This evolution was the focal point of a breakfast roundtable hosted by Brookfield Properties in London earlier this year. As a leading global developer and operator of high-quality real estate assets, Brookfield Properties is at the forefront of navigating these changes in real estate development.
The event brought together industry leaders to explore the next frontier in retail’s renaissance, using The Playce at Potsdamer Platz in Berlin as a case study. Since taking over the management of Potsdamer Platz in 2016 on behalf of Brookfield Asset Management, Brookfield Properties has invested over €200 million in renovations to transform The Playce into a premier retail destination.
The discussion featured insights from renowned reporters in the retail and property sectors, creative consultant and trends forecaster Katie Baron, and retail consultant Jonathan Doughty. Additionally, leaders of two innovative brands that recently opened their first European locations at The Playce – Simon Potts, CEO of the creative cocktail bar and restaurant The Alchemist, and Tim Wilks, CEO and Founder of the nextgen games venue Lane7 – contributed to the conversation.
Through these discussions, the variables of a new retail equation emerged: tapping into the joy economy, providing physical spaces for online communities, elevating local heroes, and creating spaces for families.
TAPPING INTO THE JOY ECONOMY
The concept of the joy economy revolves around creating experiences that evoke happiness, transforming retail from a transactional space into an enjoyable destination. Successfully achieving that requires a shift in perspective from designing for the third person to a more personal view of the customer’s experience. Katie Baron refers to the emerging “hopecore” trend, which reflects a gravitation toward positive channels for connectivity and joy amidst modern-day challenges and tribulations.
Retailers need to dream and build experiences that evoke emotional responses. Those who can combine digital and physical engagement to bring happiness will find even further success. This is supported by a Deloitte report stating that 80% of consumers are more likely to choose brands that provide personalized experiences and emotional connection. Recent research by Wunderman Thompson also found that consumers are demanding immersive sensorial experiences – 63% seek brands that can provide multisensory moments, and 61% long for brands that can ignite intense emotions.
Brookfield Properties invests in curating the retail mix at its venues, ensuring fun and engagement for all customer segments – from toddlers and families to teenagers and young adults. The Playce at Potsdamer Platz is a masterclass in how to achieve this.
Next to Manifesto Market – a hip hybrid food hub with two dozen 22 high-quality restaurants, you’ll find The Alchemist, a cocktail bar and restaurant which offers brunch and coffee by day, and an immersive cocktail experience that combines theatrical flair with mixology to create a party atmosphere for a fun night out. Walk a few meters and you’ll be at Lane7, which reimagines bowling as a vibrant social activity infused with entertainment, appealing to a younger crowd looking for novelty.
EL&N will soon open in The Playce, known for its Instagrammable interiors and delightful menu, perfect for families enjoying a leisurely brunch or friends catching up over coffee. Just outside The Playce, you’ll find NOTAGALLERY, a young art gallery which has made a name for itself by promoting contemporary art and emerging artists, catering to art enthusiasts on the frontline of culture.
These venues not only attract new customers but also foster loyalty by creating memorable experiences. Research by McKinsey highlights that experiential retail can lead to increased customer loyalty and higher spending. However, the impact of these joyful experiences extends beyond immediate sales; they cultivate a community atmosphere where customers feel connected to the space and each other.
PHYSICAL SPACE FOR ONLINE COMMUNITIES
To stay ahead of the curve, retailers must understand how digital influences the physical. As online communities continue to grow, there is an increasing demand for physical spaces where these digital interactions can manifest in real life. Brick-and-mortar stores should be seen as experience hubs, offering customers the chance to touch and feel products, and interact with brands and their communities in ways digital platforms can’t replicate.
Take the official NBA Store at The Playce, for example. It stands as the largest and most impressive store for basketball fans in Europe. This store offers merchandise and creates a gathering place for fans to connect over their shared passion for the sport. Alongside that, The Streets, specializing in basketball and streetwear, is set to open soon, creating a physical hub for fans to come together and celebrate their interests – something that doesn’t currently exist anywhere else in the city.
Gamestate, an exciting addition at The Playce, brings a modern arcade experience with a variety of games and entertainment options. It caters to both casual gamers and dedicated enthusiasts, providing a vibrant social space where online gaming communities can meet and compete in person. Adding to that dynamic mix, Mattel is set to open its first European store at The Playce, offering a unique space where fans of all ages can engage with their favorite characters. Beyond its product shelves, the space will also be host to interactive events and activities, further bridging the gap between digital and physical experiences.
Servicing fan collectives is big brand business, and engaging youth culture is critical in this context. Speaking in London, Doughty emphasized the importance of “banishing boredom” by offering fresh experiences that resonate with younger audiences who crave novelty and excitement. While selling to music, TV, and film fans isn’t new, there is huge potential in ingenious spinoffs that fill key gaps and feed devotion. The rolling reinvention of Potsdamer Platz reflects an understanding of these dynamics – curating spaces that foster social connections while addressing issues like loneliness and disconnection prevalent among today’s youth.
ELEVATING LOCAL HEROES
Local brands are the heartbeat of any community, and the success of a place relies on how it supports these local heroes. Although the appeal of globally recognized brands is clear, local homegrown businesses can have a massive impact on a retail destination. While Potsdamer Platz is a location that strives to introduce new brands and concepts to the city of Berlin, it’s also a place where Berliners can find stores they know and love, that are synonymous with the city.
Brookfield Properties always strives to elevate homegrown talent. At The Playce, Brookfield Properties has provided beloved local establishments such as Burgermeister and Brammibal’s Donuts with prominent spaces within the development. That not only enriches the retail mix but also strengthens community ties. For example, Caffè e Gelato, synonymous with Potsdamer Platz since 1998, has seen a significant increase in foot traffic following its strategic relocation to a more visible area. The move is mutually beneficial: It ensures local favorites continue to thrive with increased foot traffic, but also fosters a sense of pride among residents who see their favorite local brands represented prominently.
Doughty emphasized the importance of local identity and authenticity in engaging Berliners. Fostering emotional connections with local brands and ensuring they have a platform to grow alongside global names like Five Guys enhances the retail experience and reinforces the cultural fabric of the communities that frequent The Playce.
CREATING SPACE FOR FAMILIES
In a young and growing city like Berlin, creating family-friendly spaces that are both fun and safe is essential for attracting a more diverse demographic. Research shows that family-oriented environments can significantly increase dwell time in retail settings. By creating environments where families can enjoy quality time together – such as through public art installations and new pedestrianized avenues – Brookfield enhances community engagement and satisfaction. These spaces serve as gathering points for families to connect with each other while also engaging with retail offerings in a relaxed setting.
The Playce has also introduced attractions like The Upside Down Museum, which provides unique experiences that appeal to both children and adults, fostering family bonding through interactive art installations. Additionally, The Playce hosts a variety of cultural programmes throughout the year, including workshops, performances, and seasonal events that cater to all ages. One of the highlights is the Kids Noon Year’s Party , a festive event that brings families together to celebrate New Years Eve with an official countdown and balloon drop at noon.
SUSTAINABILITY AND INNOVATION
Underpinning the new retail equation is the imperative for sustainability. Today’s consumers demand that retailers embody a sense of social purpose, a “raison d’être” that goes beyond profit. Research underscores this shift, revealing that purpose-driven organizations grow at more than twice the rate of their counterparts. Customers increasingly expect businesses to step up and demonstrate responsibility towards society and the community.
At The Playce, the Peek & Cloppenburg Conscious Fashion Store is a physical manifestation of that imperative. As one of the largest sustainable department stores globally, it sets a new standard for ethical fashion in Europe. This initiative is part of a broader transformation in retail, redefining its function, the value it delivers to customers, and the ethics and sustainability of its operations.
This is all laddering up to a bigger change in retail; the function it performs; the value it delivers to customers; the ethics and sustainability of how it operates; and the broader role it plays in the communities it serves. Retailers must now look ahead and articulate its purpose within this context of change.
THE RECIPE
Brookfield Properties’ innovative approach to the new retail equation exemplifies how businesses can survive and thrive in a fast-changing world by prioritizing customer experience, community engagement, and sustainability. As we look toward the future, the new retail equation will be defined by those who can seamlessly blend joy, community, and purpose.
