Anna Obraztsova, Commercial Director of ADG Group. Image: ADG Group
Opinion | Retail

The Role of the Local Community in Enhancing Retail

In order to survive, shopping centers are beginning to adapt retail, housing cultural, educational, and leisure facilities all under one roof. Since 80% of those visiting malls are Millennials or Gen Z, leisure is a hot topic within retail development.

By Anna Obraztsova

As a pioneering urban developer, we want to create useful territories: tenant-mix of neighborhood centers comprised of essential goods and services (55%), education and entertainment (including cinemas) (30%), and F&B (15%).

While consumer behavior used to be driven by price and choice, now, distance from home is the priority. In megacities like Moscow, consumption is moving closer to people, so “hyper-locality” appears to be a significant retail trend. City dwellers are tired of traveling long distances, using public transport, and dealing with traffic jams – they want to buy regular goods near their homes. Searches for places “Near Me” lead 50% of mobile users to their local stores. This is forcing big market players to change their USPs and move towards community integration. This new, localized, lifestyle-oriented approach is why we are developing pedestrian infrastructure in residential areas.

Over the past 50 years, Moscow has grown tenfold. While Soviet urban planning focused on administrative centers, industrial zones, and huge residential districts, commercial activity has grown in the opposite direction. Ten million medium-income consumers now live in densely populated but underserviced areas – in places in which we have acquired 39 former cinemas. In the 1920s “workers’ clubs”, the predecessors of cinemas, were built in industrial areas and turned into places where local residents could gather. Later, when cinema became the “most important of the arts”, standardized and affordable cinemas appeared in almost every district. Those buildings failed to adapt to the changes created by time and demand; consumers were looking for high quality sound and visuals, and, resultingly, most cinemas remained empty for decades.

Nevertheless, people love their neighborhoods, and 46% of Muscovites are involved in their local communities. Since cinemas were not only geographical centers, but social ones as well, we intend to retain this “local” feeling. Our mission is to preserve the Soviet heritage contained within Moscow’s cinemas – to breathe life into them in an effort to transform them into public spaces. To that end, we are developing an events program in which local people can get involved, and we are focusing on maximum comfort: living spaces, concierge, a coworking area, as well as terraces for picnics and yoga.

Each center will cater to local residents. Since the e-commerce boom, people prefer to have their goods delivered right to their doors. A network of Click & Collect services, connected to at least 5,000 online stores, will expand the range of goods available at our neighborhood centers.

We would also like to communicate with our customers on a more personal level. With the help of big data, query history, and geotargeting, our club-style loyalty program will offer consumers multiple reasons to visit their local neighborhood centers. Each will provide Muscovites with essential goods, exciting leisure facilities, and the development of their local communities.


Neighborhood center, Sofia. Image: ADG Group
Sign up for our ACROSS Newsletter. Subscribe to ACROSS Magazine.

Retail MORE

Decentralization and the future of retail in German city centers

As if retailers in German city centers have not had enough to contend with in recent years–primarily driven by growing competition from online retailers–now they are also confronted with even bigger economic problems due to the Corona pandemic and the associated restrictions and closures. A continuous analysis of visitor development by GfK shows what has actually happened since the start of the pandemic, who the losers and even bigger losers of the pandemic are, and what the future holds.

Going Forward! Europe’s food retail sector in the corona-year 2020: the storm of the century

Europe's food retailers are being put to the test by the eco- nomic consequences of the natural disaster Covid-19. This is a very special kind of weather situation. While non-food retailers and the food service industry are in sheer despair in the face of the calm caused by government-imposed lockdowns, the "system-relevant" food retail sector has been confronted with a veritable storm tide since the sec- ond quarter of 2020.

Food retailers in their own words

Industry leaders told us about the sales impact Corona had on their business in 2020. They also explain what fundamental changes in location, sales, and marketing strategy they are planning for 2021/2022 in response to the widespread economic impact of the pandemic.

Allowing young talents to completely rethink retail

Union Investment and Sierra Germany launched their latest edition of First Store by Alexa–a campaign by Berlin’s well-known shopping center Alexa. Ralf Schaffuss, Head of Retail Asset Management of owner Union Investment Real Estate, and Jens Horeis, General Manager of Center Management company Sierra Germany, talk about their latest innovation of the competition.

A closer look at Belgian retail parks

Retail parks have been the best performing and most resilient retail format in Belgium prior to and throughout the Covid-19 pandemic, resulting in a slight compression in yields by 25bps since the beginning of the year according to new research by CBRE commissioned by Mitiska REIM.

25 new brands came to the Czech market in 2020

Despite the coronavirus crisis, this is one brand more than 2019, according to a market survey by Cushman & Wakefield.