A recent forecast indicated that, in 2017, the Sydney property market would gain about 21,000 apartments and 16,000 freestanding homes. They’ll all look pretty much the same – white walls, downlights, a nice timber-veneer kitchen, marketed through beguiling but identical renders. And give or take a few thousand dollars, depending on suburb, they all pretty much cost the same as well. West End in Brisbane has so many apartments that one developer is giving a lucky buyer a Jaguar (the car, not the cat) as an incentive. That’s a bit more than the free air-conditioning and stone benchtops that tempted people a couple of years ago.
So, why choose apartment X over apartment Y? Increasingly developers are realising that the point of difference is amenity; a sense of community, convenience and relevance to the lifestyle people see themselves living. Most people are better travelled than their parents, have been exposed to wider culture, are more informed, and as such have a pretty well developed idea of the lifestyle they want to lead. It’s probably best, then, to figure out what your target customer’s lifestyle vision is, and deliver it. If you don’t, that’s okay; the centre three kilometres down the road will do it for them.
So into developments are creeping cafes, dining precincts, genuinely usable public spaces, theatres, even special dining rooms that can be booked out by tenants. To combat rising prices, the apartments themselves are becoming smaller, places to sleep and not much else. The community environment becomes the living room and the garden, the place to eat, entertain and pamper. A built-in Entertainment Leisure Precinct . Everything we see as the points of difference between one retail centre and another is appearing literally on people’s doorsteps.
I complemented a client not so long ago on the comprehensive survey they had commissioned regarding their target market’s expectations. In particular, the locals emphasised that they had an overwhelming affinity for the local area and its very specific lifestyle character. It seemed quite wonderful to me that the owner had been handed a lucid roadmap of what their customers wanted, and in a very competitive trade area, too. It was a golden opportunity for relevance. The owner, however, stared at me, incredulous, and said, “You don’t really think we’re going to do any of that do you?” Great research, money well spent. Ironically the centre down the road had already worked all of this out without doing the research. They probably just wound their car window down and looked around.
It helps, of course, if what you’re offering is relevant too. It may not be online shopping that’s the threat – what if it’s that you’re just not selling anything people want? Gap got into enormous trouble by assuming that its signature white Tee would remain a cash cow forever. The company seemed to have missed that now most young people don’t want to look like they stepped off a yacht; they think rap is music, Kim Kardashian is a style icon, and chrome-plated Porsche Cayennes are tasteful, (okay, maybe not everyone agrees with that last one). They don’t want white tees. And who knows what Millennials will see as the expression of their lifestyle in a couple of years?
Worse, what if your product is, well, crap? Fast, disposable fashion is a fact of life, but we pay more for it here than Europe or the USA, so our expectation of quality is correspondingly higher. Generally, Australians seem to care less for labels and more for quality, albeit within limits. A couple of years ago, I bought a pair of shoes – really funky, cool, almost Prada-esque – from a very “in” European fashion brand. They lasted a couple of months before the sole came away. My shoe repairer of choice said the makers had skimped so much on the leather upper that the shoes were unrepairable. They were crap; they weren’t expensive, but that’s not really the point. I won’t go back to that shop. Ever. Evidently a lot of local customers agreed with my views.
Rony Abovitz, founder and CEO of Magic Leap** (probably the most interesting Augmented Reality company around), said part of the social conscience of the business is what they call the “Mom Rule”. To quote it directly: “Would you allow your mom – who gave birth to you and cared for you and gave you life – would you let her be subject to this thing we built?”*** Not a bad sort of guide. Maybe we should apply a similar one to what we do – the “Customer Rule”, or even the “Me Rule”. With everything we do, produce or are responsible for maybe we should ask ourselves, “Are we happy for the people on whom we rely upon for our continued existence to call this space home?” Or, “If I was a customer here, would I feel that this space is a relevant home for my lifestyle?” If you think acres of plasterboard in need of a coat of paint and slightly bluish high bay lighting means yes, well, so be it. But those guys three kilometres down the road might not agree, and might be acting upon it.
Remember that thought I asked you to hold? Well, online shopping hasn’t spelled the death of the shopping centre. At heart, we are social creatures, and while online shopping provides a particular service, the need to be amongst people, in an environment we acknowledge as an essential part of our lifestyle will never go away. So long as bricks-and-mortar retail stays relevant it will stay alive.
[Ironically WIRED magazine hasn’t changed that much; it’s looking a bit tired, an old tech-evangelistic anachronism. Wonder what the magazine three kilometres down the road is doing… ]
*Richard Sears from The Story of the Sears Catalog
** Founder and CEO, Magic Leap LLC
*** From the Magic Leap Blog – The Mom Rule