Malls Use Mobile to Boost Visitors

Malls Use Mobile to Boost Visitors

The world’s biggest mall owners are looking to mobile and online shopping technology to boost visitor numbers and fight against growing vacancies, as online shopping increasingly impacts brick-and-mortar stores.

Mall owners like London-based Hammerson, Indianapolis, Ind.-based Simon Property Group and Australia-based Westfield group are all experimenting with digital technology, in attempts to gather invaluable demographic information for increasingly picky tenants and to encourage shoppers to visit stores.

The move to incorporate mobile technology into the mall experience comes as online shopping becomes the norm among consumers. Once they go online, retailers can reach more customers with fewer stores, which makes them much more selective about choosing leasing spaces and locations. The result has been a slow decline of retail rentals in malls, which erodes revenue and property values.

Hammerson, for example, reported a nearly flat profit of $114.3 million in the six months up to July.

To reverse this trend, Hammerson plans to use software at its U.K. malls to track visitors. This will allow them to capture and analyze foot traffic to give its retailers valuable information about consumers’ shopping patterns. Westfield Group has set up a virtual mall, and Simon Property, the biggest shopping center landlord in the U.S., is developing mobile-based shopping apps.

“The big beasts of the jungle are showing that they are alive, ready and willing to embrace these trends,” said Joshua Bamfield, director of Newark, England-based Centre for Retail Research.

Because location is proving to be such a sticking point for mall tenants, Hammerson hopes collecting information on customers’ shopping habits will help them to create mutually beneficial clusters of stores within shopping centers. The group will test software developed by Path Intelligence to track visitors’ movements around a mall using the signal from their mobile phones, although they are careful to emphasize that no personal information will be collected.

“There is nothing ‘Big Brother’ about this,” said Lawrence Hutchings, Hammerson’s managing director in charge of retail, to Bloomberg. “It has nothing to do with personal data. It’s just the signal.”

Beyond offering tenants valuable demographic information, some mall owners are focusing on shoppers themselves to drive traffic to their stores.

Simon Property last year used the “Shopkick” app to alert its mall visitors to retailer promotions, sales and coupons, complementing Simon’s mobile shopper club. Using apps to drive sales is catching on, and Paris-based shopping center landlord Unibail-Rodamco will test a rewards-incentive smartphone application based on visits to Amstelveen shopping center in the Netherlands.

As more large-scale mall owners catch onto the explosion of apps with consumers, this “clicks and bricks” strategy will likely take off, especially as retailers, mall owners and location-based services like Foursquare partner to drive sales.

Other mall owners are creating online shopping destinations to compete. Westfield in November opened an online virtual mall serving Australia and New Zealand that gives shoppers a price comparison tool to search for goods and services offered by 130 retailers. The service provides a single checkout, streamlining the shopping process.

To spark interest, Westfield signed up online retailers that aren’t already its tenants and provided some international retailers with their first commercial presence in the Australasia region.

Beyond increasing vacancies, brick-and-mortar businesses of all sizes also contend with higher property taxes, a struggling economy and growing energy costs. Ironically, retail failures have likely accelerated the adoption of technology into their consumer strategies, and even small-scale and locally-owned stores are using apps, social media and other forms of new technology to stay afloat. Consumers will likely benefit from increased ease-of-use and convenience, even as retailers struggle for their dollars.

“Everyone’s going to get into this area,” Bamfield said. “We can only see 5 percent of what’s possible.”

I Want More Stuff Like This!

Sign up to our daily e-mail and see why technology matters. See Sample.

Like Mobiledia On Facebook!

Join our page and add some fun to your feed.

You Might Also Like: