Zheng Zhigang: Pushing Ahead With K11 Expansion Plan

In 2010, Zheng Zhigang threw 400 million yuan to the New World Tower in Huaihai Road, Shanghai, and changed it to K11 Art Mall.

The shopping center with an area of only 38 thousand square meters has created a record of 1 million people in a single month and has become a gathering place for the tide people in Shanghai.

Perhaps even he himself did not think that K11 has overturned the commercial real estate shopping center homogeneity fortress, has become the commercial real estate industry internal dispute visits the object of investigation.

When the K11 brand was founded, the third generation of Hongkong new world family leaders were still under 35 years old.

Zheng Zhigang, the third generation leader of Hongkong new world family

Zheng Zhigang, founder of K11

In 2014, the first exhibition of Claude Monet, known as "the father of impressionism", was located in Shanghai, where the exhibition was not an art gallery, but in the K11 shopping center of Huaihailu Road business district in Shanghai.

This is related to Zheng Zhigang, who has an art loving boss.

Zheng Zhigang is the third generation of Hongkong new world family and the fourth generation of Zhou Dafu family.

In the Forbes rich list of Hongkong, the Zheng family has always been among the best. In the March 2013 billionaires list of the world, it ranked 44 in net assets of 160 billion.

Compared with his father's Zheng Jiachun, Zheng Zhigang is more like his grandfather, Zheng Yutong, who is called shark Tong Tong, who likes to start his own business. K11 is his masterpiece.

In early 2008, Zheng Zhigang led a survey of new world department store VIP customers. He found that many people were complaining about the high convergence of shopping centers. The new generation of VIP paid more attention to the sense of space and spirit.

Zheng Zhigang likes art, and he thinks he can combine art centers with shopping centers.

He told his father about his idea and received a HK $3 billion injection.

And named the art shopping center K11.

K means Kingdom (Jiang Tu), and the 11 is K's placement in the alphabet.

In December 2009, when K11 opened in Tsim Sha Tsui, Hongkong, 80% of merchants were the first to visit Hongkong.

K11 achieved profitability in the first year of the opening industry, and its income was 3 times higher than that before the rectification.

In this shopping mall, thirteen sets of art worth HK $20 million have been displayed for a long time, all from Zheng Zhigang's collection.

In Zheng Zhigang's eyes, K11 is not a shopping mall in the ordinary sense, because there are many things people can do besides shopping.

For example, you can go directly to the three floor of the art space to enjoy a contemporary art exhibition.

Go to the two floor ABC Cooking to learn baking.

In the last sketch class or pottery lesson, occasionally I could meet the interesting decorations sold in the creative market.

On the upstairs floor, you can meet the band's performance, though this band may not be known.

If you go to the restaurant on the four floor, you can also play a table football.

The director of Monet Museum, Paris, first used the term "contemporary space" to describe K11 when he first saw it.

In retrospect, K11 was born in doubt and satire.

In the commercial center, a museum of 3000 square meters is considered by many to be a ticket for rich children. It is considered to be a commercial speculation by art, but Zheng Zhigang has hardly appeared in any media.

"When I started doing this, many people criticized me. Many people said I was crazy.

Do they ask me to understand art? Do they understand business? I don't explain it because my personality is like this.

I ignore you, because I know what I want and what my vision is. "

K11 has become one of the most expensive rental properties on Huaihai Road.

"One layer of K11 is not its profit point. This layer is luxury goods, with the main points of deduction, only a dozen or so of the bottom part, but the one or two level of the underground is its main profit point, which can reach more than thirty or forty yuan.

To a large extent, it is driven by the three floors of the underground and the mass flow of the subway.

The brand distribution of each layer also concealed the University's question.

In the case of three cafes, which are distributed on the two floor, the ground floor and the two floor of the ground floor, K11 spent a lot of time studying the consumers on each floor.

The two floors of the ground are connected with the subway station, the crowd is relatively young and the purchasing power is weak. This is a chain store brand named Costa, while the underground one floor is a gathering place for the tide people. They are often interested in new and interesting things. The price of the floor consumption is slightly raised. The catering brand Baker&Spice of Wagas is more suitable for this place. The two floor is connected with luxury goods. It represents more high-end consumption habits. The people who buy luxury goods often choose to drink a cup of afternoon tea here. Even though the price of the COVA restaurant in Italy is high, consumers do not mind.

Since June 2009,

After announcing that the investment is not more than 100 million yuan, after the image renovation of 33 new world department store chains owned or operated by Zheng Zhigang, K11 began to push forward the construction of the "K11" brand in mainland China, and is expected to invest 1 billion US dollars in the next 7-10 years to build nearly 100 million square meters of business space.

Three years ago, K11 was just a combination of empty letters and numbers.

Zheng Zhigang is trying to fill the content of K11.

"Domestic business centers are too homogeneous."

Zheng Zhigang believes that in the near future, there will be a knockout.

Although K11 is sometimes regarded as a public service platform, even a lot of decorations of Wuhan K11 city commercial center are regarded as the improvement of real estate value.

But in Zheng Zhigang's view, this is not contradictory. Business can blend well with art.

Zheng Zhigang plans to invest 7 billion 800 million yuan in the next 5-7 years to set up 7 shopping centers with K11 as the brand in the mainland, and 7 shopping malls, with a total floor area of about 1 million square meters, distributed in Shanghai, Guangzhou, Wuhan, Chengdu, Beijing, Tianjin and Shenyang. The land will be allocated from 30 million square metres of land in the mainland.

As a holding property, future rental income will account for 30%-40% of all group owned property income.

The next project of K11 will be in Shenyang, with an area of up to 250 thousand to 260 thousand square meters.

Today, shopping centers have been built and investment is being conducted.

The highlight is a more than 10000 square meter Art Plaza and shopping malls with different theme zoning.

The biggest difficulty of the project is that the art shopping centers are mostly small and sophisticated, and this project should be large and complete, so it is necessary to divide the themes in the form of partition.

The cost of pre decoration and the cost of later operation will be very high.

Moreover, the artistic atmosphere of Shanghai K11 and Hongkong K11 is not necessarily suited to Shenyang's local consumption habits.

But K11 also shows that although shopping centers in every city have the same DNA, it is not a direct replication mode.

The first K11 shopping Art Center in mainland China -- Shanghai K11

Located in the golden area of Huaihailu Road, there are three floors to six floors on the ground, with an area of about 40000 square meters, and the surrounding facilities are mature.

With the core value of the three core elements of the brand "art, humanity and nature", Shanghai K11 will strive to create the largest interactive art park, the most stage shopping experience and the most diverse multicultural community. The 365 day uninterrupted interaction will open the creative journey of K11 to create an integrated and subtle interaction between art appreciation, humanistic experience, natural greening and shopping consumption.

From the point of view of the proportion of shops, Shanghai K11 has selected over 20 restaurants, including Italy, Japan, Thailand, Spain and the United States, some of which are the first to visit China.

What is worth noting is that compared with other high-end shopping centers in Shanghai, K11's brand portfolio has its unique positioning strategy. But for a project of about 40 thousand square meters, 5 international brands including DOLEC&GABBANA, MAX MARA and so on are refined and tasteful, and the combination of commercial brands and their artistic atmosphere is quite clear.

At the same time, for K11, a commercial body famous for its art, the theme image is very systematic.

Many people have summed up the success of K11 as a combination of art and commerce, which has achieved the difference of positioning. But the combination of art and commerce is easy to say, but behind it there are a lot of unknown difficulties. This is not a simple task, nor is it enough to display one or two works of art in a commercial project.

At this time, the importance of K11's artistic team has been highlighted. This can be said to be the biggest difference between K11 and other shopping centers in the operation structure. Many art installations are combined with projects, which are very harmonious in space and color.

Besides,

K11 does not introduce too many international brands on the basis of volume and positioning. It also shows confidence in its brand image.

A shopping centre with unique qualities does not necessarily rely on international brands to condense popularity.

The predecessor of Shanghai K11, Hong Kong New World building shopping plaza, is one of the landmarks of Huaihai middle road. After being pformed into K11, it has strengthened its public oriented business functions, including free Arts Center, new food art, Roof garden, large vertical greening and diversified brand stores. It also has a space of more than 3000 square meters. It has set up a perennial art space. Such a function is not available to ordinary shopping centers. From an operational point of view, a space capable of organizing various exhibitions can give play to the advantages of K11's artistic resources, and also make a shopping center's ability to do activities more powerful.

According to statistics, during the whole Monet exhibition, the number of people who bought tickets visited more than 400 thousand, while K11 sales grew by 20% during the same period.

Characteristic management is not a new topic. Every shopping center will do it, but its thinking is often not enough, so it is difficult to fit the real demands of consumers.

Friends who have been to Shanghai or K11 in Hongkong should be impressed with the "happy farm" and the "urban farm" there.

K11's brilliant plan lies in precisely grasping the urbanites' longing for and longing for pastoral life, and creatively converting the original part of the rooftop garage to the "urban farm", which has grasped the emotional needs of customers through experience.

This form may be easily replicated by other shopping centers. In fact, some people soon do so, but the real core creativity is no way to copy.

In fact, K11 has quite a few more creative business models to magnify its characteristics, such as the lifestyle advocacy brand of K11Design Store.

The detailed operation management is the guarantee of the characteristic management, and the concrete ideas can be generated through the inter departmental cooperation.