Carlos Jereissati

“Mall” — a word cringe-worthy to many shopping-center developers, at least in the U.S. Not so to Carlos Jereissati Filho, president and chief executive officer of Brazil’s Iguatemi Empresa de Shopping Centers SA, who embraces the word.

Jereissati Filho joined his family’s mall business as an intern in 1997, finding “love at first sight,” and assumed his current position in 2005. He took the company public two years later, and has overseen rapid expansion. Today, Iguatemi runs 17 malls across Brazil, including four in São Paulo. Additional openings are planned for December in Tijucas in the Florianópolis metropolitan area, and next year, in Nova Limo, in the Belo Horizonte area. The name Iguatemi has become synonymous with luxury in Brazil, and the company has introduced numerous global brands into the country, an often arduous process in a highly protectionist environment. Yet shopping is only part of a business model built on an experiential approach before experiential shopping was a thing. At Iguatemi properties, customers can work out, take in a movie, enjoy fine dining and more, as well as shop.

The mall industry fuses multiple points of fascination for Jereissati Filho. “It’s about people, it’s about behavior, consumption, design, experience,” he said during a recent trip to New York. In a wide-ranging conversation, he talked about technology, tariffs, the opportunities and challenges of retail today, and, yes, Uber.

As for his refusal to shun the word “mall,” Jereissati Filho, said, “It’s not about the word, it’s what you do with the word.”

WWD: Tell me about “the beautiful coexistence” motto at JK Iguatemi.

Carlos Jereissati Filho: JK Iguatemi is a luxury mall in São Paulo. When we opened six years ago, we came up with the idea of “the beautiful coexistence.” We wanted to show that in this place, we wouldn’t have just one thing, shopping. It’s the concept of when one thing meets the other. So when art meets commerce, when high meets low. So we have from Van Cleef to Havaianas. When fast meets slow. So we have very fine-dining restaurants, but we need to have a small food court where, if you’re ready to go, you can [eat quickly]. We have art in the mall. People have many moments in their lives and you want to be prepared for all those different moments.

JK Iguatemi

Carlos Jereissati Filho aimed to have luxury shopping mall JK Iguatemi offer customers a wide-ranging experience.  Courtesy Photo

WWD: That phrase “beautiful coexistence” — what a great thought for the world today.

C.J.: I love the concept. In the beginning, it was “the beautiful contradiction.”

WWD: You changed it?

C.J.: That was the original idea. So you know what? “Contradiction” — let’s go for something that’s more inclusive, and it went to this “beautiful coexistence…” In times of change, big change like we’re feeling now because of technology, some people try to protect what they have. They are very scared about what is happening. Nobody knows exactly where we’re heading and how fast we’re moving, and there are so many voices. So it’s very confusing.

WWD: As a major retail developer, how do you use technology?

C.J.: How we are able to be successful in the mall industry is [directly linked] to how convenient we are to people and how we can put everything together. From the moment they wake up, they can go to the fitness center at one of our malls. By the time they go to sleep, they may have gone to a live theater [production] or an exhibition inside of one of our places. We have everything in one place, and people can really enjoy different moments at the same time. Nowadays, you have technology helping people shop online.…The challenge for us is how we can improve technology within the store. I call this the Uber-ization of the store. Because I always say that to shop is fun. The problem is to pay and to carry. So how can you get those spots that are not nice out of [physical retail] and just keep the good part? If you go into a store, you like a pair of sunglasses and you put it on your face and if you love it and then you put it in the bag and go out…

WWD: That’s called shoplifting.

C.J.: You used to call it shoplifting. When you leave an Uber, don’t you feel like, “I should have paid the guy. I’m running away?” The friction doesn’t exist anymore because technology is taking care of the part that was a problem.

Other technologies are being tested nowadays, and these things improve very quickly. For us, it’s all about enhancing the knowledge of the customer within the physical property and helping the experience within the store to be as fantastic as possible. Because people love to see beautiful things, they want to touch, they want to wear and they want to go away with that. They don’t want to wait in line or stay there for long in the boring part.

WWD: How far along are you in dealing with those issues, the paying and carrying?

C.J.: The payment system is improving quite fast with this Apple Pay thing. The carrying part is still [an issue]. But I see in São Paulo, there’s UberEats and other [services developing]. There’s a lot of focus on how to help the logistics. We are very near the moment that you will [say], “OK, I just bought this, take it from me, I don’t want to carry it now…” The moment those things start connecting, [minimizing] all this boring part, it will enhance the ability of the store to be more convenient to people, and stronger, as compared to shopping online…

The other thing is how to identify the customer. There’s a lot of technology being put in place [that provides] quality information about [the customer] and the things they need.  

WWD: Within a mall, the brands are in control of their own technology. How can you help those brands better their technology?

C.J.: That’s the challenge for us, but we are comfortably in contact with the brands and try to push them to add technology within the stores. Plus, we can create our own CRMs, in order to provide more information for the tenants, [to help] them be more effective in servicing their clients. So we have an ongoing conversation with our tenants about what they’re doing, the steps they’re taking, how they’re pushing these kinds of initiatives. That’s pretty much our role, as long as we’re creating a very exciting environment for people to come to.

WWD: Individual brands can develop their own e-commerce. For malls, success absolutely depends upon people continuing to embrace the physical experience. Is migration to e-commerce happening at the same rate in Brazil as in the U.S., and how do you battle it?

C.J.: Not the same rate because the United States is so efficient. In Brazil, we still have less efficiency. All those things are moving in the same direction, but at a slower pace. And half of our business is nonretail. It’s like taking Barneys or Bergdorf’s and putting it together with all the leisure activities, all the services, in the middle of the town. So if you want to go to a nice restaurant, you have like 10 different very good ones, so people come for this. They go for the supermarket; they go for the fitness center. Our place is a meeting point. But we are moving also in the direction of having our own platform of e-commerce, or a marketplace, because we have a strong brand for Brazil. People relate Iguatemi to quality retail, so we want to benefit from that.

WWD: About knowing your customer. How do you evaluate who your top clients are? I could be a top client of one brand but not another.

C.J.: More of the data belongs to the stores, but we have our loyalty program, with, like, 15,000 people. So we know this group. Then, we have connections with some of the most important brands in order to use this data to provide them with special services. And with online, we are creating other types of initiatives that will give us more knowledge about this clientele, apart from the loyalty program, apart from the data from the stores.

WWD: What is the perfect developer-mall-landlord-brand relationship? What do you want in relationships with your brands?

C.J.: Well, for them to sell a lot. It’s about creating a perfect match between where you’re located and the quality of the tenant mix, and to be able to cater to that equation. What is beautiful about this equation, it’s always evolving, it never ends.

 WWD: Who around the world is doing the mall experience well?

C.J.: I think the Asian market is doing quite well.…There are people in China, in Singapore, there’s a group in Seoul, in South Korea. And I think Westfield, especially in London and some in Sydney — they have a very relevant mall there.

WWD: Any others by name?

C.J.: North Park Center in Dallas, Omotesando Hills designed by Tadao Ando in Tokyo, Americana Manhasset in New York, The Landmark in Hong Kong.

WWD: How does your approach differ from that of typical U.S. mall development?

C.J.: The way the malls in the U.S. evolved — retail was so strong. Malls started in the Fifties in the U.S., [primarily] for the suburbs. Now, these guys are hurting more than us. Mainly it’s the location. We are in cities and dense areas so we have visitors for many reasons. That helps us to be competitive in this environment because people are coming, like I mentioned, for fitness, for lunch, for dinner, for many different reasons, not always shopping.

At the same time, the American malls used to have three or four department stores plus a hundred stores. They didn’t need a food court. They didn’t need anything else because people were going there to shop, and that was the only way they could shop. We never had very strong department stores. We never had such strong retail, so we needed to put other stuff together in order to attract people. For 50 years, that became the trend. We needed to put this equation together. Now, when people can very conveniently shop online, you need to add other uses in your property. I think sometimes in America things became so efficient, that people were just not paying attention to details. Everything goes so fast. [In Brazil], we still have a slower pace. People are more service-oriented.…And that helps our business to create this aura of service and quality.

WWD: You’ve said you want your malls to be a place where people are happy. A very basic, lovely thought.

C.J.: When I started to work, that was my first thought. Our place is really about making people happy. That’s why they will come back. That’s the whole idea, and how we think about all the things we’re doing. That’s why we invest so much in flowers, we invest so much in service, in training, in quality.…If we make people happy they will come back. If we don’t make them happy, then we have trouble. Because [then it becomes] just about the rational aspect of shopping, and it’s very easy to shop online.

WWD: How do politics impact your business?

C.J.: I always tell my people it’s not only inside the mall that we have to take care [of], but outside our mall, the environment needs to be nice. So we need to take care not only of our business environment, but the community around us. We need to understand city development, and how we can help the city. That’s why we have an effort to run Parque do Povo — “People’s Park.” It’s our neighbor and it is the best small park in São Paulo, in Brazil. Many times it’s won the best small park. People love it.

WWD: You’re deeply involved with municipal development. Tell me about the program in partnership with Columbia University.

C.J.: We have a program, Comunitas, that we support along with other companies. It helps to integrate the public and the private sectors in 15 cities, from São Paulo to smaller cities. Private companies work with [city officials] helping to educate and develop the management skills of mayors and people who work in the public sector. Part of the program is a partnership with SIPA [Columbia’s School for International Public Affairs]. We spent a week looking at what’s being done in Brazil and here in America, especially New York, especially from the Eighties and Nineties when New York was in trouble. The program [centers on] sharing experiences and talking about challenges and ideas for partnerships between the private and the public sectors.

WWD: As a business leader, how important to you is that sense of civic duty?

C.J.: I am a believer, especially in countries like ours, that the State still has a lot of power and the scale to do good. The problem is, we need to have good leadership within the system, within the State in order to change the quality of services offered to the public in education, in health and in general. We need to work together in order to make the culture of public service in Brazil more in line with what we do in the private sector, in order to treat the citizen as a consumer, not to make a profit or anything like that, but to understand the need to offer a better quality service.…The program [Comunitas] is six years old, and it has created a lot of initiatives that have made the lives of citizens better.

WWD: Of what are you most proud over the past six years? And what has been the greatest frustration?

C.J.: The frustration is that we in the private sector sometimes ignore the amount of rules that the public sector has, rules that make it very difficult to innovate. The good thing about our program is that we are able to innovate prototypes, test things, and when they work, to transform [them] into public policy. That helps to accelerate the good ideas, and that is the big thing about the partnership.

I think nowadays, with so much transparency, with the Internet, with so many people in the game, [everything is different]. A lot of the rules that were put in place 20 years ago don’t match the needs of today’s speed. On the other hand, I think all the initiatives we are able to put in place — it is my great joy. Some in health, others in restructuring process, and helping to be fiscally responsible.

WWD: Very impressive.

C.J.: Yes. In the private sector we are constantly doing research, we are focusing on the consumer, trying to be competitive, to be innovative. So we try to bring this view to the public sector. At the same time, being near them, we realize how tough their life is with all these regulations. We are able to have empathy with their needs and help them make some of these transformations. Working together, I learn a lot as well.

WWD: On the national level, what is the government-business relationship and how does it impact your strategy?

C.J.: I think it’s the economy. You really have to create a dynamic economy that can provide growth. The big challenge in Brazil is that we still believe that government provides growth, [but] growth doesn’t come from government. Government only spends the money that they take away from people and companies.

I think more and more, Brazilians are realizing that it’s more important to have less government in a larger economy, and that that will enable us to grow at a faster pace. It’s an evolution that I believe [comes from] the connection with the United States. From the Fifties, we have learned to look at the U.S. a lot, for creativity, for the tech world, for the meritocracy, and how to apply all those things. As a lot of Brazilians come to the U.S., they start to understand how people work here and try to get more connected to those ideals.

WWD: What is the prevailing opinion about what’s going on in the United States now?

C.J.: The U.S. is always ahead of the times in terms of what’s happening in the world. So I think the challenge of globalization to such a big country, the technological challenge of losing jobs and some of the inequalities that those things are creating, are making people feel scared and less confident about the future. I think that is reflected in choosing transitional leaders that try to offer [answers] in the short term. If you’re losing jobs, “I’ll stop bringing merchandise from abroad.” So it’s a very simple answer to problems that are much broader. Because it’s not about immigration or about an open economy. In my opinion, it’s much more about technology and the connected world and less opportunity for [some] people and how do you balance this.

WWD: You sound so thoughtful and lucid when so many people do not.

C.J.: Yes, because people shout. Look at television; it’s crazy. People don’t talk anymore, they shout. Even CNN. It became like a reality show rather than really a discussion. I think a lot of people are thinking about this.…As a businessperson, I always have to look at data. And when you see the data about the world, you see that we’ve never had a more secure world. People are living longer; fewer children are dying all over the world. There’s a lot of good data, but it’s just not getting to people. Which is relevant because if people are not feeling better, then something is missing that needs to be addressed by each country. I think the U.S. is just more visible to the world because it’s relevant, it’s huge, it’s everywhere. But every country is facing these types of challenges nowadays.

WWD: Do you have political aspirations?

C.J.: Everybody is asking that.

WWD: Well, do you?

C.J.: No. I have a family business I’m running and I’m fine. But I’m worried about my country and how we can contribute. And for me, it’s vital to be part of a discussion. I think we need to be part of the discussion and the solution.

WWD: Hearing someone talk reasonably and intelligently without shouting and without vitriol is extremely rare today.

C.J.: A lot of people I talk to have this mind-set. But maybe these people are not in television, they’re not in radio, they’re not able to provide their vision to a broader audience. But I think there’s a lot of people who are worried about that, and talking, trying to do something. [Note: WWD spoke with Jereissati Filho before far-right candidate Jair Bolsonaro won Brazil’s presidential election on Oct. 28.]

WWD: Back to the business: you embrace a word that many U.S. developers hate: “mall.” You don’t seem to have a problem with it.

C.J.: No, I don’t have a problem with it because in the end, it’s not about the word, it’s what you do with the word. Maybe what they didn’t do throughout time with their properties is what is hurting them, not the word. I remember coming here, doing courses in the ICSC, which is the International Council of Shopping Centers, and people were talking about rents and how well they’re doing and la la la, but they were not focusing on consumers and the experience. You’re just arranging the space for stores. That was never enough for us. The stores were part of the game, not the entire game. The entire game would have many more aspects. That was key to us, the strategy that in the end pays off. Now, we are much more protected. Not totally protected, nobody is, against technology. But over the years, we’ve looked not only to the rent aspect of our business, but also to the experience part of the business.

WWD: The experience — everybody talks about it now. It’s always been your concept.

C.J.: It’s always been our concept. From the moment we establish a brand, we create an idea. Because a brand is an idea with a lot of attributes connected to it. That’s why we’re famous for flowers, that’s why we’re famous for design and trying to create [elements] that [most developers] would not design for malls or design for department stores.

And, of course, we’re looking at it as a mall, but we are looking to [other industries] — what are they doing, what are they creating? When we did our valet service, I remembered a trip I took to Cambodia, and that going back to the hotel a guy gave you a cold towel, because it’s very hot there and there’s a lot of sand, and a bottle of cold water. Brazil is hot, and when people go through the valet service, we give them a small bottle of cold water.

WWD: So smart, and a simple thing.

C.J.: Everybody loves that. We did that like 15 years ago; we kind of created a pattern in Brazil. Now, you go to many places and the minute you get inside, there’s water. These types of things don’t add a lot of cost, but create an important connection with the customer.

WWD: Your four malls in São Paulo, what are the points of differentiation?

C.J.: They serve different neighborhoods. It’s like one mall would be in SoHo, another on the Upper East Side, another, downtown. São Paulo is a 20-million-people city. Nowadays people will go like 15 minutes, they will go to this place because it’s the center part of their area, while the other one is another area.

Market Place is one of four malls the company Iguatemi operates in São Paulo.

Market Place is one of four malls the company Iguatemi operates in São Paulo.  Courtesy Photo

WWD: Do all service the same level of customer?

C.J.: We have two very high-end malls, the two most high-end malls in Brazil, Iguatemi São Paulo, JK Iguatemi. They’re close, like two kilometers away from each other. And then we have two others that are more middle-high, which are more neighborhood ones, Market Place and Pátio Higienópolis.


Iguatemi ceo Carlos Jereissati Filho describes Pátio Higienópolis as more of a neighborhood mall.  Courtesy Photo

WWD: Your family’s company bought Iguatemi in 1979 and kept the name. What’s the origin of the name and what does it mean?

C.J.: The name was a street that was just in front of the mall. Iguatemi is [an indigenous] word, from the Indians.Iguatemi” means “river with dark green waters.” And over time and for our country, “Iguatemi” the word became the symbol of luxury.

WWD: Your family is Lebanese?

C.J.: Yes, originally Lebanese, my great-grandfather. They were Lebanese Christians, and they ran away. It was the beginning of the 20th century. So my grandfather was already Brazilian.

WWD: You grew up in the Iguatemi world. Did you always know you would go into the family business?

C.J.: I was very lucky because this industry that we got involved in, the mall industry, it’s about people, it’s about behavior, consumption, design, experience. So there’s a lot of elements that are very relevant for what I like to do and that I am good at. So it was love at first sight. I was very happy.

WWD: How did going public change the job and change your perspective?

C.J.: We still keep control of the company; we have more than 50 percent. We can still nominate the ceo, set the goals of the future. We are able to keep the same level of long-term commitment.

WWD: In the time that you’ve been involved in the business, what has changed most? Technology? The consumer mind-set?

C.J.: I think the biggest change has been the technology, but in a way that has made individuals more and more powerful. The power of the decision, and the ability to decide what they want and how they want [it], when they want, is more and more in the hands of individuals.

WWD: We haven’t discussed brands. Are there brands that make a mall? How do you differentiate your malls via the brand mix?

C.J.: I think the equation is vital. You have to understand that you have different demographics, and how you can serve the demographics. One of the good things about Brazil is, because we’re more of a closed market, with barriers and taxes and all that, we have a very important fashion industry. So it’s relevant to have an equation that includes brands that people recognize all over the world. At the same time, you need to look for brands that are part of your culture, and show the ones you believe in.

WWD: The difficulty with importing obviously plays into your focus on local brands.

C.J.: Seventy percent of our stores are still Brazilian brands. There’s a lot of new brands appearing in the market.…When you go to [our malls], you have the chance to discover, “wow, this is different! This is a brand I don’t know.” We want to provide the best brands that are really doing a good job for our market.

WWD: Can you assess the state of the Brazilian fashion market right now?

C.J.: Because of the way we configure our economy and because Brazil always wanted to be the industrial hub for South America, we’ve always protected businesses in Brazil. Everybody knows there are a lot of taxes and it’s tough to bring things in, to import stuff.

At the same time, I think Brazilians, because of the history — the influence of Europe, the Portuguese and Spanish and French influence — we developed a very interesting sense of style, and that led to a fashion identity, especially in summertime. We are casual people with this outdoor life, with a young customer and a young attitude. No matter if you’re older in Brazil, you always want to be young. That’s why now there is this persona of the Brazilian style, and fashion was created around it. Now, especially with the Internet and the ability to sell online, a new generation of designers is coming into the market, creating a new approach, a new fashion.

WWD: When you say “creating a new fashion,” does it still mostly play to that casual lifestyle, or is it broadening?

C.J.: Our way of approaching life is pretty much that — mixing up things but always very casual, very fun, very relaxed. That’s the way Brazilians approach daily life, and the way they express themselves through fashion. Because it’s an outdoor [lifestyle], Brazilians are the most fit people — their love for gyms, for fitness centers, and all those things [is strong]. So I think that the Brazilian [mind-set] is matching [this moment] for fashion.

WWD: At the risk of stereotyping, we have an image of Brazilians as being not only the most fit, but among the most beautiful people on Earth.

C.J.: They are the most beautiful people. There is this love for appearance. It’s very strong in our country. Brazil was famous for plastic surgery, but nowadays for fitness, for treating your hair, your teeth. There is a [desire] to look well; it’s all over the country.

WWD: Back to fashion: are there categories apart from swimwear that are particularly strong?

C.J.: Beachwear for sure is a very famous part of our [industry]. And everything that’s related to that lifestyle, around the beach life. I think that’s pretty much where we grow and where we are strong.

WWD: What Brazilian brands have been most successful at breaking through internationally?

C.J.: Osklen, Havaianas Adriana Degreas, Alexandre Birman and Silvia Furmanovich are some of the ones that I know that do a good job.

WWD: One one hand, the dense concentration of Brazilian brands distinguishes your malls for international consumers. On the other, the protectionism must be frustrating in terms of bringing global brands in.  

C.J.: Yes. It makes it harder for us to have [the best] combination of brands from inside and outside the country. I would like it to be more balanced. But at the same time, I like also this identity that we created, that you come to Brazil and you can see different stuff. We need balance, but I think some protection is good because it creates a market that is relevant for Brazilians and for the world. Because you go everywhere in the world and it looks the same. That’s not that interesting to the consumer.

WWD: What are the key international brands that you’ve brought into Brazil?

C.J.: The key international brands are the big ones, like Hermès, Chanel, Bottega, Prada, Vuitton, Dolce, Van Cleef. These really set up a beautiful combination. With the smaller brands, they make it a beautiful difference.

WWD: Any other global brands you feel strongly about?

C.J.: Gucci, Valentino, Armani, Tiffany, DVF, Bulgari.

WWD: Are there brands you don’t currently have that you’d like to bring in?

C.J.: We would love to have brands like Balenciaga or Celine or Missoni or Stella McCartney that are not in the market.

WWD: As a mall developer, what is your single biggest challenge today, and your biggest opportunity?

C.J.: The biggest challenge is to see more technology within the stores and help the customers have a better in-store experience. Also, to use technology to help the customer have the best opportunity within our malls. At the same time, I see this as a big opportunity for us, especially when I see all those big players in online business trying to have a physical experience. Through technology we have a great opportunity to create balance between the physical and the online worlds. I think that’s key for the future of physical retail: to have a much more Uber experience within the store.

WWD: Within a mall, the individual brands are in control of their own technology. How can you help those brands better their technology?

C.J.: That’s the challenge for us, but we are comfortably in contact with the brands and try to push them to add technology within the stores. Plus, we can create our own CRMs, in order to provide more information for the tenants, [to help] them be more effective in servicing their clients. So we have an ongoing conversation with our tenants about what they’re doing, the steps they’re taking, how they’re pushing these kinds of initiatives. That’s pretty much our role, as long as we’re creating a very exciting environment for people to come to.

WWD: You’ve mentioned Uber twice.

C.J.: It’s the experience with no friction. Because shopping is fun. People love shopping. It’s a social experience, and there is a gratitude for that. But there is also the process. The moment you address the bad part and lessen friction through technology, you improve the customer’s [experience]. You want the customer to want to say, “I like being in this place because there’s always [something] beautiful, and I don’t have the bad part. I will come more often, and it will be a fantastic experience.”

load comments
blog comments powered by Disqus