Car Dealerships.

Where are you?

BLUEWATER EXAMPLE

• £ 5 million investment by Land Rover over three years

• Unique Corporate Partnership

Landrover - 2001

BLUEWATER EXAMPLE

• Outcome:

• Seen by 10 million consumers

• 16,000 Qualified Leads

• 800 motor vehicles sold directly from promotion with a value of £14 million

• Significant attitude shift towards the Ford Brand

• 4 Themes

• Female

• Football

• Performance

• Family

• Investment by Ford £ 500,000.00

• 20 Week Brand Experience

Ford - 2008

BLUEWATER EXAMPLE

Virgin Media – Speedweek 50 Jensen Button • Shopping centre roads made into race course. • Launch of 50mb broadband service. • Full brand experience immersion. • Celebrities and live TV coverage. • Over £3m PR value

03

BLUEWATER EXAMPLE

“Our independent research has revealed that almost 40% of Britons are more likely to buy a car if they can avoid talking to salesmen. Almost half say they’d be more likely to buy a car if it was as easy as buying clothes, food and gadgets.” Simon Doxon.

• Researching, financing, evaluating, creating and purchasing a new Hyundai, in-store or at home, with no obligation to talk to anyone.

• World First digital showroom. E-commerce and multi-channel retailing.

Hyundai, Summit & Rockar - 2014

03

DOVE EXAMPLE

• Research undertaken to measure change in brand perceptions.

Conducted by: HPI Research on behalf of iD Live Brand Experience

• Ran a ‘Hair History’ campaign roadshow at:

1. Festival Place, Basingstoke

2. Bullring, Birmingham

3. Victoria Centre, Nottingham

4. Meadowhall, Sheffield

5. MetroCentre, Gateshead

6. Braehead, Glasgow

7. Bluewater, Kent

• Heavy users of experiential marketing in the UK

03

DOVE RESULTS

Customer Attitude Behavioural Change Spontaneous Brand Awareness

3

34

40

59

79

83

I did not understand what the event

was about

Something only Dove could have

organised

It was educational

It was interactive

It was entertaining

It was an interesting event

Strongly agree

10

23

10

35

I did not used to buy Dove products

but I do buy them now

I used to buy Dove products and I

now buy them more often than

before

Total Users (Ever Use) 62

65

89

91

92

93

91

77

84

92

93

94

95

96Head & Shoulders

Dove ‘Any’

Herbal Essences

Garnier Fructis

Sunsilk

Dove “Intense Range”

Dove “Essential Range”

22 1828

47

29 3323

22

2

4747

Total ABC1 C2DE

3030 30 30 30 30 30

30

30 30

30

30 30 30 30 30 30

30

30 30

30

30 30 30 30 30 30

30

30 30

DoveEssentialrange

Dove Intenserange

Non-brandspecificmentions

Don't know

Targeted Consumer Groups

McARTHURGLEN Britain's Biggest Christmas Tree

2008 2009 2010 2011

IT CAN BE DONE!

• Transparency & Communication

• Lateral Thinking

• Mall Income Strategy

• Mall Income Team

• Mall Income Brochure

• Tenant Usage

• Sales figures and benchmarking

Some Ideas & Summary:

“With a strategic three year plan I have yet to come across a shopping mall that cannot achieve 5% of net rental income through the commercial use of mall space. The only caveat to this is exclusion zones and restrictive mall space that inhibit activity.”

• Agency Roadshows

SPECIFIC QUESTIONS

4. Pop-up Shops

3. Competing Interests

2. Retail Incubation

1. Who owns the money?

QUESTIONS &

THANK YOU

www.mallincomegroup.com

damian@mallincomegroup.com