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Sharing Experiences on a Global Scale

Image courtesy of Nicolas Salto

Editor’s note: This blog post is part of the GenslerOn Rio 2016 blog series.

As Brazil hosts the 2016 Summer Olympic Games this month and the spotlight is on the country’s economic and cultural landscape, people across the globe are wondering: what’s next for Brazil?

It’s a positive moment for Rio de Janeiro and for the rest of Brazil. The mood in the city has been joyous and alive, in a much needed national break from political turmoil, demonstrations and the Zika virus scare, there is much to celebrate—a patriotic spirit that is alive amid the uncertainty and a thriving creative culture that was prominently displayed by the opening ceremony directed by Brazil’s Fernando Merirelles, best known as the director of the 2002 film “City of God.”

I was fortunate enough to spend last weekend in Rio and was blown away. Not just by the sincere welcome of the Cariocas and the undeniable beauty of the venues that were scattered about the city, but by the organization and assistance that was readily available from some 70,000 Olympic volunteers. The energy and enthusiasm of the visitors from all corners of the globe was electric and for a city that knows how to throw a party, this was probably the best party of a lifetime. Despite all the world’s worries, Brazil showed the world that is was more than ready to make history as the first South American country to host the Olympic Games.

Image Courtesy of Maureen Boyer

The context

The Brazilian economy has slumped greatly in the past few years. It seems clear that the recession (representing a 3-4 percent shrinkage in the Brazilian economy) will continue in the short term. Most economists agree that things are finally starting to turn around, but true signs of recovery will not begin to be felt until sometime during 2017. Consumer confidence in the economy is down, but because Brazil has such a huge emerging middle class, consumer spending overall is still increasing, albeit slightly.

Consumers are more concerned and more careful, but they are still making purchases. I walk out on the street and the restaurants and cafes are still full, and it is still hard to get a table not just at the popular restaurants with great prices, delicious salty snacks and icy cold beer, but at high-end restaurants as well. Life goes on, and people are still out, celebrating with friends and families—those basic things people are not willing to sacrifice. Brazilians love to shop. They like street retail and there is a marvelous tradition of weekday and Saturday open-air markets, as well as entire well-established urban shopping districts catering to all levels of income and taste. And lest you forget, there is a huge appetite and a full on love affair with shopping centers—it’s part of life here. For Brazilians, the draw of shopping centers is a contained, day-long experience for the whole family. In addition to security and high-end public amenities, many stores have adopted interest-free payment plans that make larger purchases more accessible to the emerging middle class consumer. But increasingly, bargain hunters want both the authenticity of the urban market and the curated and secure atmosphere of the shopping center. So in Rio, as well as other second- and third-tier Brazilian cities, we are seeing a great balance of street retail and shopping centers—and, increasingly, projects that fuse the best aspects of both. Malls, or as Brazilians call them, “Shoppings,” are bringing the activity of shopping, rather than the transaction, to the forefront.

Image Courtesy of Everton Ferreira

Sharing life, the Carioca way

While Brazilians are scrimping and saving everywhere, the Olympic games bring the residents of Rio de Janeiro, commonly known as Cariocas, a welcome opportunity: tourism. Despite years of ramped-up hotel building leading up to the 2016 games, Rio’s hospitality market, especially at the middle range, remains underdeveloped. In direct response to this international influx, the city of Rio now boasts 400,000 Airbnb listings, some in traditionally pricey neighborhoods like Leblon and Copacabana, and others extending into the poorer neighborhoods of Rio’s favelas. With an estimated 350,000 to 500,000 tourists in Rio this month, citizens are happy to bring global wanderers into their homes to bring in additional income, about $25M of economic gain, according to Airbnb. While Rio was already one of Airbnb’s largest markets, it is currently also its most expensive. With tourists, both international and local alike, many with limited budgets, seeking authentic urban experiences, the boost in available lodgings is a welcome surprise. Similar to the trends we see in shopping habits, tourists seek life experiences that are seamlessly integrated to the urban fabric. For some, that means a bit of personal Carioca hospitality; the city is full of friendly, smiling faces. Tech solutions, like design solutions, are catering to a greater desire for a lifestyle with less boundaries, more organization and simpler transactions.

Image Courtesy of Maureen Boyer

Opportunities for resilience

And this appetite for seeking the highest value from any experience plays out, the enthusiastic appetite for experience, particularly among younger generations is a global trend that we happily witness everywhere. From San Francisco, to Singapore to São Paulo, young consumers’ emphasis on experience is in many cases much stronger than it is for ownership. So, while the luxury market has cooled, for a growing group of consumers the desire to connect to and to share an experience remains—it’s part of what they are looking for when they go shopping. And even as e-commerce starts to boom in Brazil, brick and mortar space remains a hot commodity, drawing traffic in the form of entire families and groups of friends in ways that websites and apps can’t.

Image Courtesy of Nicolas Salto

According to ICSC, Brazil is the second least-retailed country in Latin America, with 671 square-feet per hundred people. Despite the massive demand for more and new kinds of retail space, only eight new malls were built in 2015, and this year even fewer are expected to come on board. However, those that are being built represent a new focus on retail space that resonates with people’s changing values and lifestyles both here in Brazil. Changing consumer priorities have pushed big retail developers to look more finely at what they are offering and to make sure they are using every bit of their existing space in order to provide the mix of that shoppers are looking for and most enjoy. There is a greater emphasis on paying attention to their visitors’ entire journeys, which includes their needs even when they are not shopping. More than ever, developers are considering how they understand, connect to, and support their community. Even if they don’t have the funds to undergo a complete renovation, a lot of them are upgrading the amenity spaces—baby-changing stations, kids areas, lounges—to give people more room to socialize and enjoy a mix of activities and moods.

This is important in a downturned climate where people are seeking alternative spaces, especially in a culture where the shared social experience is so central to life. This new focus gets to the intangibles of retail, of how you create spaces that enhance the human experience and bring people together. With all the world’s cultures represented at the Olympics this month, togetherness seems to be a theme for life in Rio, an opportunity for growth and a strategy for maximizing the value of the spaces in which we live, work and play.

Image Courtesy of Everton Ferreria

Maureen Boyer is a leader of Gensler’s global Retail Centers Practice and Office Director for the firm’s São Paulo office. With more than 25 years of experience in design, project management and construction management, she focuses on reinventing and redeveloping retail environments, with a balanced emphasis between architecture and interior design. Through her continuous research of ever-changing consumer behavior and shopping trends, Maureen executes a uniquely customized, integrated multi-channel solution for her clients, including Carrefour, Havaianas, Westfield, and Club Med, and their customers. Contact her at maureen_boyer@gensler.com.