The Reinvention of the Mall: How Shopping Centres are Adapting to Global Buying Habits

The Reinvention of the Mall: How Shopping Centres are Adapting to Global Buying Habits

EXECUTIVE SUMMARY

Retail trends

Shopping as a leisure activity

Foodservice trends

Shopping centre development and performance

Chart 1 Global Shopping Centre Inventory by Region 2013

The mall as a community hub

Diversification

Technology

Factory outlet centres

Sustainability

Outlook

Summary 1 Key Features of The Future Mall

DEMAND FACTORS

Retail Trends

Retail sales benefit from growth in private consumption
Chart 2 Global Retail Sales Growth Versus Disposable Income Growth 2011-2015
Developed markets experience sluggish growth
Russia feels the effects of the Ukraine crisis
China’s retail boom
India’s young consumers drive retail growth
Table 1 Retail Sales by Country 2010/2015

The rise of internet retailing

E-commerce trebles its share
Effect on shopping centres
Chart 3 Global Store-based Versus Internet Retailing 2010/2015
E-commerce soars in China
Table 2 Internet Retailing in Selected Countries 2010/2015
M-commerce is a burgeoning niche
Chart 4 Mobile as a % Total Internet Sales by Country in 2015

Omnichannel retailing

The emergence of the hyperconnected consumer
43% of hyperconnected consumers involve a computer in the shopping process
Shoppers prefer to buy clothing in-store
Showrooming
Chart 5 Frequency of Showrooming 2014
The desire to see and feel products
Chart 6 Reasons for Showrooming 2014
Webrooming
Chart 7 Frequency of Webrooming 2014
Consumers want to have all the facts before going to purchase
Chart 8 Reasons for Webrooming 2014
Competition from virtual malls

The importance of leisure shopping

Consumers have less time to shop for pleasure
Window shopping is a new pastime in China
Chart 9 Favourite Activities Away from Home on a “Free Day” 2013
Chart 10 Shopping as an Away-from-Home Activity by Country 2013
Over two fifths of consumers like to visit the mall
Latin Americans like the security offered by enclosed malls
Chart 11 Attitudes towards Shopping 2013
Chart 12 Respondents Agreeing with the Statement “I Like to Visit Shopping Malls” by Country 2013
Half of US consumers combine mall visits with online

Tourist shopping

The US remains the top shopping destination
Chinese tourists flock to shopping hot spots
Asian cities include shopping in their tourism strategies
Japanese malls step up tourist services
Table 3 Shopping by International Tourists 2009/2014

Consumer foodservice trends

Retail locations take growing share of business
Chart 13 Global Foodservice Sales by Location 2014
Eateries play a vital role in Indonesian malls
Most countries see a rise in retail share of consumer foodservice sales
Malls are the preferred locations for Indian fast food chains
Less focus on foodservice in developed market malls
Chart 14 Retail Share of Foodservice Value by Major Market 2009/2014

SHOPPING CENTRE DEVELOPMENT

Global trends in 2014

US accounts for two thirds of the world’s shopping centre space
11.4 million sq m of mall space added globally in 2014
Chart 15 Top 20 Global Cities by Shopping Centre Completions 2014

North America

Community centres dominate mall landscape
Lifestyle centres gain popularity
Las Vegas saw the most development in 2014
Summary 2 Types of Shopping Centre in the US 2014

Europe

The UK and France have the largest number of malls
German malls are older and smaller
Chart 16 Shopping Centre Density in Selected European Countries 2014
Table 4 Number of Shopping Centres and Floor Space in Selected European Countries 2014
Russia and Turkey drive growth in Europe
Ukraine crisis leaves Russian malls empty
Lifestyle centres are popular in Turkey
Growth stalls in Western Europe

Asia Pacific

Demand remains strong in Japan
China expands the fastest
Seoul, Kuala Lumpur and Manila also highly active
The emergence of mega-malls
India’s malls driven by expansion of international brands

Latin America

Malls seen as a safe haven
Monterrey, Mexico, sees most new mall space added in 2014

Middle East and Africa

The Middle East’s gleaming malls deemed a status symbol
South Africa in expansion mode

SHOPPING CENTRE PERFORMANCE

Malls become more efficient
US welcomes upscale malls
Sales productivity on the rise in the US
Summary 3 Top 10 Malls in The US by Sales Per Square Metre 2014
EU sales reach all-time high
Chart 17 “Shopping Centre-Inclined Sales” in Selected European Countries 2014
Almost two thirds of China’s malls are profitable
Early mismatch between demand and supply
Indian developers also learn from past mistakes

TRENDS AND STRATEGIES

Introduction

The mall as a community hub

A place to congregate
Malls take over the role of public parks in the Philippines
Developers take on board community needs
The growth of ethnic malls

Differentiation and diversification

Greater emphasis on services and experiences
Competing with the online offer
A focus on family entertainment
South Korea promotes the “precious family” concept
Summary 4 Shopping centres Centred Around Family Attractions
Pop-up stores

The drive for convenience

One-stop living
The offer of incentives
Combining grocery with leisure
Integrated developments

The changing role of foodservice

Restaurants replace retailers
Food and drink options are important
Chart 18 Importance of Food and Beverage Availability when Shopping 2015
Swiss and Norwegians spend most on in-mall food and drink
Chart 19 Average Spend Per Visit, All and Food and Drink, by Country 2015
Chart 20 Average Spend Per Visit , All and Food and Drink, by Gender 2015
Chart 21 Average Spend Per Visit, All and Food and Drink, by Age Group 2015
Almost a third of consumers visit the mall just to eat or drink
Chart 22 Propensity to Shop when Visiting a Shopping Centre Primarily for Food by Country 2015
Asian malls have the highest proportion of eateries
Food becomes the new anchor
Making food offer available at different access points
Quality of food increasingly important
Chart 23 Food and Beverage Options that Consumers Would Like to See More of, 2015

Integrating technology into the mall experience

Maximising interaction with customers
The use of QR codes
The rise of beacon technology
Wi-Fi marketing systems
Digital advertising

Stores become showrooms

The emergence of catalogue stores
Internet retailers establish a bricks-and-mortar presence

The growth of factory outlet centres

Appealing to bargain-hunters
US sees resurgence of growth
Factory outlets move into urban centres
Cutting costs to maintain margins
European outlet centres are a tourist draw
China’s outlet malls expand to second and third-tier cities
Summary 5 Selected Outlet Malls Around the World

Sustainability

Green roofs
Japan’s malls offer rooftop gardens

Knowing the market

Baby Boomers drive growth in upmarket suburban malls
Urban developers focus on Millennials
Younger generation are social shoppers
A place for teenagers to hang out
Young people like the personal touch

OUTLOOK

The outlook for retail

Emerging markets will drive growth in short term
Saudi Arabia and India to witness strongest growth
Chart 24 Forecast Retail Sales Growth by Country 2015-2020
Internet retailing will continue to take share from physical outlets
Middle East and Africa markets will remain undeveloped
Chart 25 Forecast Share of Internet Retailing by Country 2020

Shopping centre development

China will continue to dominate future mall development
Dubai gears up to develop the world’s largest mall
Western Europe and the US will focus on overhauling existing malls
France leads pipeline development in Western Europe
Turkey and Russia hold strong potential
Chart 26 Leading Cities for Space Under Construction in 2015

Trends to watch

Convenience, excitement, connectivity, value
Aiming for the prize retailers
Mixed use developments
Outlet malls hold plenty of potential
A greater emphasis on foodservice
Chart 27 Retail Share of Foodservice Value – Top 10 Markets in 2019
Omnichannel is the key to survival for retailers
Personalising the shopping experience
The emergence of robotic technology

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