Shanghai Shopping. (China Research)

By Desvaux, Georges; Li, Guangyu et al. | The McKinsey Quarterly, Spring 2002 | Go to article overview

Shanghai Shopping. (China Research)


Desvaux, Georges, Li, Guangyu, Fenhirin, Jacques, The McKinsey Quarterly


Shanghai wants to know the secret of becoming a world-class shopping and tourist destination. A booming economic and trade center, the city is now trying to transform its Nanjing Road into one of the world's leading retail and entertainment districts. But although the street is China's best-known and most successful commercial thoroughfare, Shanghai local-government officials and businesspeople think it is far from realizing its potential, particularly in a city undergoing spectacular modernization in hopes of rivaling Hong Kong and Tokyo.

In order to understand how to turn a national shopping area into an upscale international one, local and regional officials last year reviewed the qualities shared by the world's leading retail districts-in particular, Carnaby Street and Oxford Street, in London; the Champs-Elysees, in Paris; the Via Montenapoleone, in Milan; Las Ramblas, in Barcelona; Michigan Avenue, in Chicago; Times Square, in New York; the Marina, in Singapore; and the Ginza, in Tokyo. (1)

To be counted as world-class, a district had to have a worldwide reputation, a high traffic volume, and strong revenues. The nine also had in common an interesting history, distinctive architecture and business formats, and a strong mixture of retailing, places to eat and drink, lodging, entertainment, and culture. Further shared attributes were exciting and innovative anchor-store tenants, a convenient public infrastructure, a pleasant environment, and strong public-private partnerships (Exhibit 1, on the next page). Four districts in the study were of particular relevance to Shanghai: the Champs-Elysees has itself passed through a restructuring in recent years; Michigan Avenue has made a determined effort to improve its economic foundation; Oxford Street has chosen a mass-market focus; and the Ginza is the most famous large retail district in the whole continent of Asia.

Compared with these, Nanjing Road came out poorly (Exhibit 2.) Although renowned domestically--it attracts world-class foot traffic of one million shoppers on weekdays and two million on weekends--99 percent of its visitors are local residents or domestic tourists; few non-Chinese people have heard of the place. And while its annual sales do come to some $1 billion, this is only about half of the $3 billion that the top commercial streets generate; moreover, an average visitor to Nanjing Road spends less than 30 percent of what visitors to them spend. Many elegant buildings from the first three decades of the 20th century are covered with neon signs and billboards, denying the street any architectural distinctiveness. The Champs-Elysees, the Ginza, Michigan Avenue, and Oxford Street, by contrast, all have architecture of interest to visitors.

Retailing dominates on Nanjing Road, with the three biggest department stores--including Number One Department Store, the largest in China--accounting for two-thirds of its revenue. The street experience, while upbeat, can be uncomfortable, offering few relaxing places to sit or eat and very limited green space. There is also a dearth of entertainment and cultural venues. The Champs-Elysees is a cocktail of trendy retail shops, restaurants, cafes, and movie houses, and the Ginza is a leading art center as well as a place for shopping. By contrast, Nanjing Road gives shoppers no incentive to linger. The local merchandise, displays, and marketing campaigns are lackluster. Tenants are mostly state-owned enterprises with aging business formats out of sync with current trends and global styles; for example, the street has no giant retailers specializing in electronics, an extremely popular format around the world.

Among other ideas, the Shanghai study suggested that the city should ensure that commercial attractions in the street are distinctive. On the Champs-Elysees, for instance, the visitor can find the world's first Louis Vuitton megastore, the largest Gap store in all of Continental Europe, and Sephora, the world's largest perfumery. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Shanghai Shopping. (China Research)
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.