This morning, at a press conference held at the Swatch Lab in downtown Zürich, high-end luxury watch brand, Omega, announced that it will open a high-concept branding environment at Zürich Airport’s new trading and lifestyle complex ‘The Circle’. TRBusiness reports from Zürich.

 

The conference saw Stephen Urquhart, President and CEO of Omega, join; Nick Hayek, CEO Swatch Group; Zürich Airport’s Patrick Graf, Vice President Commercial and the airport’s CEO, Thomas Kern.

 

Although the conference was delivered in German – the exception being Urquhart’s presentation, which was made in English – what was crystal clear, irrespective of the language barrier, was that each stakeholder; the Swatch Group, Omega and Flughafen Zürich AG are all passionately committed to the success of The Circle project, which is worth CHF1bn (almost US$1.1bn).

 

TRBusiness Editorial Director, Doug Newhouse, first spoke to Graf about The Circle concept, in an exclusive interview which featured in last year’s June issue.

 

 

From left: Stephen Urquhart, President and CEO of Omega; Nick Hayek, CEO Swatch Group; Zürich Airport’s CEO, Thomas Kern and Zürich Airport’s Patrick Graf, Vice President Commercial.

 

‘FANTASTIC PLATFORM’ FOR BRANDS

Urquhart described the opportunity as a “fantastic platform” and enterprise for a brand “to communicate its current status to the world”. He told journalists that The Circle will give visitors the chance to enter ‘the full realm’ of individual brand universes.

 

Omega – which is the first retail tenant to publicly confirm its agreement with the airport – has secured just one of 25 units on offer to brands/companies [at this stage Flughafen Zürich AG is reluctant to reveal who else they may be in negotiation with]. TRBusiness understands that the units measure up to 800sq m each and the tenants’ fees/rent agreements will be similar to those at Zürich Airport; somewhere between landside and airside.

 

The complex is described as an ‘international trading centre’; more relaxed than a conventional shopping centre, yet more cosmopolitan and ‘atmospheric’ than an “average airport.”

 

 

An artist’s rendering of the new Omega unit to open at The Circle.

 

Although there will be opportunities to make purchases at the branded standalone units – such as the one, which has just been snapped up by Omega – the emphasis is not on pure retail and rather on creating brand atmospheres. Hayek even made the comment [in German] that the emphasis is not on selling watches and in fact it may choose not to make them available for purchase at all. [It was later confirmed that the unit will actually sell products].

 

The Swatch Group Lab.

 

‘A DESTINATION IN ITSELF’

The Circle, which will be majority owned by Flughafen Zürich AG (51%) and co-owned by Swiss Life AG (49%), will be ‘a destination in itself’ at Zürich airport. “Just steps away from the terminal buildings, the new, architecturally striking complex will buzz with life and services,” says Flughafen Zürich AG.

 

“With all the bustle of an international trading centre, it will, from 2018 become a focal point for business and lifestyle.”

 

Covering 180,000 square metres, The Circle will include two Hyatt hotels and a Convention Centre; top international brands; a medical centre and ‘state-of-the-art’ office space. There will also be plethora of other attractions, from art and culture to food and entertainment, as well as ‘knowledge related activities and opportunities for learning’.

 

Left: Patrick Graf, Vice President, Commercial, Zürich Airport.

 

The complex will be divided into seven ‘modules’ consisting of: Brands & Dialogue; Hotels & Convention; Headquarters & Offices; Health & Beauty; Education & Knowledge; Culture & Events and finally, Counsel & Arts.

 

DRIVING UP NON-AERONAUTICAL REVENUE

Graf [pictured left] told TRBusiness that, once completed, The Circle will drive up non-aeronautical revenue, increasing its share of the group’s total revenue. As reported by TRBusiness.com, rising spend per passenger at Flughafen Zürich pushed up non-aviation revenue last year which the airport said “confirms that the decision to optimise the existing retail portfolio and to expand the sales area and other passenger services was correct”.

 

Last year, average spend per departing passenger rose to CHF 43.20 ($49) from CHF 41.70 in 2012, almost within touching distance of its highest recorded level of CHF 43.50 in 2008 (before the global financial crisis). Spend per head has been rising sharply since 2011 when it was CHF 39.40.

 

As mentioned The Circle’s total ‘useable area’ totals 180,000sq m, with a footprint of 37,000sq m. The Brands & Dialogue module – which sees Omega taking up resident as The Circle’s first confirmed retail tenant – will provide companies and brands with a unique showcasing opportunity, ‘facilitating dialogue between companies, their customers and partners’ – what the airport describes as ‘Circleness’.

 

Bird’s eye view of the new complex to open in 2018.

 

The airport believes this will allow for the acceleration of change in buying patterns and consumer behaviour following advances in communication technology. It says that there are now “rising demands to reach consumers” which has put ever greater emphasis on concepts like “brand experience” and “brand heritage”.

 

All entrances to the Brands & Dialogue areas will be accessible by lanes and squares on the main level, encouraging maximum footfall to the busiest zone of the complex. According to the airport, vertically designed units – called brand houses – will have the option to extend upwards over several floors.

 

Thomas Hern told TRBusiness that this will allow companies flexibility to distinguish between their retail, display, meeting and office areas and other functions. He also said that tenants will be free to choose how many floors they require.