Although Brazil is known for its daily sunshine, perfect weather, and pristine beaches many locals are skipping their time on the sand for luxury shopping trips at the mall. Even though Brazil’s economy may be starting to slow, Brazil’s high end market is booming. The boom is focused, however in the malls.
One of Brazil’s biggest mall developers, Iguatemi Empresa de Shopping Centers, expects to see 25-30 percent growth in sales in 2012. The developer also plans to open or expand at least eight malls by the year 2015. The newest addition, in São Paulo, is the JK Iguatemi mall which is the developer’s thirteenth mall in Brazil and third in the city. The mall is expecting an average of 20,000 shoppers daily and offers some of the hottest labels, such as Lanvin, Van Cleef & Arpels, Topshop, Burberry, Bottega Veneta, as well as Chanel just to name a few.
“Every time we hit a new market, we adapt to local culture. In Brazil, people are much more used to going to malls than shopping on the street. Therefore we decided to open our first stores in Brazil in malls,” stated Daniela Valadão, the brand manager of Topshop in Brazil. Such successful malls in Brazil have also caused designers such as Marc Jacobs and Giorgio Armani to close their free standing stores and open in malls.
Located just across the Pinheiros River is competing mall Cidade Jardim, developed by real estate developer JHSF. Both malls are constantly trying to gain a competitive edge over the other by offering new services such as personal shoppers, personal chefs, concierge, 4D movie theaters and impressive gyms. “A shopping center needs to provide much more than just shopping options. Customer loyalty in Iguatemi succeeded because we offer unique services. The mission of a mall is to constantly amaze customers and this has been the reason for our success,” stated Carlos Jereissati Filho, the president and CEO of Iguatemi.
Yet with heavy local taxes causing some items to cost twice as much in Brazil as abroad in the U.S. or Europe, many locals are also travelling to look for ‘bargains.’ “Since Brazilians are travelling overseas more and more, it is extremely important to have competitive pricing in the Brazilian branch,” stated Robert Bruce Harley, director of JHSF. He continued to state, “Forty to fifty percent higher compared to US or European prices would be more acceptable.” Yet even with this issue, many locals still choose to spend their money at home. Harley stated, “Brazilians are choosing to buy locally primarily due to high quality service and the availability of payment plans. Service is a very important differentiator in Brazil.”