Westfield owner focuses on ad sales at Europe shopping malls

Westfield owner focuses on ad sales at Europe shopping malls

Unibail-Rodamco-Westfield: Monetizing Shopper Traffic through Advertising

The world of shopping malls is changing, and Unibail-Rodamco-Westfield (URW) is at the forefront of this transformation. As the owner of Westfield malls, URW is exploring innovative ways to generate revenue by capitalizing on shopper traffic. One of these strategies involves charging brands for featuring their advertisements on screens and in pop-up spaces within its malls, thereby creating a new stream of income.

URW’s decision to leverage its physical space for advertising is a proactive response to the evolving retail landscape. The company is adapting to the changing preferences of consumers as online shopping gains popularity. By reimaging its malls as advertising platforms, URW aims to maximize revenues per square foot while simultaneously streamlining its portfolio.

Operating 78 shopping centers across 12 countries, URW launched Westfield Rise, its in-house retail media agency for Europe, last year. This strategic move allowed URW to consolidate its advertising offerings under one banner, providing a standardized and cohesive platform for brands. The establishment of Westfield Rise has proven to be a success, contributing 19.6 million euros in net margin for URW in the first half of this year alone, an increase of 14% compared to the same period in 2022.

URW has set ambitious targets for Westfield Rise, aiming to achieve 75 million euros in net margin by the end of 2024 and 200 million euros by 2030. With Westfield Rise operating as a dedicated media agency, URW anticipates exponential growth in advertising revenue, buoyed by the increasing demand from brands seeking to engage with consumers in unique and creative ways.

The potential of the retail media market cannot be understated. Citi analysts predict that it will grow from an estimated $65 billion in value today to a staggering $110 billion by 2027, excluding China. URW, recognizing this immense opportunity, has already positioned itself as a key player in this burgeoning market. With 1,700 digital billboards and 170 dedicated spaces across its shopping centers in Europe, URW offers brands the unique advantage of “physical” contact with consumers, a valuable asset in an increasingly digital world.

While online advertising has dominated the industry, recent developments in data privacy regulations are changing the game. As tighter controls on cookies—tracking codes used by advertisers to collect consumer information—come into play, brands are seeking alternative avenues to reach their target audience. URW’s Chairman Jean-Marie Tritant believes that this shift presents an exciting opportunity for malls to reclaim their role as an advertising powerhouse. Tritant states in an interview with Reuters, “In a context where brands and advertisers have been using a lot of social networks previously, … now that you have less cookies and this is somehow tougher, you see brands and advertisers trying to get to reach the consumer where they are.”

In addition to diversifying its revenue streams, URW is strategically adjusting its real estate portfolio. In the United States, URW has been disposing of shopping centers, including its Westfield mall in downtown San Francisco, as it anticipates a foreclosure in the troubled Tenderloin district. By cutting its footprint in the US, URW is aiming to reduce its exposure to the American market and prioritize its position as a pan-European pure play company.

Since 2021, URW has generated a remarkable 4.7 billion euros from real estate sales, with 3.3 billion euros coming from Europe and 1.4 billion from the US. This strategic shift enables URW to refocus its resources and capitalize on the robust and dynamic European market. Tritant emphasizes the importance of this consolidation, stating, “The idea is really to reduce our exposure to the US and to be a pan-European pure play.”

Unibail-Rodamco-Westfield’s innovative approach to advertising demonstrates its commitment to adapt and thrive in an ever-changing retail landscape. By transforming its malls into advertising platforms, URW is capitalizing on shopper traffic, maximizing revenues, and positioning itself as a frontrunner in the evolving retail media market. With its ambitious targets and strong focus on Europe, URW is poised to reshape the industry and set the standard for advertising within shopping centers.

Earnest and Nova Credit partner for interna...
Turkey’s new central bank chief advoc...
Homebuyers prepare for higher interest rates
Euro’s strong performance uncertain d...
4 ways Black women can counteract pay inequ...
Moscow gains control over assets of Western...
Business

Business