Every Baby Boomer knows the building thanks to the internationally famous cover of the Pink Floyd album, Animals. However, there are now high chances that every Gen Z and Gen Alpha also discover this iconic location, but for entirely different reasons.

Built between the '30s and '50s, Battersea Power Station, located in South West London, once supplied a fifth of London's electricity. It was decommissioned in 1983 and remained dormant for years. Finally, in 2012, the building was sold for £1.9 billion. A £5 billion investment arrived from Malaysia to start redevelopment plans (it is said to have reached £9 billion in the end). The list of investors included PNB (one of the largest banks in India), Sime Darby Property, SP Setia (both Malaysian real estate companies), and Malaysia's Employees' Provident Fund.

As is often the case in such commercial development, investors had to contribute to more than the mall itself and had to fund a part of the subway station, the residential scheme surrounding the shopping centre and the 'Electric Boulevard' construction (one of the nearby streets). Redevelopment officially began in 2014 to open on 14 October 2022 with half of the commercial units having tenants (Covid delayed the opening from 2020 to 2022).

Following the 2023 IADS General Assembly held in London in November 2023, the IADS team had a chance to visit the premises. Now that the mixed-use project is almost completed and all units have tenants, is Battersea Power Station just another shopping centre or is there more to it? Most importantly, is it viable in the long term? What can department stores learn from this one-of-a-kind venture?

IADS Exclusive: Is Battersea Power Station just another shopping centre?

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IADS consolidated 2023 holiday window displays from around the world in the latest Christmas window report. Have a look at how IADS members and other department stores are capturing the holiday spirit through their artistic and inspiring interpretations.

DEPARTMENT STORES WINDOWS, IN-STORE INSTALLATIONS, VISUALS & SOCIAL MEDIA SPOTS

IADS Exclusive: Department Stores Christmas Windows 2023

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Disruption has been a very fashionable word in the past years as a general way to call for transformation in many markets where digitalization has changed the rules of engagement. Retail has not been spared of course by the rise of e-commerce, and for the past decade, retail CEOs have scratched their heads on how to adapt their analogue and legacy organisations to the new world. Going beyond the fact that everybody in the industry acknowledges that changes are needed, how can these be carried out effectively?

Back in September 2020, Dr Christopher Knee tackled the topic in his article "Responding to Disruption." In that article, he was reviewing Geoffrey Moore's 2015 theory (explained in his book Zone to Win) that, to innovate, companies should create dedicated spaces with specific teams, in charge of leading changes. Of course, this raises many questions in terms of how to maintain a common culture, purpose and sense of equality in century-old organisations where the sense of belonging is key. In his article, Dr Knee reviewed many real-world business cases, from Rinascente to Galeries Lafayette or SKP, Neighborhood Goods and Showfields.

A recent trip to Dubai to attend a series of conferences was the opportunity for the IADS to listen to another interesting business case, from Al Tayer, on how they created their online activity from scratch back in 2016. It is remarkable for two reasons: the first one is that Al Tayer usually keeps its business initiatives private, but the second one is because the way they carried the changes within the company can be seen as a real-life application of what Dr Knee explored back in 2020.

IADS Exclusive: Ounass.com, a case of internal disruption

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IADS consolidated 2023 Fall-Winter window displays from around the world in the latest Fall-Winter window report. Have a look at how IADS members and other department stores are capturing the upcoming new seasons through their artistic and inspiring interpretations.

DEPARTMENT STORES WINDOWS, IN-STORE INSTALLATIONS, VISUALS & SOCIAL MEDIA SPOTS

IADS Exclusive: Department stores Fall-Winter windows 2023

IADS provides its members with a weekly in-depth analysis on retail-oriented topics.

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*Following the IADS CEO meeting in Mexico City last May, the IADS had the opportunity to travel to Panama to discover the Felix B. Maduro and Steven's department store chains. The purpose was also to meet with the Felix B. Maduro leading team.

Small in size, but with a disproportionate GDP, Panama is an interesting country, standing both as a transit point between North and South America and as an entry gate (the country is dubbed "the Hub of the Americas). While the Canal is a significant driver of the country's economy, annually racking in $2bn and contributing 3% to the country's GDP, it contributed to the development of a very dynamic service sector now representing 80% of the country's economy.

Thanks to the service sector in a well-connected country, Panama was able to grow its GDP four times the regional average prior to the Covid-19 pandemic, at an average of +4.7% p.a., and in 2023 should grow +5.7%. As such, the combination of such dynamism with the fact of being a hub allows the country to attract regional and international money, which in turn favors retail.

We review our market visit below to understand how local department store companies have adapted to such conditions.*

IADS Exclusive: Panama, a call for differentiation

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IADS recently held a meeting on Men's fashion brands to look out for in 2023. Based on market research, IADS and NellyRodi presented a curated selection of 16 brands that are trending right now. Check out our selection of these brands!

IADS Exclusive: Brand Roundup: Cosmetics, Beauty & Wellness 2023

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Following the IADS CEO meeting in Mexico City last May, where IADS members were able to visit the latest developments in El Palacio de Hierro's flagships, the IADS had the opportunity to travel to Salvador to discover the Almacenes Siman stores. The purpose was to discover the market, know more about the company and meet with the leading team.

Siman is a 102-year-old company, operating in 4 countries with 15 stores, in addition to an e-commerce channel. It is almost fully covering the Chortis Block, the continental fragment where Honduras, Nicaragua, El Salvador and Guatemala are located (even though the company does not operate in Honduras but in Costa Rica instead).

Through an astute mix of clever business steering, opportunistic alliances and smart investments, the company managed to become the largest department store company in Central America throughout its history. As Siman is currently involved in a strategic business transformation in order to address the 21st-century challenges in the best position possible, the timing was perfect to discover this company which has become with time a driving force in the region and intends to stay the same in the coming years.

We review our store visit below to better understand this retail giant which is quietly growing on highly dynamic albeit not on the world map markets.

IADS Exclusive - Siman, ready for expansion

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*Improving Private Labels' profitability is crucial to the department store business and is a top-of-mind priority for CEOs (this is why the 2022 Academy worked on this topic). Two major strong trends can be seen here:

-    Organisations (including the supply chain) have been reviewed and changed to be more cost-efficient as well as more agile.

-    Secondly, whether they are under an umbrella brand or not, Private Label portfolios have been reshuffled, which often resulted in the discontinuation of some brands to maintain margins, but also in opportunistic ventures.

Besides these 2 major sources of optimization, new questions are emerging lately. Improving branding and awareness is key to developing the business. The pricing strategy offers 2 different directions: the lower-price path, or a possible premiumization of Private Labels which is increasingly considered to grow margins. In addition, department stores and retailers sit on a data treasure as they know who's buying what, where and how. With the emergence of the retail media business, it seems data could be leveraged to improve Private Labels' efficiency and relevancy. However, some questions remain, and the Private Label digital strategy and the communication on CSR efforts are among the most important ones.*

IADS Exclusive: Private Labels' noteworthy initiatives to improve profitability

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Following the IADS CEO meeting in Mexico City last May, the IADS had the opportunity to travel to Chile to visit Paris Department Stores' and Falabella's flagships, located respectively in the Alto Las Condes center and in the Parque Arauco mall.

Chile is considered one of South America's most prosperous nations, in terms of competitiveness and income per capita. Before the pandemic, with consistent GDP growth of around 3% to 4% annually, the country enjoyed economic diversification across sectors like mining, agriculture, manufacturing, services and tourism. The nation's stable institutions, market-oriented policies, extensive trade agreements, and high global competitiveness rankings attracted foreign investment.

The COVID-19 pandemic had a profound impact on Chile, affecting various aspects of society, the economy, and public health. The country witnessed a significant number of confirmed cases and fatalities, placing immense strain on the healthcare system. To curb the spread of the virus, strict measures such as lockdowns, travel restrictions, and social distancing were implemented. Being one of the leading countries in terms of vaccinating its population as early as December 2020, combined with the massive adoption of digital technologies and telecommuting, Chile was able to weather the crisis earlier than other countries, and this showed in Falabella's numbers, then a member of IADS. While GDP shrank by -5.8% in 2020, it grew +23% in 2021, exceeding the previous record of 2018. While normalization took place in 2022, this led to an extraordinary expansion for retailers, both in nominal and in terms of e-commerce growth, a channel already well implemented in the country.

Falabella opened in great fanfare its newest flagship store in November 2021 (our report here) and it was hailed as a perfect integration of omnichannel practices into a physical store. The IADS took the opportunity of a visit to the region to go and review the store, and to compare it with its competitor's neighbouring flagship store, Paris.

IADS Exclusive: Chile, the land of omnichannel

IADS provides its members with a weekly in-depth analysis on retail-oriented topics.

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*In recent years, inventory tracking has become increasingly sophisticated and popular. In that regard, RFID (radio frequency identification) is being used to provide real-time location tracking of inventory items. In 2021, a study conducted by Accenture revealed that the use of RFID in North American retail was booming with 93% of store chains saying that they are using RFID, especially as e-commerce grew so quickly with Covid. In addition, RFID can be coupled with endless other technologies, such as the Internet of Things (physical devices embedded with technology and connected), to offer customers more unique experiences.

Also according to Accenture, information captured from RFID technology can be used in collaboration with blockchain, supply chain analytics, self-checkout, supporting omnichannel fulfilment, reducing stockouts and improving customer engagement.

In addition to more efficient inventory management, RFID can help reduce supply chain waste and help businesses to grow more sustainably at a time when consumers are increasingly asking retailers for more responsible operations.

So, what's not to love about RFID? It happens that successful case studies are plenty, but as discussed during the IADS Supply Chain Meeting held in June 2023, there is no consensus about RFID among IADS members. Let's understand why.*

IADS Exclusive: Despite proven ROI, the RFID technology is still being questioned

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The Mexican member of the IADS, El Palacio de Hierro, is one of the largest in the world by turnover. Founded in 1891 with a store in the centre of Mexico City, the company was the first Public Limited Company in the country's retail industry. El Palacio de Hierro, owned by Grupo Bal, is also the owner of shopping centres in the country.

Lately, the introduction of experiences to generate traffic and answer customers' expectations has been key to El Palacio de Hierro's strategy. Whether it is Polanco, Perisur or their new Coyoacan store, each of them offers something unique, from architectural features (such as Coyoacan's huge 1,270 square-meter glass dome on the top floor) to product offerings and unprecedented and tailor-made services. Celebrating Mexican history, culture, and art, each store reflects the group's strategy of offering different designs inspired from their direct environment.

The IADS travelled to Mexico for the CEO mid-year meeting in May 2023, an opportunity to visit the Coyoacan store and the recently refurbished Polanco and Perisur stores.

IADS Exclusive: The secret sauce to El Palacio de Hierro's excellence

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The IADS attended the GDI 73rd International Retail Summit held in early September 2023 in Zurich. Lecturers discussed the decisions retailers should make in uncertain times when costs rise and margins shrink. Money is now becoming scarce, the pandemic destroyed supply chains, and the war in Ukraine is causing energy shortages and high inflation. Consumers are becoming more price-sensitive. And while some companies are downsizing their workforce, others are desperately looking for employees.

What should retailers do when costs rise and margins shrink? Streamline offerings, robotise services, stop sustainability initiatives? Optimise the present now – or invest in the future? What to do? And even more importantly, what not to do?

"More focus!" is the magic formula according to GDI. For retailers, this means setting bold priorities, implementing rigorous decisions and taking responsibility: not just for the shelves, but also for the people – customers and employees – to build trust. The IDAS put together a sum up of the conference lectures and talks.

IADS Exclusive: Perspectives from the 2023 GDI conference

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Back in March 2021, Dr Christopher Knee shared his views on cultural goods, specifically books, in an IADS Exclusive. Two years later, the cultural goods footprint in retail is growing in renewed ways, justifying a new look at the topic.

Several reasons are underlying the cultural goods trend. On one hand, the cultural goods business at large is growing as explained by Bain & Company and Altagamma in their 2021 luxury report: with the reopening of art fairs, the art market recorded a post-Covid renewed interest in art with an increasing participation of new and younger consumers buying in the mid-priced segment. Besides investment and speculation purposes, this phenomenon is also sustained by the new pivotal role of home and the intertwining of living and working. On another hand, many luxury brands are morphing from high-quality product manufacturers to cultural actors, offering consumers 'on steroids' value proposition and raising the bar for other retailers.

This expanded value proposition is an additional way to answer new consumers' expectations for more experiences beyond the traditional retail transactional relationship. From that perspective, increasing the retail's cultural component and the cultural goods offerings represent an additional opportunity to drive traffic in stores and possibly generate additional turnover.

IADS Exclusive: Culture and department stores: a match made in heaven?

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ChatGPT constantly made the headlines for the past 9 months and its adoption was massive (it reached 100m monthly active users in January 2023, 2 months after its launch. For comparison, it took 9 months for TikTok and 2,5 years for Instagram to reach the same amount of MAU). However, ChatGPT is just the tip of the iceberg, more precisely a 'demo' product showing to the general public the capabilities of Generative AI (a system able to answer queries, or 'prompts', after having been trained on large amounts of data, and therefore capable to bring answers which are going further than simply mimicking the data it learnt).

Generative AI has already started to disrupt many industries and retail is no exception. This is the reason why IADS invited Cyrille Vincey, Partner in Advanced Analytics at Bain & Company, to provide IADS member CEOs with more information and give a few examples of use cases in retail.

IADS Exclusive: What retailers should know about AI

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Europe is on a mission to become the world's first climate-neutral continent by 2050, but this is not a small feat. To achieve such a status, the EU is having to crack down on the way businesses are run and how people conduct their everyday lives in Europe. As a way to reduce the environmental impact caused by retailers, the European Union has started to define and impose new regulations that retailers must comply with. These directives are coming in waves and impacting certain players differently than others, thus raising questions and needing clarification.

There are many of these sustainability regulations already in effect, but they are continuing to develop and become more stringent as the EU strives to become more sustainable and environmentally conscious, especially as it seeks to lead the world on the road to a more sustainable future. The IADS pulled together the opportunitites around these regulations that businesses can adhere to their advantage.

IADS Exclusive: How retailers can turn sustainability regulations into opportunities

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IADS recently held a meeting all about the Sportswear brands to look out for in 2023. Based on market research, IADS and NellyRodi presented a curated selection of 15 brands that are trending right now. Check out our selection of these brands!

IADS Exclusive: Brand Roundup: Sportswear 2023

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IADS recently held a meeting all about the Cosmetics, Beauty and Wellness brands to look out for in 2023. Based on market research, IADS and NellyRodi presented a curated selection of 10 brands that are trending right now. Check out our selection of these brands!

IADS Exclusive: Brand Roundup: Cosmetics, Beauty & Wellness 2023

IADS provides its members with a weekly in-depth analysis on retail-oriented topics.

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IADS recently held a meeting all about the Home & Decor brands to look out for in 2023. Based on market research, IADS and NellyRodi presented a curated selection of 16 brands that are trending right now. Check out our selection of these brands!

IADS Exclusive: Brand Roundup: Home & Decor 2023

IADS provides its members with a weekly in-depth analysis on retail-oriented topics.

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IADS recently held a meeting all about the Women's Fashion brands to look out for in 2023. Based on market research, IADS and NellyRodi presented a curated selection of 10 brands that are trending right now. Check out our selection of these brands!

IADS Exclusive: Brand Roundup: Women's Fashion 2023

IADS provides its members with a weekly in-depth analysis on retail-oriented topics. This is an example of the themes the Association regularly addresses, and the topic of an article from the IADS members-only newsletter date 02 August 2023.

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The IADS attended the 2023 edition of the Global Fashion Summit which took place from June 27th to the 28th in Copenhagen. This year's theme was "ambition to action" and was an opportunity for industry leaders and professionals to share their knowledge, tools and experience to help shift the industry from vague aspiration towards concrete implementation to achieve a net-positive industry.

The overall tone of the summit was rather ominous - the clock is ticking, as 2025 sustainability targets are approaching quickly and seem unachievable, 2030 targets are the new focus as the global climate emergency becomes more pressing, and the fashion industry is not moving fast enough. In efforts to push the industry forward, the conference was an opportunity for industry leaders to share actionable case studies, step-by-step guides and conversations aimed to simplify complex topics. The IADS highlights the key takeaways and important resources for our members below.

IADS Exclusive: Global Fashion Summit 2023: The clock is ticking

IADS provides its members with a weekly in-depth analysis on retail-oriented topics. This is an example of the themes the Association regularly addresses, and the topic of an article from the IADS members-only newsletter date 26 July 2023.

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Following the IADS CEO meeting in Mexico City last May, where IADS members were able to visit the latest developments in El Palacio de Hierro's flagships (Coyoacan, Polanco and Perisur), the IADS had the opportunity to travel to Ecuador to discover the De Prati stores. The purpose was to understand more about the market, the company and the vision of the CEO, Priscilla Altamirano.

A rather small country when compared to its neighbours (Colombia and Peru), Ecuador is classified as an upper-middle-income country, with a developing economy dependent on exports (agricultural products, oil). The country regularly topped the South American GDP growth charts in the 00s and even ranked the second most performing country in 2022. Since 1999, extreme poverty decreased significantly, and employment increased, fueling the growth of the middle class which aspired to consume.

De Prati, which was founded in 1940 in Guayaquil, the trading centre of the country, managed to fulfil these needs, becoming the largest department store company in the country, with 16 stores and an e-commerce website. Unlike its European counterparts, which had available resources to learn from each other and innovate (thanks to organizations such as the IADS, but also through a vast array of suppliers and brands, and the lack of regulation at the time which allowed unrestricted data exchange), De Prati, while always being the leader in the country, had to invent each step of its development by itself, by developing in-house what was needed and finding solutions on its own.

The result is a company that has been posting an average EBIT margin of 20% and a net profit margin of anywhere between 13 and 15% for the last decade, with a much-loved retailer brand and strong social involvement. This is not too bad for a business that has developed almost in a closed circuit, which makes it an interesting use case to review the company's competitive advantages, as well as the stores that we visited.

IADS Exclusive: De Prati, a perpetual evolution

IADS provides its members with a weekly in-depth analysis on retail-oriented topics. This is an example of the themes the Association regularly addresses, and the topic of an article from the IADS members-only newsletter date 19 July 2023.

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The IADS attended the 2023 Viva Technology conference that took place from June 14th to 16th in Paris to scout the key trends and interesting startups that could be of value to our members. We have highlighted the most relevant retail trends, topics and solutions that were strongly featured in this year's edition of VivaTech.

VivaTech 2023 reflected the current state of the world – AI is all the buzz! Meanwhile, AR and web3 technologies are also still a significant focus as businesses gain a better grasp of how to leverage these technologies properly. And of course, businesses cannot write off the topic of sustainability, as the impending regulations are looming over their heads.

IADS Exclusive: Vivatech 2023

IADS provides its members with a weekly in-depth analysis on retail-oriented topics. This is an example of the themes the Association regularly addresses, and the topic of an article from the IADS members-only newsletter date 12 July 2023.

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The IADS recently had the opportunity to visit THAT Concept store, located in the Mall of the Emirates, which represents a new breed of retail in a region dominated by malls and department stores.

THAT Concept store, taking on many of the concept-store codes known elsewhere in the world, includes many of the recent innovations spotted here and there across the planet, often made by department store companies looking to reinvent themselves through smaller formats, acting as showrooms located closer to communities of customers. Interestingly enough, this concept store is owned and operated by the Majid-Al-Futtaim Group (MAF), which uses it both as a window of its retail savoir-faire and also as a testing ground for brands.

For all these reasons, we review our store visit below, in order to understand how a mall owner turned franchise operator is using a concept store to deepen its retail expertise in all formats and test brands for further expansion, and share learnings for department stores across the world, especially for the ones currently experimenting new formats.

IADS Exclusive: THAT Concept Store, Dubai

IADS provides its members with a weekly in-depth analysis on retail-oriented topics. This is an example of the themes the Association regularly addresses, and the topic of an article from the IADS members-only newsletter date 05 July 2023.

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The IADS travelled to Sweden last April to meet with the new CEO and owner, Mr Ayad al-Saffar, almost a year after his inception at Åhléns. The purpose was to discuss and understand his plans and vision for the century-old department store company.

After a first year spent reviewing the fundamentals of the company, Mr Al-Saffar started to operate significant and structural changes to the business model, and they might very well be a game-changer in this part of the world. Rather surprisingly given the fact that Åhléns already operates 47 stores in a country with 10.42m inhabitants and ranked second in Europe in terms of retail density (after Monaco), he also detailed his plans to open more stores in second and third-tier cities, thanks to his new approach to business.

We review our store visit below to understand to what extent Åhléns will revolutionize the Nordic market with its new approach

IADS Exclusive: Ahlens, the Nordic disruptor?

IADS provides its members with a weekly in-depth analysis on retail-oriented topics. This is an example of the themes the Association regularly addresses, and the topic of an article from the IADS members-only newsletter date 28 June 2023.

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