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Why shopping malls will beat e-commerce in 2019 (Examples included)

8/10/18 3:17 PM by Uffe Aalborg

 

As Amazon keeps growing and new e-commerce shops opens every day, market experts have claimed that shopping malls will disappear in the coming years.

Here, at Emplate we also see the tread from e-commerce shops. However we also see that shopping malls have great advantages and we now see that malls are taking initiatives to keep customers coming back.

In this article we have look at some of these initiatives and elaborated on them - we hope you will find inspiration in them.


This article has 3 headlines. (Click on one of them to jump right to it)

1. Shopping malls starts to optimise the floor plan to improve experiences and convenience

Traditionally the purpose of shopping malls has been to rent out locations to a large variety of tenants. With the purpose of serving customers an easy possibility to browse shops and choose the best offer.

However, the internet and e-commerce changed all that!

Today 50% of customers research products before buying, and this creates an advantage for e-commerce shops.

However shopping malls still have the advantage of having the product available for customers to see before buying, but probably more important: Shopping malls are able to create offline experiences!

“Shopping malls have an important advantage towards e-commerce: Shopping malls can create experiences that make the customer wanting to go and have a great time while shopping, instead of buying online and waiting for it to arrive.”

Simon Staack – Co-founder of Emplate 

Therefore shopping malls can benefit by changing the strategy, from only focusing on renting out to tenants that can attract customer to now focussing on creating experiences and convenience for customers.

Thereby the strategy for the shopping malls changes to create a mall where customers like to come. This results in customers choosing to go and shop at the mall instead of shopping online.   

Example: 

A recent example is the new ‘Broen’ mall in Esbjerg - A shopping mall with 65 shops located in western Denmark. A mall placed in the middle of the city on top of the train station. 

From the very beginning, it has been the idea that the mall should function as an experience centre. 

Therefore the architect placed a large spot in the middle of the entry floor. Here the marketing personel can arrange all kinds of events - e.g. face painting for kids. 

By placing the event spot on the entre floor customer gets aware of the event as soon as they enters the mall. This makes them stop and participate if the event is relevant for them. 


Resulting in families with children using more time in the mall!


All Around the event spot, special shops were placed. Thereby the parents are prompted to browse in these shops as the children participate in the event. Making them more likely to buy impulsively.  

However, the event spot was not the only clever move made in order to create experiences.

In the basement, a large fitness centre and a modern cinema are placed. These attractions make sure that different customers segments will use the mall, and it ensures that customers will enter the mall at all hours. This makes an urban experience when shopping in the mall.

To create a “whole day” shopping experience a food court was placed on the first floor. Their customers can spend hours shopping, then rest for a bit and go back shopping. Making customers spend more time at the mall.

Shopping convenience is equally important

Because the mall is placed in the centre and on top of the railway. Therefore there is a lack of parking spaces available for the mall.

Therefore the architect placed the parking lot at the top of the building, ensuring that customers with cars will only use two Entrances.

Thereby the mall management could place the large shops on the second floor. Then customers didn’t have to worry about caring their newly brought goods.

The development of the floorplan increases shopping experiences and makes it easier to shop at the mall. Making the mall experience a much better competitor to the convenience of sitting at home and ordering from an e-commerce shop.

 

2. Shopping malls start gathering customer data, to improve shopper experience


E-commerce shops have the advantage of having Google analytics data. With this data e-commerce shops can see all the actions that customers take doing their visit at the website.
 

Shopping malls lack customer behaviour data in this extent. However, 2019 is the year, where this is going to change.

 

2.1 Beacon technology reveals data on how customers behave doing their visit

Here at Emplate we have developed the beacon technology to work in shopping malls.

With the beacon technology shopping malls can get data on how their customers move around in the mall and which stores they visit the most. The data can even be segmented to measure men and woman, and thereby see the different movement based on gender.

This data can be used to see areas that customers don’t use, and therefore can be improved – a nice tool to creating interactive environments and memorable customer experiences.

Pro Example: 

How herningCentret uses Ibeacon technology

herningCentret assembles direct insight on their visitors moving patterns through a personal tailored mobile app and beacon setup delivered by Emplate. The setup enables herningCentret to see where their customers use the most time doing their visit. 

Click here to read the full case study

 

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2.2 Improved possibility to create loyalty programs with Psd2 opening 

The first and most significant change is that the new Psd2 regulation will be fully implemented by the start of 2019.

In short Psd2 means that banks are required to provide customers transaction data if the customer gives permission.

This data creates the possibility of shopping malls to create a greater shopping experience for all customers. 

Example:

Here at Emplate we know how much loyalty programs matters. Just look at the above example from Waves. 

Today the best shopping mall loyalty programs (Ours included) uses place-tracking technologies to identify where the customers physically are located in the mall and gives points based on the customer's movement.

With the new Psd2 regulation shopping mall loyalty programs can be built based on customer transaction data. Thereby loyalty programs can be based on the items that the customer purchases, instead of where they are located.

Thereby customers will receive an incredible experience of receiving points immediately after buying a product – making the customers feel that they just won the lottery.

“We expect that our loyalty programs based on banks transaction data will have an enormous impact on how many times customers visit the mall pr. Year - simply because it creates extra value for the customer”

Simon Staack – Co-founder of Emplate

2.3 Psd2 implementation creates possibilities for the shopping mall management

For the management of theshopping mall. The data will create the possibility to see at which shops customers spend the majority of their money.

When the data is paired with customer behaviour data it will be possible to see at which shops certain customer segments spend money, and probably more important, where customers only browse.

This data can be used to improve the floor plan, but it can also tell where and when a planned event should take place in order to capture the attention from the right customer segment.

 

3. Shopping malls will be ready for click and collect

One of the biggest advantages shopping malls have upon e-commerce is that customers don’t have to wait for goods to arrive when they shop in the mall – customers can take their goods home with them.

However, some customers don’t want to go and find their products in the stores. They would rather sit at home and choose their product, and then experience the convenience of going to the mall and collect their products.

You may be wondering why we are yet to see a shopping mall website with a integrated click and collect system.

The reason is that a click and collect system requires close IT collaborations with tenant’s stores, as they have the data for products in inventory.

It also requires a shop application on the website of the mall, where customers can see all the products available at the mall. (Here seen at Westfield in London)

Skærmbillede 2018-07-31 15.34.11-min-1

However, we are currently helping shopping malls and tenant’s solving this issues.

Therefore do we believe that 2019 is the year where we see a click and collect system were customers can sit at home, choose the products they would like across all the stores in the mall, and then go and collect it in the next hour. 

We see a great advantage hidden here, as the collection can be made in combination with a visit to the groceries store that is placed in many malls today. Creating cross benefits between stores.

With a click and collect system, the mall will provide a service that e-commerce hardly can compete with, and we believe it to be a game changer. 

Click and collect will mean that customers can sit at home, or in their lunch break. Research products at the mall's website, buy them and collect them on their way home. Making it more convenient to use the click and collect than waiting 2 days for products to arrive, as it usually takes with e-commerce purchases. 

 

Final Thoughts

2019 will be an exciting year for shopping malls. Here at Emplate we expect it to be a year with a lot of progress, and we are looking forward to it.

If you would like to improve your malls digital presence, then I recommend you download the case study below. In the case study you can see how the danish mall herningCentret have turned their digital platforms into growth drivers that attracts customers. 

How a mall got 94.258 visits from their loyalty app in 12 months

Uffe Aalborg

Written by Uffe Aalborg

Head of Marketing. Passionate about using data to create better customer experiences. A fairly poor football player that uses passion to make up for it.