Retailers with flagship stores on the world’s leading shopping streets are benefitting from a brand awareness vehicle stronger than traditional advertising.
This was the view shared at the launch of Cushman & Wakefield’s Main Streets Across the World report at MAPIC.
Retailers can expect to pay a rent of $1,850/sq ft per annum on New York’s Fifth Avenue, or $1,134/sq ft per annum on Paris’ Avenue des Champs Elysees. But these rents were viewed as good value for money when you factor in the rise in brand awareness that they generate.
Gene Spiegelman, executive director, Cushman & Wakefield New York, said ‘Flagship stores are a better promotional investment than spending advertising dollars.
‘Rents may appear unsustainable at this moment in time but, placed in strategic context, these commitments represent exclusive long term opportunities for a highly competitive group of global retail brands who recognise the value of flagship real estate as an effective vehicle for brand communication.’
‘People are putting up their pictures of themselves taken outside our stores on Regent Street and putting them up on YouTube. No one puts pictures up of themselves taken in front of an advertising billboard.
‘That traffic raises brand awareness. We are in negotiations with a retailer seeking around 25-40,000 sq ft [on Regent Street], which is happy to wait until 2010 or 2011 for the opportunity.
‘But we probably don’t sell the brand benefits of flagship store hard enough.
‘They [flagship stores] should be giving us more rent for that opportunity!’ Shaw joked.