Mall Operators Adjust to the Times
Two separate articles, one by Bloomberg News and the other by The Wall Street Journal, make it clear that a) mall operators are facing significant challenges in the current environment and b) there are high- and low-tech steps they are taking to keep consumers shopping in their facilities.
The Bloomberg piece focused on mall operators’ use of digital technology, including setting up a virtual mall (Westfield Group), smartphone apps (Simon Property Group) and GPS tracking software (Hammerson Plc).
Westfield’s virtual mall in Australia and New Zealand provides shoppers with a price comparison tool for the retailers in the physical location. According to Bloomberg, “The service provides a single checkout and links on social network sites for shoppers to give feedback on merchandise and service quality.”
Simon has its own mobile shopper club and offers shoppers the shopkick app to let them know where to find special deals when walking around its malls.
The tracking software used by Hammerson is interesting because it gives the company clearer insights into how consumers move around the facility, which in turn, helps it better position stores in optimum locations.
The Wall Street Journal article looked at the increasing willingness of mall operators to lease space for kiosks and temporary stores to small entrepreneurs.
“I think a lot people right now are finding that they’re either out of work or they’re looking to add income to their household,” Patricia Norins, publisher of Specialty Retail Report, told the Journal. “Bottom line, everyone is asking themselves how do they bring more money in the door?”
According to Ms. Norins, sales of goods sold through these spaces (specialty products) rose in double digits to $2.86 billion in 2010. By comparison, traditional merchants rang up sales of $1 trillion on three percent growth.
- Mall Owners Fight Internet Erosion With Tech – Bloomberg News
- Malls Make Room for Start-Ups – The Wall Street Journal
Discussion Question: What steps being taken by mall operators do you think will go the longest way in helping them remain competitive in the years ahead?