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The Art & Science of Shopping: Navigating the Shanghai Marketplace

I was recently in Shanghai for a conference, the Global Department Store Forum, to hear perspectives on the retail industry from CEO's of the world's best department stores. Given my passion for shopping, the presentations only made me want to go hit the streets of Shanghai and spend some Yuan. I managed to squeeze in one day of my own for just this purpose, escorted by a friend who had been living in Shanghai for a few months.

Now, as part of my job, I see department stores and malls all the time. As part of the conference, groups of us were shuttled to see local examples of this species of retail. We hit the Super Brand Mall (LOVE the name but it felt like it has a sister mall in Minnesota), the Shanghai IFC Mall (a true temple to luxury retail), and the Westgate Mall (which is a good example of a "C-level," or third-tier, mall.) This was not what I came to Shanghai to see. I live in Bergen County NJ, where there are more malls than in the entire swath of the US between the Mississippi and the Sierra Nevada Mountains. What I wanted to see was the other side: the streets of the city, the small boutiques whose name I'd never heard of, the one-of-a-kind places where you can find that perfect thing that no one else has. In the end, what I discovered was the importance of mining local culture for successful brand integration into new audiences.

We embarked on our adventure bright and early Saturday morning, our Venti-sized Starbucks coffees in hand, ready to spend. We started out at the Fabric Market, where my friend gets his clothing made at a family owned stall by the son of the owner - a nice young man named Kyle. My eye caught sight of a fabulous black cashmere coat. After much haggling and walking away several times, the calculator finally read a number we both could live with. I walked off with my new coat and the stall keeper was $60 USD richer. No, I didn't leave off a zero, I said $60 USD.

Walking through the Old Town area, we made our way to Yu Gardens. Yu Gardens is a gigantic house (think of Hearst Castle but in downtown Shanghai instead of on a mountain in California) that was formerly an opulent private residence now turned retail mall. Jumping in and out of the shops, the merchandise all started to look the same - possibly because it was.

Moving on, we taxied over to the Fake Market, which resembled an indoor, vertical flea market. Personally, I enjoy flea markets, and although I felt ready for it based on forays through flea markets in many cities, I instantly observed that shopping in China is a full-body contact sport. Bobbing and weaving through the stalls, we repelled assaults by the stall keepers like a running back making his way down field toward the end zone, searching for the stall that was worth pausing at. Handbag stall after handbag stall, passing by t-shirts, cashmere and silk, we pressed through until we arrived at our destination: a seemingly innocent handbag stall, where we finally gave in to the sales prowess of a sweet young girl named Seven (I guess they still get Seinfeld reruns in China too). This experience was the height of my journey.

It would seem that while handbags were the public offering, counterfeit watches were the true business. Seven took us into a back room and welcomed us to sit down on small foot stools for the transaction - a very intimate and cozy environment which I’ll surely draw inspiration from when next designing a high-end jewelry or department store. She showed us a catalog of watches, and we picked a few brands that piqued our interest. Suddenly Seven was on her feet, rapidly keying in a code under a shelf, and one of the stock room walls swung slowly open. I felt like I was in Oz. She disappeared, reappearing seconds later with rolled cloths containing many styles of watches. She was patient - an expert salesperson despite her young age, who was willing and eager to satisfy our spending urges. While the temptation was great to splurge on expensive-looking watches for an amazing low price, we resisted and moved on to lunch. The rest of the day was spent wandering in the French Concession, which I highly recommend for those who crave indy boutiques, followed by an amazing foot massage at a local spa.

As I reflect back on my shopping experiences in China, I realize that the country’s indisputable advantage lies in the nation’s deep-rooted cottage industry and natural willingness to make a deal, and while the Chinese retail sector is rushing to implement "modern" retail practices, this advantage should not be overlooked. They get it. They know everything has a price, and that price is not always the same for everyone. And at the end of the day, they WILL make the sale - and if they don't, it is DEFINITELY not for lack of trying.

It was ironic though, while I was wandering the Shanghai IFC Mall, to notice the difference between the consumer experience in the Chinese shopping mall and the consumer experience in the local markets that we had visited. The essence of the true Chinese shopping experience was boiled out of these the premium luxury stores and it was not replaced with anything else. Nothing. Once the staff's hands were tied - to not be who they are naturally - they didn't know who to be, so they just weren't.

As Western retailers expand into this new consumer promised land, take note: it is different there. Embrace the difference. Capitalize on it. Be willing to bend your brand to work in this new environment. Synthesizing your experience to be global does not mean to be the same everywhere, it means for the consumer to feel the same after they make the purchase, and they leave with their treasures.

Make sure to check out the slideshow below documenting my experience in Shanghai. To flip through the pictures, click on the icons that appear at the bottom.

Kathleen Jordan
Kathleen Jordan is a principal in Gensler’s New York office, and a leader of our retail practice with over 24 years of experience across the United States and internationally. Kathleen has led a broad range of retail design projects as both an outside consultant and as an in-house designer. She has led projects from merchandising and design development all the way through construction documentation and administration, and many of her projects have earned national and international design awards. Contact her at kathleen_jordan@gensler.com.

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    They don’t even attend the family meetings because of their busy routines. They used to say that they are busy they can’t attend the family events but sometimes they are just avoiding their families.

Reader Comments (5)

Kathleen, this is a great article! What a great day geting to experience the real Chinese retail experience. Wrapping it up with a foot massage was a great choice!
07.22.2011 | Unregistered CommenterJason S
Wow Kathleen, loved reading your observations. I've always been amazed at the amount of luxury shops in 1st tier Chinese cities. I wonder if this strategy is more about brand building than sales.
07.28.2011 | Unregistered CommenterBarry Bourbon
I have to agree some of the flagships I've seen, certainly in Japan, are more about marketing value than they can possibly be about real ROI from product sales alone. The amazing thing about China is that there are 600-700 cities in tiers 2 & 3, each with populations approximately the size of Manhattan. The Chinese economy has overtaken Japan as the #2 consumer economy at 40%, and estimates are that it will match the US by 2015, 2020 the latest. What will be truly interestesing to watch will be as the Chinese manufacturers turn away from being mere suppliers to foreign brands, to becoming brands themselves, and the ensuing growth of the domestic Chinese supply market.
08.15.2011 | Unregistered CommenterKathleen
Kathleen – loved your post! We appreciate the idea that going global does not mean just bringing the exact same look to a different country. Brands like Bloomingdale’s that opened in Dubai had the right idea to incorporate regional influences! http://www.archsystems.com/projects.aspx?cid=4370&mid=4400&id=19220
Interesting read and documentation. Its on both my spouse and my bucket list to do just that. Interestingly enough you just elevated the number. We'll be sure to wear football pads and helmet.
I appreciate you sharing this.
08.25.2011 | Unregistered CommenterErrol Pierre

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