Today, retailers in well-managed malls have an exciting new opportunity. Thanks to property owners investing in traffic counting and data analytics solutions to power improvements to their properties, retailers are enjoying the knock-on benefit of rich insights that could help them boost conversions and turnover.
ShopperTrak’s latest market report, Mall traffic data grows mall success in North Americaexplains the opportunities in more detail. It addresses the changing market for malls in the region, showing how mall operators are adapting their offer for the modern consumer, and are learning how to use traffic data to improve their own profitability and better support retail tenants.
Traffic data benefiting mall tenants
Naturally the trend for updating, extending, refurbing and reconfiguring North American malls will be a boon to retail tenants, who rely largely on the look and vibe of a center to attract the necessary visitor numbers to drive their revenues.
Aesthetic improvements and marketing campaigns to increase traffic and dwell time are increasingly being accompanied by investment by the property owner in people counting technology and traffic analytics solutions. This is because landlords want to see a ROI in their new concept centres and marketing spend, so are keen to measure and report traffic, which in turn allows them to structure leasing accordingly.
Collaborate to win
This means a more scientific approach is being adopted, with landlords taking responsibility for traffic generation, keeping track of achievements and building on successes wherever possible. The trend is excellent news for retail tenants, who should see traffic into their stores improve, and will be far better informed about long-term traffic projections, peak trading occasions in the pipeline, and insights into shopper behaviour patterns around the mall.
Even more welcome is the fact that smart leasing managers are beginning to use traffic data and other data sets to assess their portfolio of retailers to understand who is and isn’t performing, and step in with assistance where needed.
Triple Five Group CEO, Don Ghermezian, told MSPMag.com recently: “We are moving towards really pushing our retailers. We look at it as a partnership. Developers in this country haven’t figured out how to generate traffic. They put in marble floors and fill up with tenants. For too long, they assumed people would come. We need to make centers experiential. Visitors expect you to have digital displays, interactivity—features that today’s generation wants to see. We’re going to push (retailers) to do that.”
Bring on the experiences
As our report illustrates, retail tenants will increasingly see mall space given over to community events, catwalk shows, cook demonstrations and pop-ups, as experiential retailing is more widely adopted in both local and large destination centres. Smart landlords will be sure to measure the traffic these events generate, to estimate ROI, and to benchmark the success of activities across a portfolio of properties. Again, if executed well, this is another way for property owned to deliver added value to their tenants, justifying the rents they are charging.
Brian Field, Senior Director, Retail Consulting Practice, ShopperTrak says: “Retailers may balk at these actions as the common belief is that mall traffic is down across the board. While traffic levels are not what they were 20 years ago, today’s shopper is quite different. By capitalizing on the trend to evolve malls to have more focus on experience – not just transactions – the mall operator can demonstrate greater value than the operator who simply leases to who will pay a given rate and term.”
Optimize labor in line with power hours
An easy win for retail tenants in shopping malls that provide data insights, is the ability to tailor their employee scheduling in line with busy and slow traffic times. Mall management and tenants can be fully prepared for known calendar peaks, and able to focus on boosting conversions on key dates. Tenants can be regularly briefed on when to expect weekly or daily power hours, or traffic surges driven by high profile mall events and marketing campaigns.
The more data that is made available, the better prepared all parties can be, which is why the concept of data sharing between landlords and retail tenants is being so carefully considered just now.
Traffic data for future growth
Retailers see the importance of using anonymous customer location-based data to inform decisions about how they configure stores, how they merchandise their ranges, present seasonal promotions, and plan their labor resourcing throughout the week.
When their own traffic and shopper movement flow data is combined with mall traffic data, demographics, weather data, sales data and purchasing power information, retailers can begin to create a really compelling shopping experience for consumers. When Wi-Fi technology and video are factored in, even greater opportunities present themselves
The industry-wide interest in data underpins this trend, with the consensus that the more sophisticated all parties become with data-driven strategy, the more likely physical retail is to survive and thrive.
Contact us today for a demonstration on how people counting analytics can improve leasing models, and boost profitability in your malls.