From Martini bars in Milan to buying conchiglie in Carluccios, meet the modern retailers who are reaping the benefits of combining the shopping, eating and drinking experience.
Back in the 90s, or even as recent as the Noughties, if you entered a shop drinking a can of coke or eating a Mars bar you would be approached by a shop assistant and asked to leave the premises or at least told to finish your food before re-entering. They were in fear of merchandise being damaged or litter being dropped.
A decade on and retailers are almost encouraging you to ‘consume’ whilst shopping. To the extent that more and more retailers are providing their customers with a food and beverage offer in-store.
This is done in one of two ways; either through partnerships between a retailer and food and beverage operator (F&B); or, alternatively the approach is for retailers to operate the F&B service themselves, which enables the retailer to put their own stamp on the concept and maintain its brand identity. The latter is becoming more common for retailers as it enables them to dictate.
Making food and drink the focal point in retail
Retailers, aside from department stores who more often than not provide food and beverage on the upper floors, are now using their F&B area as the focal point of the store.
Take Rapha, the successful, high-end, cycling retailer, as an example. Their stores in London, New York and Sydney all have a coffee and pastry offer, and it is slap bang in the middle of the store in order to create an atmosphere. This was most noticeable during the Tour de France last year when they had TV screens set up, morning coffee flowing and ultimately a huge increase in sales during the 2 week period
. Rapha, London
How emphasising food and drink can benefit retailers
There are three key reasons why retailers are adopting this strategy:
- Increases dwell time, which in turn may increase sales volumes
- Provides an experience, which is something that retailers are constantly trying to achieve in their stores and we have explored in our Redefining Retail Places research project
- Gives them the opportunity to differentiate themselves
Retailers taking inspiration from restaurateurs
In my opinion, and it will come as no surprise, the market leaders in delivering successful retail/F&B environments are the Italians – both are in their blood! You only need to visit the Martini Bar in the D&G store in Milan, or the famous 10 Corso Como to understand the benefit to the retailer of having a bar or restaurant concept on the premises.
Restaurants having been adopting the same business model for years, well before retailers. The only difference being that food is the primary focus rather than retail. Selling ingredients within a restaurant is something that independent operators do all over the world, whether it is Kowloon in Hong Kong or Battersea in London. The combination of restaurant and shop gives the premises a genuine effect if the fit out is done appropriately. Carluccio’s is an example of an international chain that combines both a restaurant and shop concept. It has successfully expanded into international markets, such as the Middle East and Turkey where the concept has been well received.
Another example of how to successfully deliver F&B within a retail environment is the new Replay flagship in Milan. This combines a 650 sqm retail store, 100 sqm cafe, and a 900sqm restaurant/bar. The entire concept is managed and operated by Replay. The architecture is phenomenal and the excitement in-store and restaurant is infectious. I encourage you to visit when you are next in Milan. You won’t be disappointed!
And let’s not forget the fabulous Eataly brand which positions itself as a ‘food department store’ and is fast becoming a household name across the globe. They have opened outlets in New York and Istanbul in the last year and we have tracked this in JLL’s latest European retail report. Additionally, we introduced a new section in this report, Destination Europe 2015, that explores the growing and ever important Food and Beverage market. Please head to the Destination Europe homepage for further information.
Some of my colleagues enjoying a cocktail in the Martini bar at D&G, Milan
Whether it is retailers providing an enticing F&B offer, or restaurants selling product, retailers and leisure operators across the globe are beginning to capitalise on the strong links between shopping, food and drink, something I look forward to discussing with retailers, investors and developers at the ICSC Retail Connections Conference.