Retail innovation is knocking.
Retail trends continue to evolve with the speed and complexity of innovation gaining faster pace every year. What was deemed innovative only a year ago may now be a distant memory and forward-thinking businesses are leading the charge; they are on an accelerated trajectory, driving concepts that are reshaping the retail space in a novel, cutting-edge way.
The retail sector is increasingly grasping the behaviours and needs of discerning consumers, understanding they are very specific about what they want, how they would like it and how speedily and conveniently they can access it. It is therefore imperative for retail property owners and others within the retail value chain to explore innovative ways in which to not only satiate this growing appetite but also introduce products, services and experiences ahead of need.
Testing the waters
Property developers should encourage creativity in shopping centres and an example of this is flexible leasing as well as pop-up stores. In commercial retail spaces, it promotes speciality retail, giving pop-up store owners the opportunity to dip their proverbial toes before making a commitment. Without spending a substantial amount on marketing, pop-up store owners are able to create buzz and interest in their product or service proposition. Pop-up stores also enhance customer experience which includes the relevance of the retailers offering, ensuring the attraction of a new customer-base and repeat customers from the retailers existing clientele.
The retail environment is changing and the South African Council of Shopping Centres is among the industry participants who advise that shopping centres should stay ahead of changes in technology, consumer behaviour and trends and evolve at a faster pace to stay ahead of the changes.
Additionally, seasonal trade is another way shopping centres can leverage the presence of pop-up stores as it ensures increased footfall numbers during periods such as Easter and the festive season. Also, part of the attraction is the autonomy to model stores in creative ways and test reactions to different design concepts. Beyond this, it is a great way to fill up vacant spaces while lease negotiations with new tenants continue, driving revenue for the retail property owner.
However, the wider benefit for the retail property owners and other outlets can be seen in the increase in footfall thanks to the consumer’s piqued interest. Consumers can access a diverse mix of shopping experiences – some of which may not be present as part of the existing retail mix. They are thus able to test new products, services and experiences while the outlets are able to gauge the level of future interest in that region/ across a demographic.
Catalysts for entrepreneurship
The retail sector continues to connect more people with established global and local brands as well as direct employment opportunities. The responsible business of today is also investing in more novel ways to empower the communities it serves. Through the right support and access to networks, the small business of today could grow into a successful multinational, and retail property businesses are in an ideal position to act as catalysts. Here, the words of Isaac Newton ring true.. If I have seen further than others, it is by standing upon the shoulders of giants.
Hence, leveraging its established patronage, retail shopping centres can act as that much-needed shoulder for growth. Accordingly, a trend that is destined to gain momentum is one that is aimed at providing entrepreneurs/ small business owners with a conducive formal trading environment in which to operate by connecting them with a sizeable and diverse consumer audience.
Marrying artificial intelligence with natural intelligence
Artificial Intelligence (AI) is increasingly intercepting traditional systems and processes and, in the future, will be ubiquitous. Progressive retail property businesses are exploring several ways in which to utilise this technology to provide an enhanced customer experience across its business’ value chain. Chatbots are one such form of AI. Already, in South Africa, customers can track their order via instant messaging platforms such as Facebook, WhatsApp or even through the use of a company’s mobile application. Through the convenience of a smartphone, a chatbot automatically retrieves this information, making the shopping experience that much more convenient and instantly fulfilling. This is a trend that is set to accelerate further in 2018.
Licence Plate Recognition (LPR) is another technological advancement that is set to become more commonplace. One such example of LPR that incorporates AI technology is Admyt. Number plate information is captured from the digital image, streamlining shopping centre entry and exit and making the vehicle searchable anywhere within the premises. This is a great security benefit. Furthermore, the driver no longer needs access to a physical ticket and parking meter as the LPR technology detects the vehicle and automatically debits the vehicle owner’s account for any parking costs – making the shopping experience more convenient.
Shopping centres are also utilising systems such as Syenap, capturing foot fall data more comprehensively in comparison to previously used systems. These systems capture and analyse vital information such as demographics (such as gender and age groups), dwell times and areas frequently visited by consumers within the shopping centre. The information is accurate and allows for continued strategic planning from an asset management perspective, using shopper insights to improve leasing and marketing strategies.
In an age where consumers are demanding uninterrupted connectivity on the go, the availability of free Wi-Fi at shopping centres has become vital in enhancing customers’ shopping experiences, providing accessibility to sales and other promotions within the shopping centre at the convenience of their smartphones. Retail property owners and their tenants also have much to gain.
Shopping centres that make efficient use of the data collected through their free Wi-Fi offering are well placed to augment their value proposition thus providing enhanced opportunities for tenants and a superior consumer experience. Through data analytics derived from the information collected such as demographics, consumer interests and frequency of visits, among others, the availability of free Wi-Fi has allowed for the better understanding of the make-up of customers, a pertinent area of focus which can be hugely beneficial when devising business strategies. A study in the UK where 88% of retailers ranked free Wi-Fi as a top tech priority is testament to the intrinsic business value derived from such access.
More so, this data is invaluable for the tenants of property owners, informing a range of decisions from artwork to store layouts to location within the shopping centre, amongst others. It also provides retailers with extended experiential marketing opportunities through the portal, which also makes use of AI, where retailers can direct tailored advertising to consumers based on their specific behavioural data.
The transformation from clicks to bricks
Although online shopping has gained immense popularity, it is not a substitute for the offline experience with studies suggesting that 85%2 of consumers still favour the conventional brick and mortar shopping experience. More and more consumers are ‘window shopping’ online but reverting to the physical store to finalise their purchase. “The bottom line is customers value the personal experience of the physical store,” said Gary Ambrosino, CEO of TimeTrade. We found that shoppers have done their shopping or discovery online, then go into the store to get help with their final purchase decision.
What’s more, in an age of retail convergence (which involves merging digital and physical retailing), cross-channel strategies are not limited to what could be deemed a conventional offline business. Increasingly, traditional online stores are also embarking on bricks and mortar ventures, indicating the importance of a tactile experience of physical stores. A growing trend of online retailers investing in bricks and mortar has been seen lately with online stores establishing their physical stores to enable them to provide complementary experiences and effectively respond to the complex needs of today’s consumer.
Resilience through disruption
Disruption continues to take global markets by storm and businesses that do not invest in the right technologies, innovation and approaches are destined to stagnate. For retail property owners the opportunity to rethink retail spaces is an exciting one which should be embraced. The right blend of technology, data and foresight can provide a competitive advantage to the property owner and the various outlets, enabling its resilience into the future.
Author: Jonathan Sinden
Source: SA Property Insider
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