Posted by: James Brown
Head of EMEA Retail Research
Jones Lang LaSalle EMEA Research
We met with asset managers of one of the UK’s leading landlord with over 1 million metres sq of prime floorspace – To hear their concerns over the challenge of multi-channel, how to create ‘experience’ in their shopping centres and what the future means for in-store payment methods….
Here’s what they said:
1) The irreplaceable retail space
Quite simply, you can’t always transfer the shopping experience to online. It was emphasised that for a large majority of products, individuals want to try things on, like to feel the quality and ensure the product meets expectations. However, with generally lower internet prices, does this mean shop spaces will become solely showrooms? If this is the case, making sure the store is stocked with every perceivable could cause problems for the space planners.
2) Internet vs Store price wars
Internet prices are typically lower than in-store. Empowering staff to react to flexible pricing and offer that extra level of service should be the best way to keep people shopping in shopping centres and outweigh the cost benefits of shopping online.
Online growth means offline will have to offer something more. Whether it is using a theme, mood lighting, loud music or hands on activities, shops and shopping centers have to become entertainers. Shopping centers will therefore need to review their tenant mix and non-retail provision to provide an experience the internet simply cannot replicate.
4) A changed perception of space
Whilst in-store experience highlights differentiation from internet shopping, retail space will also have to adapt to incorporate e-commerce as an alternative response. There’s no fighting it – online retail will continue to grow! As delivery and returns for internet shopping is still an issue, stations to accommodate this in shopping centres may be the answer – it could actually help bring people into the shopping centre as well just enhancing the service offered.
5) Payment reconsidered
As cheque books are being phased out, and the cash-lite society develops further, payment will soon be at the touch of a card – or scan of a basket. This will appeal to the consumer and to retailers. Shops are likely to re-think the use of checkout space, which could mean sales areas will expand, or space for improving store experience is created.