Christine Hager, Chair of the German Council of Shopping Centers e.V. (GCSC).

Good Mood and Exciting Perspective

“The complete focus on the customer, with his ideas and wishes regarding shopping, has progressively become the benchmark for tailormade developments.” By Christine Hager.

For three years now, the German Council of Shopping Centers has questioned its members at the end of each year about the mood in the industry over the past year as well as the mood regarding the new year that is set to begin. The balanced mix of participants across all sectors, together with a good, stable number of participants, provides an overview of the atmospheric picture in the German retail industry.

Looking back, we can see that business in 2018 shaped up well at 85.2%. That is the highest figure for three years, although it is interesting to note that center management companies and operators, in particular, gave a significantly more positive assessment. However, the mood is slightly clouded, albeit at a very high level, for 2019.

Around 79% of respondents expect a very positive to positive business performance, while 3.5% expect a negative course. 17.4% are undecided about what is to come. In detail, the survey then provides insight into the key challenges and reasons for the mood. 37% see the development towards omnichannel trading as the biggest challenge in the industry, followed by 14% who consider the topic of customer orientation to be particularly important. The third biggest challenge, at 13%, consisted of rents, yields, and turnovers.

Looking at the challenges and the continued good mood, I realize that there is a steadily growing, and soon powerful, movement of change in the German retail real estate sector.

More and more companies have begun to deal with digital technologies in order to develop brick-and-mortar retail into successful omnichannel trading. The complete focus on the customer, with his ideas and wishes regarding shopping, has progressively become the benchmark for tailormade developments.

What is new for me is the fact that companies are increasingly driving themselves to become better and less driven by pure online trading. This recurrent self-confidence of brick-and-mortar retail in an omnichannel world may eventually lead to a continued good mood in Germany during turbulent times elsewhere.

The fast availability of goods and the genuine, “real” shopping experience that offers a large variety of products can only exist in a stationary trading world that includes simultaneous omnichannel trade. Pure online retailers will not be able to afford that. In the end, customers are human and want things that are personally sold by people. Therefore, optimism in Germany is also appropriate for 2019.

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