Notwithstanding the recent pandemic, the meteoric rise of e-commerce has put brick-and-mortar retailers on the defensive. The latter can no longer rely on the mall solely as a shopping destination that will bring in high foot traffic for their businesses.
The oversupply of space in the mall industry, furthermore, has resulted in a fiercely competitive mall landscape, with some observers suggesting that a “retail apocalypse” has left some malls on the brink of extinction.
As of March last year, Malaysia had a total of 1,060 shopping complexes with 17.25 million sq m of space, based on the latest National Property Information Centre statistics.
Against this backdrop, NextGen Theme Park founder Leroy Lee said shopping malls must offer social and entertainment experiences, and not only retail, in order to stay relevant and competitive.
“It isn’t an exaggeration to say that some mall owners and managers are on the brink of a daunting existential crisis,” warned Lee.
The question is how can malls cater to the modern urban consumer?
Positioning malls as an experience
Malls need to transform into an interconnected experience ecosystem, where retail meets social and entertainment.
In order to achieve this, Lee said mall developers need to include high-quality experience as a key element of a mall’s design.
“They need to transform (malls) into mixed-use spaces that offer versatility — a collection of different kinds of activities that are typically not available in a single place or online,” he explained.
Indoor theme parks, Lee suggested, could fill that gap in urban malls through their central attractions such as adult-sized playgrounds, roller coasters, ferris wheels and water parks.
These attractions allow retailers to take advantage of the blurred lines between retail and entertainment. The longer the time visitors spend in malls, the more likely they are to make purchases along the way, he said.
A mall located in a family-friendly neighbourhood could feature a playground or a kid-friendly ride, while a mall located near a university could offer a thrill ride or an escape room, Lee added.
It’s important to note that incorporating a theme park attraction is not a one-size-fits-all solution. The specific attraction should be tailored to the local community and their interests.
Lee noted that the layout of the mall should also be considered before making any decision.
Instead of the monotonous line of shops, he said, malls can incorporate central attractions that are strategically placed throughout the space.
Mall developers can leverage on data or even “beta-testing” with pop-up carnivals or mini theme parks to identify the demography they can target and attract.
This information will help shape their mall marketing strategy and the kind of long-term experiences they want to incorporate into the mall’s identity.