Welcome to the the Ivey HBA Retail Marketing Management blog. Retail marketing is an exciting, dynamic, important, and very visible aspect of the overall field of marketing. Throughout the year, students will be posting comments regarding contemporary retailing issues. Although this is intended to be used by Bus 4411 students, industry marketing professionals are also invited to join in if they like.

Tuesday, March 24, 2009

After having spent three months studying marketing, I ended up thinking that I should look for the definition of marketing. If I understand correctly, marketing aims to maximize the commercialization of a product by adapting the future product to the needs of the market in order to attract potential customers. Neil Borden developed his concept of marketing mix consisting of four main elements: product, price, placement, and promotion. Two of these four components can interact with architecture: placement and promotion. Since the product needs a physical place to be sold, the construction of a building is necessary. Furthermore, this building can be a form of advertising since it displays the brand: its name and its environment. We tend to forget the importance of architecture in retailing, yet it is as crucial as the packaging of the product. In fact, architecture is packaging. Retailers have to overcome what I would call the Masonville syndrome. What does it mean? A simple concept, the Masonville syndrome refers to any ugly and mundane mall. I point out that on the website of Masonville Mall, we cannot find any picture of the exterior aspect of the mall. [i]

Even if we think that marketing is much more integrated by firms today than before, the nineteenth century can give us some lessons in terms of retail architecture. Department stores and shopping centers were often characterized by their beauty, their elegance and their majesty. Europe, and then the USA, became covered with these new cathedrals, such as Les Galeries Lafayettes in Paris, le Passage Pommeray in Nantes (pictured left), Galleria Vittorio Emanuele in Milan or Queen Victoria building in Sydney. Why did the owners of theses shopping centers decide to spend so much money in the building? Because it is profitable.

Commercial architecture is a field of architecture caters especially retailers and it strives to accomplish two goals. The first goal is to attract the consumer in the store and to urge him or her to buy. The second one is to build brand equity for the firm by creating a special environment in the store, because the store is a medium. A few criteria have to be taken into account in the construction of a building: consistent representation of the brand and atmosphere, readable signs, free movement of the people, and similar store design in all locations. The cosmetic firm L’Occitane en Provence with its South of France atmosphere or Hollister with its South of California atmosphere exemplify the issues of commercial architecture.

Focusing on the architecture and the design of a store is not a gimmick; it must be a major aspect of the strategy of a retailer. Some surveys testify the positive return on investment after the renovation of a store. For instance, I found a survey on 113 retailers of every size base in the region of Lyon, France. According to this survey, 99% of the retailers recognized that the renovation was positive or very positive, 80% of them had an increase of their turnovers, 56% recognized that their customers bought in average more, 76% thought that the profile of their customers was younger and more upper-class, and 40% intended to do a new renovation in 5-10 years.[ii] Broadly speaking, the consequences of the renovation were very positive in terms of sales volumes, customer traffic and brand image.

The renovation of the stores can also be undertaken part of a more general change in the marketing strategy of the firm. It’s particularly true for the French leader of men’s apparel, Celio. This retailer has been booming since its creation in 1985 and decided in 2006 to change its visual identity by trying to cater a young and urban market. Celio stressed on “male and strong” colors: red, black, and white. The logo was changed and the stores were transformed, as follows. Up to now, half of the stores have been renovated it has already affected the turnover of the firm, since turnover has increased from €350 million to €450 million between 2005 and 2007[iii].

Old Celio store and New Celio store

Unfortunately, these instances are not always very interesting architecturally speaking. A fine and original architecture can be expansive and is not very paramount for every business. A few sectors can afford such expenditures, like the luxury-sector. That is the reason why some luxury stores are brilliant pieces of architecture. I found, for example, this store with grass walls of a Belgian fashion designer, Ann Demeulemeester, in Seoul (pictured left). We can also think of the Apple store in New-York, which is minimalist and modern masterpiece. Malls should also focus on architecture. Their style can range from the swanky and kitsch of Forum Shops in Las Vegas to the modern Kanyion shopping center in Istanbul, passing by the original green Namba Parks in Osaka, or the Cour Saint Emilion village in Paris. The aim is to give an identity to your mall and to avoid the Masonville syndrome.

So, is architecture marketing? Probably, but actually, I just wanted to talk about architecture.

[i] http://www.masonvilleplace.ca/home/index.ch2
[ii] http://www.lyon-shop-design.com/pdf_reglement/principaux_resultats_enquete.pdf
[iii] http://www.celio.com/#/the-brand (in English)

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