Shopping experiences have changed a lot over the last decade. In fact, it was just that that Atul Ruia had in mind when he opened Palladium, the luxury and premium brands mall at Phoenix Mills in 2009. Of course, there were the naysayers, who were not sure how a mall with luxury brands would do in a mixed retail format that Phoenix High Street was at the time. So when Palladium came up, it was different from the other retail developments at the time. “It just has Atul’s and mine DNA in it,” says Gayatri Ruia, director, Phoenix Mills. “I think that difference also comes because it’s so unique,” she adds. Palladium is one of those things that Atul and Gayatri Ruia created and conceptualised. There were no rights or wrongs, it was something they believed in and did with their passion, and it continues to be that. “I think some of the naysayers were right, some were wrong, but it was tough and there has been a great learning process,” says Gayatri.
The attention has moved to the next phase of retail development, which should start materialising over the next three years. Spread over 14 acres, Mumbai’s High Street Phoenix is one of the smaller malls in the Phoenix Mills portfolio. There are brands which the company can’t accommodate simply for the paucity of space. Hence, an extension will soon be underway which will see the offices make way for retail. “There are so many more brands that still need to come into India,” says Gayatri.
Today, Phoenix has eight malls pan-India, and plans are to roll out another five. These malls will have to be malls of the future and serve for the next decade to come. While few will be called Palladium, the others will be a new avatar with a new brand name. However, all will have a luxury component in them. In fact, according to Gayatri, they will now shy away from the word `mall’; instead will call them `entertainment and retail lead consumption centres’. “We’re not defining it anywhere, but for our understanding what we are creating is an entertainment and retail lead consumption centre,” she says.
The Mumbai development began with the residential towers, Phoenix Towers, then came the office buildings, F&B, mall and entertainment. Every centre that the Ruias have built, has started with a large parcel of land, and then they have tried to include each component. Much has been learnt and unlearnt over the years. When Palladium was starting, the model in Gayatri’s mind was for it to be a space for both, luxury and premium brands. The ultra-luxury model had worked in a developed country. It had worked in China, which again is a very different market, with a very different consumer outlook. That was never going to happen in India. In fact, even DLF Emporio, the New Delhi based luxury fashion shopping destination, started doing better after they got other mainstream brands nearby, as that created a more wholesome destination to go to. That’s how it is going to be with Indians.
According to industry watchers, the way Atul (Ruia) and his team planned Palladium, is beautiful and inspiring. He had a grand vision for the erstwhile textile mill, Phoenix Mills, right from the beginning, as a harmonious blend of a high street and a mall, with great public spaces. According to Pranay Sinha, leading shopping centre professional and former MD, Star Shopping Centres Pvt. Ltd., “Through time, they have ensured, with their meticulous retail planning, a strategic tenant mix, parking integration, and evolving market positioning, that all levels of Palladium are well irrigated with shoppers. You just need to enter Palladium to see all brands present there (with great cross-level visibility), and doing well, no matter which level the brand may be on. Phoenix Mills is a unique way of telling the world, we are this South Mumbai, urban marketplace, large scale, enjoyable, and at par with the world’s best shopping destinations,” he says. “While large cities are easier for malls to succeed in, very few developments in large Indian cities have been able to come up to such beautiful “adaptive reuse” of old structures, and match the sheer elegance-with-energy, that Palladium today represents,” adds Sinha.
A new matrix came into being. This was the time when the retail matrix looked at footfalls coming in. Post-2009 footfalls mattered less and less. In fact, in a mall like Phoenix Lower Parel, it is not about footfalls. In a lot of the other Phoenix malls, footfalls are exciting. However, at the Phoenix Lower Parel, it is about curating the footfall, or reducing the footfall. The Ruias are more interested in car count – chauffeur driven cars, Uber, or self-driven cars, valet. “I think the learning that has come from Palladium has been immense, because before we embarked on creating a luxury mall, there was a lot of data and studies available, but the on ground reality was quite different for luxury retail or high-end luxury retail. So we had to create our own understanding as we went. There was nothing to guide, to formulate that existence,” she says.
New revenue models were introduced. Revenue share with retailers, having a minimum rent and a revenue share, constantly being in touch with retailers and going that extra mile to support a retailer if they felt that they were flagging or needed more visibility, sometimes correcting a rent or sometimes correcting the space they have. “We have now enough knowledge to pretty much guide them about. The relationships we have built have been good,” says Gayatri.
A thorough audit is done of whichever brands are brought to the mall. As the customer wants to see something new that they have not experienced before, Palladium boasts a mix of old and new brands. When the value is seen in a certain brand, even if it is not known, which also the company realises is important, hence, you will find one or two brands which may be a surprise element. Very often there is a relationship that can be leveraged because it is across 8-10 malls.
Palladium has been growing consistently. There has been no time to pause and think. According to Gayatri, in hindsight, “letting go of the Shangri-La brand and operating the property as Palladium Hotel for a few years, was a huge challenge, which I think we overcame positively. I think we took the right decisions when we did,” she says.
The Ruias are trying to create an urban community centre – a place where you don’t have to go just because you want to shop. Gayatri wants it to be a place where you might buy something, because you are there. It is important to understand that, unfortunately, this is the only mall of its kind in Mumbai. So where is the space for luxury to grow, where is the space for people to have more luxury experiences? In order for the brands to grow and develop, a larger footprint is required. So over time, if a competing mall came up, though it may directly impact Phoenix for a short amount of time, in the longer term, it would only grow everyone’s business.