Enda McShane: The Shopping Mall as a platform

Industry expert, Enda McShane of Velocity Worldwide gives his input on the the future of the volatile Retail sector. In this insightful article Enda discusses place of Shopping Malls in the, post pandemic, business ecosystem also giving his recommendations to those struggling small retailers.

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“The best shopping malls must be underpinned by a technology platform powered by high density, connected technology infrastructure, technology services and real-time, actionable shopper data, delivering a highly personalized experience for how shoppers want to engage with the destination. It must be an online to offline to online journey and it should be continuous not just at a few key times a year.”
Enda McShane – CEO, Velocity Worldwide

At the beginning of lockdown, I wrote a vision for the what I thought was the future of the shopping mall, now as we emerge from lockdown, we are already beginning to implement some of that vision, and we haven’t even reached the midway point of 2020.

One of the great lines I read during lockdown pertaining to retail was that 2030 is now 2020 and that retail was going to have an over reliance on people and technology if it is to accelerate its way out of the current position.

Retail has flirted with change many times over the last 2 decades and in particular over the last few years, as we have seen many high street brands disappear. For many, change has always been about the retail mix, go get a new anchor tenant or a cool new retail brand to open and things will improve, but it hasn’t.

Redeveloping shopping malls and changing the retail mix will not deliver what shoppers want today, and it is now the shopper who is demanding more, retailers can no longer rely on a strong supply chain and play the logistics game, they are in the shopper game and that is much more difficult to understand and be successful at.

Shoppers identify with product not the shelves they sit on, product drives sales both online and offline, so retailers and mall owners in particular need to be able to recognize who their shoppers are and know what they want, they then must match a buyer (shopper) with a seller (retailer) at all touch points that lead to a sale. This is the new customer journey and for those in retail that still think in channels, the time has come to start thinking in terms of customer journeys.

To think and act on customer journeys you will need technology infrastructure, an integrated services layer and an experience layer that is powered by real-time and actionable customer data.

Technology will become the new enabler for the change that is required right across retail, but in particular in the shopping mall sector.

Technology will enable the mall to think and act as a platform and to be able to treat all shoppers as registered users, building shopper profiles that will unlock all kinds of benefits based on personalization and customer preferences, and this can all be done in real-time in the physical brick and mortar location. We can finally bring the best of digital to the physical world, not the other way around.

Once the infrastructure is in place the mall can reinvent the offer, there will not be an over reliance on static retail stores, the mall (or whatever we end up calling it) will offer much more, as David Simon, CEO of Simon Malls in the US said:

"We continue to redevelop our irreplaceable real estate with new, exciting, dynamic way to live, work, play, stay & shop, that will further enhance the customer experience"
David Simon, CEO Simon Property Group, August 2018

The future mall will be a combination of shopping, leisure, residential, co-working and even E-Sports arenas. Imagine the ‘Fusion’ of best in class providers into a new customer (user) experience.

Added to the types of offers above can be high end Pop-Up Shops, Co-Working spaces such as WeWork, E-Sports Arenas, residential living and much more.

Brick and mortar retail is not dead and it will come back stronger than ever, the blueprint is already here, learn from E-Commerce providers like Amazon but go further, digital exists in the physical world not just online, malls in particular need to embrace technology infrastructure as the driver of change, believe in what can be achieved, listen to what their customers are saying and act on it as quickly as they can.

Those that move quickly will become the new template for success, the financial rewards will follow, and the commercial models developed will be attractive and sustainable for an industry that requires modernising.

Recomendations

In summary I believe landlords and retailers now need to begin thinking about and implementing the following:

  1. Technology infrastructure should be the foundation (this can be done on an Infrastructure as a Service model, i.e. no capital expenditure)
  2. Integrate the service and experience layer to the infrastructure i.e. what digital tools and what experience are you wanting your customers to have, license these don’t attempt to build them
  3. Begin a data acquisition strategy - actionable customer data is going to be vital, in fact it’s an actionable customer profile not just an email address
  4. Understand your customers journey - real-time communication right across the shopper journey, pre, in and post is critical
  5. We must bring digital to physical, not the other way around – unlock the best practice in digital and look at how you can deliver this in the physical world
  6. Retail and malls in particular must think like platforms
  7. Brick & Mortar shoppers must register as users, registering unlocks benefits, no profile, no benefits, it’s a trade-off, post-Covid-19 we will have to register to go to the pub, so why not to go shopping if the benefits are good enough
  8. Product not the shelves they sit on drives sales, stores are less important than access to product – how can you promote product availability in the stores that are in your mall, people want to know that they can get what they want before they leave home, this is going to be very important for brick and mortar
  9. Therefore, backend inventory and front-end customer data must be connected – matching people with products means sales happen
  10. The commercial model must change; landlord tenant relationship must align with the new retail (seller) and shopper (buyer) relationship.

Enda McShane

Enda McShane is CEO of Velocity Worldwide and marketing and software business delivering their strategies alongside a real-time customer data platform for brick and mortar, Darius for Retail.

Velocity has also partnered with Landways to offer the full technology infrastructure mentioned above on a long-term operational model, no up-front capital expenditure required. www.landways.com

Velocity Worldwide Landways

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