A glass of fermented mare’s milk and some horse stew anybody? The former is about 7% ABV and the latter chewy but, hey, who cares, this is Almaty, the shining commercial light of central Asia.
Almaty used to be the capital of Kazakhstan, but ceded that title to new-build Astana, more than 600 miles away, in 1997. Yet it remains the commercial hub of a truly massive country (London to Almaty takes around eight hours, of which roughly half is spent flying across Kazakhstan) and its retail proposition is changing fast.
There is something of a Klondike-style rush taking place among European retailers as brands scramble to establish a foothold in an economy which, boosted by oil revenues, has growth of the kind that western European democracies dream of. And, for proof, look no further than the Esentai Mall, a shopping centre that opened in October and which is the (financial) handiwork of Turkish/Kazakhstani developer Capital Partners.
This is not the biggest mall you’ll encounter, neither does it have all the brands you might care to mention. What sets the three-level, 96,875 sq ft shopper’s delight apart, however, is the fact it is aimed at well-heeled shoppers. When names such as Gucci, Louis Vuitton, Breitling and Lanvin sashay into town, there’s clearly money around.
This might appear somewhat counter-intuitive. A perhaps natural reaction on the part of a ‘developing’ economy would be to imagine that mid-market operations would be the pioneers with others following in their wake. But the mid-market of the West is, to an extent, already here. Visit the Mega Center, a less recent shopping scheme, and you can shop Gap, Topshop and Cortefiel, among others. You can even order a skinny latte from a Costa Coffee outpost. The mid-market is therefore in place and Esentai is the next stage on. It is the statement made by this new mall that really raises eyebrows.
However, it’s been done, and you have to imagine that more than a few easy-term leases have probably been involved, this is impressive. At the opening night launch party, ostentatious wealth was on display and if you weren’t wearing at least some of the products from the luxury retailers that have taken space, then you probably didn’t matter.
Something for everyone
Yet interestingly, there is more to this mall than bling. The scheme’s anchor is Saks Fifth Avenue and it is perhaps a measure of the attractions of this new frontier that this is the retailer’s first foray into the region – you’d have to travel to Dubai to find another. Walk into this store and it’s like being in the US, with the exception that the product choice is the outcome of recruiting local buyers – although in fairness, it would be possible not to notice.
Now couple this with smaller and more readily familiar European names such as Oasis, Mango, Puma and Ecco, and it becomes apparent that while this mall might be ostensibly glamourous and luxurious, it is more democratic in its approach than might initially be imagined.
The catering provision serves to show how things really are. For those in need of something quick and cheap, there is, at the back of the centre and removed from the luxury brands, a Burger King. If the requirement, however, is more upscale, the curiously named Champagne Bar Bizzarro will do the trick.
Is Esentai in particular and Almaty in general therefore all about the money? Edouard Faure, country manager for Louis Vuitton in Russia and the CIS, comments: “We have had very good success already with Kazakh customers purchasing in our stores all over the world, and thus, looking to the development of the city of Almaty, we felt it was time to enter directly in the market with a Louis Vuitton store.”
Having realised this ambition, the question for Louis Vuitton and brands of its ilk is where next? Developments of this kind take a long time to bring to fruition and Esentai started back in 2007 and then stalled as Lehman Brothers did its thing to the world’s economy in 2008. Almaty is certainly on its own, geographically and in terms of affluence in central Asia. Kazakhstan’s immediate neighbours, Kyrgyzstan and Uzbekistan, have nowhere that comes close to measuring up. Nonetheless, growth across this part of the world outstrips anything likely to be encountered closer to home and it’s easy to understand why retailers are weighing up the options as far as more store openings are concerned. On balance, the logistics of operating a long way from home may appear formidable, but the potential rewards are also there.
Almaty used to be a stop along the northern part of the ‘Silk Road’ and it seems probable, local tensions notwithstanding, that this could once more be a route along which trade and retail flourishes. This is country and a city about which the great majority in Europe know almost nothing, but from a retail perspective it merits close scrutiny.
Meanwhile, those already up and running look well placed to thrive in the Esentai Mall, although woe betide anyone who mentions the ‘Borat’ word. Rich or poor this is one term that is still likely to see doors being firmly, but politely, closed, irrespective of how deep your pockets might be.
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