OXFORDSHIRE, United Kingdom— It’s the most popular destination in England for Chinese tourists after Buckingham Palace. Now, it’s coming to New York.
Bicester Village, the outlet shopping centre where brands like Celine, Prada and Coach sell last season’s stock at reduced prices in a faux English village setting, is bringing its take on discount shopping to the United States, where it will open its 12th outlet, BoF has learned.
“Next stop will be New York. It’s just in the formative stages and it should start in the next year or so,” confirmed Value Retail Chairman Scott Malkin without specifying the exact location of the new outlet. “We have this vision of a global footprint serving global brands.”
Value Retail currently has 11 outlets across Europe and China, where sales densities — the holy grail of retail metrics, typically measured in sales per square foot — are among the highest of any shopping centre globally, according to the company. In the luxury sector, where rents and store fits are extremely expensive, a sales density of over $2,000 per square foot is considered high performing. Value Retail declined to disclose current sales densities for its Bicester Village locations, but back in 2013 average sales density in the UK was $3,309 per square foot.
It’s a challenging time to enter the US market, given that overstored retailers are struggling to compete with the rise of digital-native brands, while major players like Michael Kors and Coach are cutting back on their overexposure to off-price in a drive to better manage their brands.
But much like Premium Outlets’ Woodbury Common, a high-end competitor an hour north of New York City, Bicester Village attracts an enviable mix of affluent tourists and locals who stay longer and spend more per visit than at traditional shopping centres.
Value Retail operates a different business model to Woodbury Common, however. While Woodbury Common charges monthly rent from brand partners, Value Retail takes a royalty on sales, working closely with brands on everything from store fits to staffing.
This, plus a marketing strategy that promotes its locations as luxury destinations, not outlet malls, despite the discounts on every clothing tag, helps to attract brands who might otherwise baulk, such as Balenciaga, Saint Laurent and Valentino, the company said.
Value Retail said it also pays particular attention to keeping its tenant mix fresh, with around 25 percent of brands in a given location changing each year to avoid what Malkin called “sterile perfection.” Christopher Kane, Stella McCartney and cycling brand Rapha sit alongside Burberry and Prada. Meanwhile, the company has staged pop-ups with young British designers, including Erdem and Phoebe English, as well as The Modist, a Dubai-based modest fashion e-tailer.
Competing with New York’s department stores won’t be a problem, said Value Retail Chief Merchant Desirée Bollier. “We have the freedom to invest back into our villages and that allows us to reinvent every single one of them in a very curated experience,” she explained. “And that reinvention — I didn’t see that in New York. There is really a lack of investment into memorable experiences when you go into, for instance, Barneys. Clearly, they have taken the customer for granted and you can’t, you have to reinvent the experience. It can’t remain stale. It has to be a theatre.”
Discounts don’t hurt either.