Shopping malls are not dying; they are changing, is what the industry experts have to say. And going forward from 2019 we are going to see some big changes.
Text: Leandra Monterio The increase in the number of e-commerce sites has in no way deterred the brick and mortar retail industry from being a success. In fact e-commerce sites are also investing in physical stores. E-commerce brands like Nykaa, Myntra and Pepperfry have now opened offline stores to establish a better customer connect. The conversion rates in-stores are higher than online. Google too prioritizes brands that have a physical store. For instance, when a customer searches a product, the search engine results point out to brands with offline stores more than the ones with only online presence. In the build up to having physical locations many retail brands are experimenting with pop-up shops. These shops appear from time to time in a specific area and help companies navigate the outcome of a physical shop without actually owning or renting their own real estate. Brands have come to realize that having a store where customers can walk in is an important part of their experience. Indian customers tend to prefer purchasing products they can physically see, feel and evaluate. Another major attraction for customers is having everything under one roof. Customers get a choice of high-street goods to local brands and even edibles all conveniently at the same location. In this regard the offline retail and mall industry in India is going strong. Also read http://realtyplusmag.com/rising-aspirations-moving-towards-smart-cities/ The past few years changes in consumer shopping behavior has made the retail sector sit-up and realign their retail real asset to adapt and avoid becoming obsolete. Malls with central atrium, corridors, lobbies and indoors are going to be passé soon. Open mall concept imitating the high street shopping is a new concept coming into India. With rising environment consciousness among shoppers, malls too are now turning eco-friendly in their design & construction, unheard of earlier. What’s more, metro cities being spoilt for choice has led retail real estate developers to foray into tier II & III cities. The increasing consumer base and spending potential even in these regions has opened up an opportunity for many retailers leading them to make a beeline towards tier-II cities. The one time myth that online shopping was going to put malls and other physical retail outlets out of business has remained nothing but a myth. Future success of Indian retail story depends to a large degree on being able to ‘unlearn’ the lessons of the past. Also read http://realtyplusmag.com/new-indian-shopping-experience-the-future-of-indian-shopping/ Future of Shopping Centers According to new A.T. Kearney research—the leading traditional brands are rethinking how they arrange their stores. Landlords are reconsidering their tenant mixes, bringing in more food and entertainment options. And digital start-ups are setting up a physical presence of their own, albeit more cautiously and with a different approach than the industry's precedent would suggest. The 4 Models of the shopping malls of the future are -- Destination Centers: Instead of a retailer, the anchor here is a compelling social experience —an indoor ski slope, roller coaster, concert space, or museum or an experience-based entertainment. E.g. Mall of the Emirates in Dubai.
- Innovation Centers: In this format, pooled tenant data is used to create targeted offerings. A certain percentage of space is designated for test stores like Apple retail flagship store that use the data gathered on new concepts. The consumers have the opportunity to test new technologies, access experts, and trade personal shopping and product evaluation data for discounts on new items or new products.
- Values Centers: They are anchored by an idea, not a retail nameplate such as animal rights, or sports and all tenants provide an experience that tie into this. Dynamic pop-up locations and virtual or group showrooms allow local merchants to showcase their offerings on a rotating basis and provide local artisans and designers the opportunity to interact with customers. E.g. Great Food Hall in China.
- “Retaildential” Spaces: These spaces target a specific consumer segment. They will be focused to cater to a specific life stage or lifestyle like young professionals, baby boomers, senior citizens etc. with shared needs and interests. These highly curated “life-stage centers” offer a demographic-specific and appropriate set of retail, restaurants, entertainment, and services. E.g. Aeon Co. malls for senior citizens in Japan.
