Over the years, the retail sector has undergone significant transformation from mere brick and mortar to recreational-cum-shopping destination. Today, malls are no longer primarily about shopping, they have emerged as the heart and soul of communities.
It is no longer a revelation that COVID-19 has deeply altered the brick-and-mortar landscape. After facing a huge setback due to the pandemic, the retail sector picked up quite well. Various industry reports highlight the regained market confidence. According to the CBRE report, Grade A malls and high streets witnessed double the absorption rate in 2021 compared to 2020.
Besides, the BCG-RAI in a report mentioned that India’s consumption, which was growing at approximately 12 percent pre-pandemic, went into negative territory during the pandemic but now has recovered to surpass the pre-pandemic growth level at 17 percent. This comes as an encouraging sign for the retailers and brands to go strong on their expansion plans.
Trading with the trend to win
A bevy of global trends i.e., changing demographics, increased urbanization and COVID-19 safety measures are coming together to propel malls to change the role they play in people’s lives. Now, when consumers visit malls, they are looking for multi-sensory experiences, while simultaneously keeping comfort and hygiene in mind.
Additionally, sustainability concerns are also causing some consumers to prefer mixed-use developments where they can live, shop and work under one roof instead of driving to different places. Not to forget the e-commerce revolution and the rise of digital technologies that are fundamentally reshaping consumer expectations and shifting the function of retail spaces towards useful and entertaining customer experiences.
Safety comes first but convenience also matters
The world may be opening back up, but COVID-19 remains to be a real concern. In a post-pandemic world, consumer behavior is constantly evolving and they are likely to prefer the places serving as a one-stop destination to dine, shop and leisure built in a safe and secured environment. Innovative ways in customer service, facilitating holistic experience, and emphasis on hygiene and wellbeing of the customers are likely to strengthen consumer confidence and eventually help in customer retention.
Design-centric and innovative format
The most innovative malls today look nothing like their predecessors. Many of the malls being built in urban areas are open and fully integrated with the landscape. Even malls that are enclosed are now incorporating more natural ambiance into their design, installing plants and trees, wood walls and floors, waterfalls, and lots of glass to let in natural lighting. Such elements help malls better blend in with their surroundings.
Going the ‘Omnichannel’ way
For the uninitiated, Omnichannel typically references brands and retailers who have both a physical and a digital presence. Going ‘Omnichannel’ has become an integral part of strategies for all successful brands and retailers across the globe. However, Omnichannelisation in shopping malls is different today from the original concept. Customers are being provided information on deals and offers not just in the physical store but also on their mobile devices. The digital transformation of retail is not all bad news for malls. On the contrary, it presents new opportunities for malls to engage consumers throughout their decision journeys.
One-stop-spot: More the merrier
Malls are moving in a different direction, away from commoditized shopping experiences and towards a broadened value proposition for consumers. Innovative malls are incorporating value-added elements with substantial square footage allocated to Family Entertainment Centres (FECs). Think concerts, gaming zones, food court, premium fine-dine restaurants, art centers, spas, fitness clubs, and farmers’ markets – all under one space. The idea is to make malls the hub of the local community – a place to share quality time with friends and family. Some malls are making greater use of temporary, flexible spaces that can accommodate different stores over time. Pop-up stores and kiosks provide customers with a sense of immediacy and excitement for potential customers.
Customer Engagement
People do not visit malls to eat and shop only, what they take back with them are happy memories or experiences. Customer engagement is essential for malls to cater to the audience with a once-in-a-lifetime experience by staying relevant to customers’ lifestyles. Theme-based decorations, events, activations, live music, entertainment concerts, and kids-related engagements are a few key elements that keep the visitors intrigued for repeated visits. Such customer engagement activities help malls create a friendly environment where a customer gets the feeling of celebration and belongingness. Enhanced customer experiences are essential to staying ahead in today’s competitive environment.
Parting notes
The world of retail is changing dramatically, but malls can remain a center of attraction if they envision themselves as customer-facing providers of shoppable entertainment. The way forward will require effective communication, thoughtful planning, and creative execution because the “new normal” of retail isn’t temporary: it’s here to stay.
(By Abhishek Trehan, Executive Director, Trehan Iris)
