Are Shopping Centers Dying?
This is a common question that professionals from the shopping center industry usually make themselves.
In the new digital era, driven by e-commerce and technological innovation that makes it easier for everyone to get products, this question takes a more significant role.
Yet, the most important aspect of this new era that should be considered is the
EXPERIENCE. Not only do new customers look for a product, but they expect
to get the whole experience. This is the reason why people still think of
shopping centers as meeting points and visit them to enjoy the experience.
Younger consumers are increasingly seeking experiences over products.
Shopping centers, being places where consumers expect to find an experience, should provide them with new and even better ones.
As the commercial real estate industry is changing, its assets become an essential part of the consumers’ everyday life; thus, shopping centers are no longer places for shopping only, but they are becoming a place to enjoy and live a variety of experiences. For this purpose, shopping centers should follow these 5 courses of action:
1. Focus on safety and convenience: The new mall will have to make a balance between consumers’ desire for social interaction and their need for a safe, easy shopping experience. Retailers and owners should address customers’ concerns by finding innovative ways to improve store organization, interaction with customers, payment collection and product delivery.
2. Rethink the role of the store: Retailers must reconsider the size and number of stores designated to meet their customers’ needs, leaving aside poorer-performing stores and focusing on flagship, showroom, and pop-up experiences. Consumers will no longer visit stores just to browse; instead, they will get there knowing what they want, and the associate’s role will consist in providing a smooth buying process through an exceptional customer experience.
3. Make way for the food revolution: As mid-market fashion retailers move out of mall locations, their departure will make room for landlords to bring in an exciting new breed of restaurant offerings. This will feed the consumers’ desire for social experience and will likely become the new anchor to bring visitors to the mall.
4. Embrace technology: Retailers should follow in the steps of digital-first companies
—it’s never been more important to build a seamless omnichannel brand presence. Customers are increasingly looking for a digitized experience both online and offline, enabled by technological innovation at every turn. Malls and retailers need to use digital tools to maximize productivity and efficiency, and create a dynamic, engaging experience.
5. Become a new destination: Most of all, the mall must become the new meeting place for the community —a multi-purpose destination that offers extensive leisure activities as well as other functions, like office, residential, and cultural amenities. Shops should blend in with other complementary uses, giving visitors an interactive experience in which the entire environment comes into play. Owners may need to rethink their rental models to allow for different types of retail experiences, such as short-term pop-ups or exhibitions. There is a great opportunity here to be innovative.
So, are shopping centers dying? Absolutely not! They are adapting new consumer behavior, which demands more agility and digitization towards a better experience. What is more, the surface allotted to shopping centers continues to grow worldwide every year. Asia takes the lead with more than a 6%, followed by Europe with a 3.4%, Canada with a 1.7% and the US with a 0.5%.