Are Retail Malls Dying?
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Transcript of Are Retail Malls Dying?
THROUGH AN F&B LENSE: SHIFTS IN THE FOOD LANDSCAPE
MERRILL PEREYAQSR PROFESSIONAL, AUTHOR, CONSULTANT, MOTIVATIONAL SPEAKER & IDEA GENERATOR
© 2016 Expand Your Brand
WHO AM I?
I expand and commercialize franchise operations, specifically in Quick Service Restaurants (QSR).
Brands include: • Domino’s Pizza (Indonesia)• Healthy Habits (Australia and New
Zealand) • McDonald’s (Saudi Arabia, Pacific Islands and SE Asia).
© 2016 Expand Your Brand
WHO AM I?
ASIA PACIFIC
INDIA
SAUDI ARABIA
AUSTRALIA & PACIFIC ISLANDS
A strategic and performance-focused executive with more than 25 years of leadership in Asia, the Middle East, South Pacific and Australia.
Expertise lies in leveraging global resources, capabilities and relationships to gain advantage in growing brands in new countries.
© 2016 Expand Your Brand
WHO AM I?
Whether your business is a small business wanting to grow into new territories, you want to franchise or you want to move globally, Expand Your Brand will provide you guidance and valuable tips on how a business can benefit, avoid the pitfalls and fast track to expanding the brand.
© 2016 Expand Your Brand
July 1998
ARE MALLS REALLY DYING?
“The retail guys are going to go out of business, and e-commerce will become the
place everyone buys”
– Marc Andreessen, American entrepreneur, investor and software engineer
© 2016 Expand Your Brand
THE GROWTH IN E-COMMERCE
2014 2015 2016 2017 2018 2019
China 12.4% 15.9% 19.6% 23.8% 28.6% 33.6%
S. Korea 10.3% 11.2% 12.1% 13.0% 13.9% 14.7%
Japan 5.9% 6.7% 7.5% 8.2% 9.0% 9.7%
Australia 5.6% 5.9% 6.3% 6.6% 6.9% 7.2%
India 0.8% 1.7% 2.6% 3.6% 4.4% 4.8%
Indonesia 0.8% 1.4% 2.2% 3.1% 3.9% 4.4%
Other 3.0% 3.2% 3.4% 3.4% 3.7% 3.8%
Asia-Pacific
8.2% 10.2% 12.4% 14.9% 17.6% 20.4%
Worldwide 6.3% 7.4% 8.6% 9.9% 11.4% 12.8%
Note: includes products and services ordered online via any device, excludes travel and event tickets. Excludes Hong KongSource: eMarketer Dec. 2015
Retail Ecommerce Sales as a Percent of Total Retail Sales in Select countries in Asia-Pacific and worldwide, 2014-2019
For the first time, the Asia-Pacific region not only has the largest digital retail market in the world,but its share of global digital retail spend holds an outright majority of the world market.
© 2016 Expand Your Brand
Alibaba, the most valuable retailer, has no
inventory
Uber, the world’s largest taxi company owns no fleet
AirBnb, the largest accommodation
provider owns no real estate
Facebook, the most popular media owner
creates no content
THE INTERNET IS CREATING PROFITABLE BUSINESSES
© 2016 Expand Your Brand
MOBILE SPEED CONTINUES TO GROW
5G mobile broadband, set to launch in 2020, will unleash speeds that are faster than 4G and create waves of innovation that will disrupt every industry.
© 2016 Expand Your Brand
STORES WITH OMNICHANNEL STRATEGIES WILL THRIVE
According to the International Council of Shopping Centers (ICSC) over 198 million shoppers still visited a brick-and-mortar location between November 1 and Dec 25, 2015, despite the 13% growth in online sales during that period.
© 2016 Expand Your Brand
MULTI CHANNEL, OMNICHANNEL – NOW SOCIAL…..?
Facebook and Twitter’s “Buy” buttons and Instagram’s “Like2Buy” is now creating avenues of shopping through social media.
© 2016 Expand Your Brand Source: Joe Skorupa, Retail trends and predictions for 2015
The need to provide seamless online to in-store experiences continues to grow.
Birchbox’s Soho location offers hair, makeup and nail services in its store.
Urban Outfitters New York City branch has an on-site salon and coffee shop, in a move to turn the location into a destination, rather than just a store.
MORE ECOMMERCE SITES ARE SETTING UP OFFLINE
© 2016 Expand Your Brand Source: Joe Skorupa, Retail trends and predictions for 2015
Aimed at the ultimate consumer convenience, none actually makes food but connects restaurants and customers.
TECH-DRIVEN DELIVERY IS CHANGING THE F&B INDUSTRY
© 2016 Expand Your Brand
IN-STORE VS ONLINE STATISTICS - USA
78% of customers prefer to shop in-store
Consumers purchase at online retail websites
an average of 2.2 times per month.
Average time spent at a brick-
and-mortar store
54 minutes 38 minutes
Average time spent on a single
retail website
Consumers spend significantly more per
month in a physical store than online
$1,710
$247
73% want to try on or touch merchandise before they
purchase Source: ICSC, Shop Visible© 2016 Expand Your Brand
BRICK-AND-MORTAR STORES ARE STILL BEING VISITED
48% 37% 35%
Of consumers have ordered online and
picked up their purchase in-store
Of use the internet to locate or
research items, but prefer to make
purchases in-store
Of consumers have ordered online and
returned their purchase in-store
Source: ICSC, Shop Visible© 2016 Expand Your Brand
1 in 20 consumers make a purchase after browsing an online store
1 in 5 consumers make a purchase after browsing a physical store
CONSUMERS BROWSING ONLINE VS IN-STORE
Source: ICSC, Shop Visible© 2016 Expand Your Brand
The retail landscape is globalizing and digitizing, and customers are increasingly demanding and in complete control of their shopping destiny.
So how do you stay meaningful while everything around you is changing?
A shift in thinking.
MALLS MUST CHANGE
© 2016 Expand Your Brand
CONSIDER NEW TECHNOLOGIES & CREATE CUSTOMER ENGAGEMENT
Use Beacon-triggered messages to lure shoppers into retail stores for snacks and meals
© 2016 Expand Your Brand
USE NEW TECHNOLOGY TO KEEP A SHOPPER LONGER ON THE PREMISES
From virtual fitting rooms to interactive window displays, merchants are continuously finding ways to use Augmented Reality to draw attention and improve experiences.
© 2016 Expand Your Brand
IF YOUR FORMAT DOESN’T WORK, CHANGE IT
Spain’s shopping mall Las Arenas de Barcelona has been constructed out of a former bullring and is a destination in itself – with views from the roof, the restaurants and a rock museum inside, in addition to the regular retail therapy.
LAS ARENAS DE BARCELONA, SPAIN
© 2016 Expand Your Brand
CREATE A DESTINATION, NOT A MALL
Westfield Old Orchard in Chicago has demolished its food court and replaced it with a single outlet called Wilde & Greene, incorporating a grocer, supermarket, restaurants and bar.
WESTFIELD OLD ORCHARD, CHICAGO
© 2016 Expand Your Brand
Provides consumers with lifestyle recommendations from both cultural and technological perspectives.
The store offers concierge services, with every section helmed by an expert in a particular field.
The travel section’s concierge desk books holidays and is headed by a former journalist who has visited more than 100 countries and written several guidebooks.
CULTURE CONVENIENCE CLUB, JAPAN
CREATE A DESTINATION, NOT A MALL
© 2016 Expand Your Brand
CURATE SHOPPERS LIFESTYLES WITH EXPERIENCES
Restaurants can provide unique social experiences that consumers can't enjoy by clicking "buy" on their smartphones.
DEVIL ISLAND PRISON RESTAURANT, CHINA & A380 FLIGHT RESTAURANT, TAIWAN
© 2016 Expand Your Brand
Evoke consumer emotions instead of offering ease of purchase. Let online be ‘convenience’ and ‘fast’.
EVOKE SHOPPERS EMOTIONS THAN CONVENIENCE
VOGUE CAFÉ, DUBAI & FRAGRANCE BAR, ITALY
© 2016 Expand Your Brand
At their Experience Center in Atlanta, Porsche teams an auto showroom with an upscale restaurant called 365.
It looks onto a driver development track.
EVOKE SHOPPERS EMOTIONS THAN CONVENIENCE
PORSCHE, ATLANTA
© 2016 Expand Your Brand
A hybrid concept between a lingerie store and an automated store/vending machine.
Customers select their lingerie products on large touchscreens/tablets and receive them via transparent aero-propelled tubes.
UNDIZ MACHINE, FRANCE
CREATE EXPERIENCES YOU CAN’T FIND ONLINE
© 2016 Expand Your Brand
Besides great shopping, Westfield London boasts a phenomenally successful champagne bar, a Flight Simulator and an upmarket teeth-whitening kiosk.
CREATE EXPERIENCES YOU CAN’T FIND ONLINE
WESTFIELD LONDON
© 2016 Expand Your Brand
ADVANTAGES QSR HAVE IN MALLS
1. Most QSR brands want to scale their brands – and do this fast
2. Building permits and approvals are easier to obtain with malls and shopping centers
3. Foot traffic is higher in malls4. Malls provide easy access to utilities5. Quick and fast set up of the project
© 2016 Expand Your Brand
The big question is this; is the future of the shopping center actually not about shopping at all?
Perhaps it’s a place you go to meet friends, dine and be entertained in a myriad of ways, and shopping is an adjunct, not the purpose of the visit.
THE FUTURE OF THE MALL IS NOT SHOPPING
© 2016 Expand Your Brand
Whatever happens, the retail center, like retail itself, will be transformed in the next few years.
It is time for malls to spice up their relationship with customers.
We do not have to kiss the malls goodbye.
WE CAN STOP THE MALLS FROM DYING
© 2016 Expand Your Brand
Always ask yourself if your efforts are truly providing a more enjoyable experience for your customers.
Stick with that strategy, and you’ll be just fine in the future.
CUSTOMER EXPERIENCE MATTERS
© 2016 Expand Your Brand
Q & A
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THANK YOU
www.merrillpereyra.com