Today, it is expected that by 2022, the retail sector will add 39 million square feet of space in India. The success of mall culture in India can be gauged by the fact that bigger malls, like the Phoenix Market city mall in Mumbai which has an area of 4 million sq. feet (considered to be the biggest mall in India), are coming up at an enhanced frequency. The top 10 malls in India collectively occupy around 22.5 million square feet of retail space.
The next five-six years from 2002 went well for the synergy between the retail sector and real estate. The year 2007-08 saw a huge growth rate in mall space coming up all over the country. India was hit by recession in the dusk of 2008 which in-turn hit the retail sector as well. Mall culture witnessed a slowdown and mall mania became mall trauma. The tide had truly turned low for developers and retailers, who had blindly jumped into the mall business without understanding the demographics and demand. From Gurgaon to Ahmedabad, the mall culture was witnessing a downslide.
The Indian retail real estate market is only a decade and a half old and in this short time it had already gone through a difficult phase. The downtrend did teach a lot to the developers as well as the retailers. The conceptualization of a shopping mall was not like building a residential or commercial building and hence, professional assistance became essential. Some other attributes which had contributed in this catastrophic story were multiple floors, high vacancy rates, unviable locations and poor commercialization. The tide again started flowing towards the mall culture from 2011 onwards.
Retail-Real estate synergy started seeing its uptrend in metro cities from 2012 onwards. Consumers’ outlook towards the malls had changed from a place of spending leisurely time to a place for shopping over the decade. With the advent of eCommerce in 2014, the malls again started anticipating competition and as a result, strategies to attract customers got more creative.
At this time when shopping malls are struggling to escape the vice like grip of the economic slowdown and survive the onslaught of eCommerce firms, Select CityWalk – Delhi, High Street Phoenix – Mumbai, and Express Avenue – Chennai are bucking the trend. Select CityWalk is clocking sales of INR 2,750 per square foot per month. High Street Phoenix does about INR 2,200 and Express Avenue about INR 1,400. A mall is considered to be performing good if its average sales are between INR 900 – 1500 per square feet per month.
One of the factors that contribute to the success of the mall is “Mall Management”. Malls must go that extra mile to cater to every need of their customers. Thus the need for managing malls effectively and efficiently through SOPs (Standard Operating Procedures), is becoming the urgent need of the society and business as a whole.
The mall managers must strive for effective operations and maintenance of the entire building, infrastructure; including the services and utilities and ensure that they are used in a way that is consistent with the purpose for which they were built.
Further, mall management also helps in finding the right kind of tenants, while leasing out space to tenants.
Mall management has been identified as a critical factor for the success of malls and the retail industry across the world. Mall management broadly includes mall positioning, zoning, tenant mix, promotions/marketing and facility/finance management.
Another important factor to be considered is the Mall Layout & Customer Walk Flow Management. To be ahead in the race of attracting people and creating uniqueness, malls must focus on creating a layout which gives maximum visibility to the tenants, providing them with ample display space, tactfully & technically using the dead spaces, and creating focal points to attract the customers.
As malls are turning to community centres, it becomes difficult for the mall managers to control the vast number of visitors. Mall entry doors cannot be closed for visitors/shoppers simply because of having large crowds. Thus, mall developers must consider this aspect while planning for a mall.
Traffic management includes managing foot traffic into the mall and parking facilities. Foot traffic management involves crowd management inside the operational area of a mall. The flow of people depends on the design of the mall and the spatial distribution of its tenants. For example, a star-shaped mall tends to have a problem of crowding in the centre of the mall, as everyone has to pass through the centre while moving from one side to the other. For instance, circular malls, as compared to usual malls, usually do not face the problem of traffic congestion because these designs tend to have better pedestrian flow and less jamming. Managing parking facilities includes provision of ample parking and management of vehicles in the parking lot.
Branding & Advertising is one of the latest trends in the retail mall game where vacant spaces are now being used for advertising and promotion. This can often be hi-tech involving the use of digital displays to draw the shoppers’ attention to specific merchandise or promotions in a nearby store. These new promotional efforts, like corporate responsibility, add to a retailer’s cache and represent a genuine marketing advantage to the luxury malls in India.
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