Walk into a mall on a Saturday afternoonÂ and chances are, that darling outfit youâveÂ been eyeing has been snatched and there is aÂ queue a mile long for the fitting room. Or youâreÂ fighting for just a sliver of a second to step inÂ and have a conversation with the tech expertÂ on the latest wearable. He, on the other hand,Â remains distracted by five other customers justÂ like yourself, all waiting to talk to him.
Now come back to the same mall again onÂ a Wednesday afternoon. It is a different story.Â The mall is now a ghost town.Â This is no breaking news â we all know theÂ retail marketing arena is and has over the years
been facing a challenging time. Rentals remainÂ sky high and the competition is stiff with a denseÂ number of brands in a single area.
While mallsÂ may seem packed on weekends, is it enoughÂ to cover for the vast emptiness of weekdays?Â Last year in Singapore, several iconic mallsÂ such as Funan DigitaLife Mall and OrchardÂ Central found themselves in a need to revamp,Â presumably, in a bid to win back consumers.
CapitaLand Mall Trust ManagementÂ Limitedâs (CMTML) Funan DigitaLife, knownÂ to be an iconic mall for gadgets and all thingsÂ digital, situated in one of Singaporeâs busiestÂ districts, said it would be morphing into anÂ âexperiential creative hubâ.
Without explaining further, CMTML claimedÂ the retail space would be used as a collaborativeÂ platform to connect retail, cultural, learning andÂ business opportunities, and play a big part inÂ the rejuvenation of the Civic District.
As for Orchard Central, Mavis Seow, chiefÂ operating officer of the retail business group atÂ Far East Organization, owners of the mall, toldÂ Marketing the space would be reconfiguredÂ to include new escalators and walkwaysÂ to âoptimise accessibility and improve theÂ shopping experienceâ.
There is no doubt the shopping experienceÂ today is no longer what it used to be, even justÂ five years ago. All this, coupled with the boomÂ of e-commerce, has led to retailers facing cut-throat competition.
The problem of declining footfalls is notÂ confined to Singapore alone, but is a globalÂ phenomenon, explains Amy Kean, the regionalÂ strategy lead at Mindshare APAC. These daysÂ putting the customer first means something totally different than just a few years ago.
Where once it was about specialist skills,Â efficiency, remembering a customerâs regularÂ purchase or even knowing their name, now theÂ market is led by competitive value and offeringÂ that âwowâ factor that so many shoppers areÂ starting to demand.
There have also been a number of recentÂ disruptors in the market seeking to redefineÂ what the term shopping means in Singapore.Â Today, shoppers are placing a greater focusÂ on the experience and added value rather thanÂ the straightforward transaction that manyÂ outlets offer. Hence, modern retail needs to beÂ all about the experience.
Experiencing the space
In a dense and cluttered market such asÂ Singapore, the correct usage of space andÂ maximising the mall space is vital.Â âModern retail needs to reflect the earlyÂ conceptual showrooms introduced by IKEAÂ and Apple, but on a smaller scale,â Kean says.Â She explains the concept of showroomingÂ is starting to take off, but itâs still very early days.
The PACT space at Orchard Central is oneÂ such disrupter, with the store claiming to beÂ responsible for changing the local landscape by Â challenging and reinventing traditional notionsÂ of retail in Singapore. The PACT defines itselfÂ as a âdestination emporiumâ and a network ofÂ spaces and cross-over interests rolled into oneÂ retail and F&B experience.
âEvery single one of its retailers focuses firstÂ on customer experience and this model is set to
increase in Singapore over the next 24 months,âÂ Kean says.Â Soon, she says, we will be seeing fashion
retailers with blow-dry bars, furniture storesÂ with artisan coffee shops and even toy storesÂ with tech-powered augmented reality gamesÂ and shows.
âIn an over-saturated market and an onlineÂ ecosystem that thrives on value, itâs gettingÂ harder and harder for retailers to stand out andÂ get regular custom â providing your customerÂ with an extra personalised experience couldÂ be the difference between flash in the pan andÂ long-term loyalty,â she says.Â Chris Martell, managing director ofÂ Geometry Global, says the role of a store hasÂ now evolved to a point where it needs to keepÂ up with shopper expectations and behaviour.
And while one recipe may work for one retail area, it is important to note that all retail outletsÂ should not have the same treatment. Even ifÂ itâs the same brand, there should be points ofÂ differentiation to ensure customers are visitingÂ the other outlets as well.
Giving the example of Orchard Central,Â Martell explains the mall space has theÂ opportunity of Â improvement, seeing howÂ architecturally, its corridors, sight lines andÂ ceiling heights are more constricted than otherÂ malls.
âMore open, fluid spaces attract the strollingÂ shopper,â he says, adding that Orchard CentralÂ stores also tend to be more transactional withÂ ample opportunities to improve on all fronts,Â including size, visual merchandising and staffÂ and customer interaction.
âThese less-than-satisfactory traitsÂ push shoppers to seek out more engaging,Â experiential spaces,â Martell says.Â As for Funan DigitaLife, he is of the view thatÂ even though Funan is an old mall, the shoppersÂ visiting Funan are usually there to âdeal huntâ.Â âFunanâs weakness, however, is the growth
of online purchasing. Once lower prices can beÂ found online, why bother walking around a mall
at all?â he questions.
No breathing space?
Singapore has long marketed itself as a prime shopping destination. According to theÂ Singapore Tourism Board (STB) shoppingÂ is part and parcelÂ to tourism receipts, comprising 17.5% of totalÂ tourism receipts in 2014.
In 2015, STB also launched a SG$20 millionÂ Golden Jubilee marketing campaign anchored
on shopping and supported by attractive fly,Â stay, eat and play deals to drive conversion and
spend.Â The same year, S Iswaran, the secondÂ minister for trade and industry, said theÂ government would work closely with industryÂ stakeholders to rejuvenate the area and âenlivenÂ and showcase the Singapore lifestyle andÂ cultural precinctsâ.
âWhile offerings in Singaporeâs retail arenaÂ are driven largely by market forces, we hope toÂ see a more diversified retail scene that appealsÂ to a wide range of visitors. From the marketingÂ perspective, STB is profiling more SingaporeÂ designers and products to visitors as a point ofÂ differentiation to increase spend,â said RanitaÂ Sundramoorthy, director of attractions, diningÂ and retail at the Singapore Tourism Board.
She added that besides Orchard Road,Â which remains a top visitor attraction, moreÂ and more tourists are now exploring precinctsÂ with distinctive characters such Haji Lane andÂ Dempsey Village. As such, STBâs marketingÂ efforts are also geared towards enabling visitorsÂ to know more about such hidden gems.
Embracing the new
Still, despite the talk of data and the power itÂ possesses, the single biggest challenge retailÂ marketers in Singapore face today is a lack of data and understanding about their regularÂ offline customers. Not enough is known about these consumers, their purchase habits, in-storeÂ journeys and what drives them to buyÂ one brand over another in a store.
âSingapore has one of the most activeÂ commerce populations in the world, and onlineÂ we have a wealth of insight about paths toÂ purchase and baskets, as well as the socialÂ layer of brand love insight that social mediaÂ offers. But itâs within the bricks and mortarÂ stores where the real ignorance lies,â Kean
This is why recent innovations in retail haveÂ included the introduction of beacon technology.
This technology allows shop ownersÂ to interact with and learn about their offlineÂ shoppers, via their smartphones.Â In theory, beacons allow retailers to trackÂ what customers are doing in their store, who
they are, and what products they are likely to buyÂ based on previous behaviours. The technologyÂ also allows retailers to send personalised pushÂ messages to each customer, prompting themÂ to buy a product or informing them of a specialÂ offer.
However, despite sounding like the holyÂ grail, there are currently a few restrictions toÂ beacon technology. For example, customersÂ must have the retail brandâs app downloadedÂ and the bluetooth switched on and theseÂ restrictions can mean that retailers are onlyÂ dealing with a fraction of consumers walking
through their stores.
Mindshare, via its own shopper dataÂ business arm Shop+, has to date experimentedÂ a huge amount with this technology â mostÂ notably with NestlĂ© and FairPrice, usingÂ iBeacons in-store, alongside the FairPrice app,Â to learn about the regular in-store journeys thatÂ customers were taking.
This has helped in mapping out shoppingÂ habits of consumers and serving relevant pushÂ notification messages to them via their phone,Â explains Kean.
âGiven the relatively small amount of peopleÂ that meet the requirements of having the appÂ and Bluetooth turned on, itâs not necessarily theÂ advertising itself that has the most value, insteadÂ it is the learnings you can get from essentiallyÂ watching your customers every day and beingÂ able to start predicting their behaviours,â KeanÂ says.
Once offline retailers begin to understandÂ this, then the future of the landscape inÂ Singapore will be a lot more informed, andÂ relevant to the shopper.Â Regardless of its struggles, traditional retailÂ is here to stay, says Mahesh Neelakantan,Â founder and CEO of specialist shopperÂ marketing agency in Malaysia, Newton â TheÂ Activation Company (TAC).
âIt may need to reinvent itself to integrateÂ digital and data-driven marketing to improveÂ delivery, efficiency and customer experience,Â but there will be clear spaces for both onlineÂ and offline retail to exist,â he says.
Going forward, pop-up retail is an areaÂ that will become more mainstream with brandsÂ using it as part of their mix, he predicts.Â Echoing Keanâs views, he adds thatÂ areas such as beacon usage, mobile first and
mobile wallet and integrating digital technologyÂ to aid conversion and purchase, will no longerÂ be a ânice to haveâ, but vital for any retailÂ marketer.
Other recent challenges facing retail isÂ the perception of online being cheaper thanÂ traditional retail. In some categories, especiallyÂ luxury, fashion and consumer durables, peopleÂ are browsing through brick and mortar storesÂ for the âtouch-and-feelâ experience and humanÂ interaction, only to head online to get theÂ cheaper deal.
âThis temporary trend is largely owingÂ to large online stores armed with VC moneyÂ â buying market share at the expense of theÂ traditional store. If the industry sees retail moreÂ as a brand rather than a channel â then theÂ future is very bright,â he says.