However, there are several malls in the country which are slightly on the slower side. The formula for a successful mall is not about expansion and mass anymore, it's about enriching the content mix of the mall. Both the mall design and the luxury tenant mix function together to generate a powerful experience for the consumers. The latest fashion is to offer consumers a one-stop destination which can accomplish their entertainment and domestic needs.
Until 2011, foreign direct investment (FDI) was not allowed in multi-brand retail, forbidding foreign companies from any ownership in supermarkets, convenience stores or any retail outlets. Even single-brand retail was limited to 51 per cent ownership. In January 2012, India allowed 100 per cent FDI investment in single-brand stores, but imposed the requirement that the single brand retailer would have to source 30 percent of its goods from India. Agricultural marketing was also expected to be benefited with the introduction of new technologies.
The business of retail is all about innovation and consumer connect as it is dynamic and in a constant state of progression. At its recent quick pace, this evolution will redefine how we discover retail tenants and structure and place our malls and shopping centers to provide outstanding customer experiences accordingly.
So far, shopping centers have responded well to the needs of the consumer and have worked to change the customer experience to entertain, engage and excite. Shopping centers health was vigorous in 2014 with stupendous growth in rents and net operating income, and occupancy rates at 93 percent, the highest level since 2008. From using beacons to personalise the shopping trip to providing free Wi-Fi and constructing all-inclusive apps, shopping centers are investing in technology to effortlessly intermingle the omnichannel experience.
Besides technology, shopping centers have revived the experience by curating a tenant mix that makes malls and shopping centers a place beyond shopping. New services are driving traffic by adding the convenience of one-stop shopping. The retail market is growing even with eCommerce coming in a big way, as the pleasure of physical shopping against online has a different satisfaction altogether. After all, there are a few limitations which can never occur in online platform.
There is also a great deal of attention being paid to design and architecture. Part of building that distinctive mall experience is in analysing the design details that will be at ease and appealing to each mall’s clientele. Many are building sustainable and energy-efficient properties, keeping up and outpacing today’s building standards. Older shopping complexes are getting a much-needed reboot, too, and owners are breathing a new life into their properties with renovations such as the merging of outdoor and indoor experiences simultaneously.
Here are five trends that will define the future of bricks-and-mortar retailing:
Production of flexible formats - To sustain the desires of retailer’s omnichannel business, shopping centers will rise physically and technologically to support the growth of direct-to-purchaser distribution.
Exceptional personalisation and connection to the consumer- Shopping centers will further leverage technology to generate a modified experience with enhanced customer satisfaction, location-based services and convincing in-store environments.
Blend of physical stores and eCommerce - Shopping centers will need to be at the forefront of enabling the always-on consumer. They’ll need to combine integrated digital channels with renewed physical space and a cohesive social media strategy.
According to a recent update from government, retailers will take control over the ongoing online market since they will not have to depend only on franchises for any further online sales. Thirty per cent of mandatory local sourcing has been shifted to first store’s opening from a recent acceptance of FDI. This footstep will lead to shore up brands in building long term sustainable supply chains that are good for India and will enable better prices to the Indian customers.
Re-evaluation of a new rental representation - By implementing the omnichannel future, there will be different means of reporting sales and determining rent, reflecting a flexible system that blends online and in-store sales.
Enhanced developer-retailer association - To generate maximum consumer engagement, property owners have to engage in a collaborative partnership with retailers where they share resources, insights and technologies. Even with all the industry’s innovation, this is no time to rest on our success. These trends will shape the way the industry operates, not in 20 years, but within the next five. This new period of retailing demands that shopping centers continue to adapt and keep pace with what consumers want not only today, but also in the coming years and these trends will surely add some glow in the retail industry.
Authored by: Kulbhushan Talwar, General Manager, Shipra Mall