are retail malls dying?

THROUGH AN F&B LENSE: SHIFTS IN THE FOOD LANDSCAPE

MERRILL PEREYAQSR PROFESSIONAL, AUTHOR, CONSULTANT, MOTIVATIONAL SPEAKER & IDEA GENERATOR

© 2016 Expand Your Brand

WHO AM I?

I expand and commercialize franchise operations, specifically in Quick Service Restaurants (QSR).

Brands include: • Domino’s Pizza (Indonesia)• Healthy Habits (Australia and New

Zealand) • McDonald’s (Saudi Arabia, Pacific Islands and SE Asia).


WHO AM I?

ASIA PACIFIC

INDIA

SAUDI ARABIA

AUSTRALIA & PACIFIC ISLANDS

A strategic and performance-focused executive with more than 25 years of leadership in Asia, the Middle East, South Pacific and Australia.

Expertise lies in leveraging global resources, capabilities and relationships to gain advantage in growing brands in new countries.


WHO AM I?

Whether your business is a small business wanting to grow into new territories, you want to franchise or you want to move globally, Expand Your Brand will provide you guidance and valuable tips on how a business can benefit, avoid the pitfalls and fast track to expanding the brand.


July 1998

ARE MALLS REALLY DYING?

“The retail guys are going to go out of business, and e-commerce will become the

place everyone buys”

– Marc Andreessen, American entrepreneur, investor and software engineer


THE GROWTH IN E-COMMERCE

2014 2015 2016 2017 2018 2019

China 12.4% 15.9% 19.6% 23.8% 28.6% 33.6%

S. Korea 10.3% 11.2% 12.1% 13.0% 13.9% 14.7%

Japan 5.9% 6.7% 7.5% 8.2% 9.0% 9.7%

Australia 5.6% 5.9% 6.3% 6.6% 6.9% 7.2%

India 0.8% 1.7% 2.6% 3.6% 4.4% 4.8%

Indonesia 0.8% 1.4% 2.2% 3.1% 3.9% 4.4%

Other 3.0% 3.2% 3.4% 3.4% 3.7% 3.8%

Asia-Pacific

8.2% 10.2% 12.4% 14.9% 17.6% 20.4%

Worldwide 6.3% 7.4% 8.6% 9.9% 11.4% 12.8%

Note: includes products and services ordered online via any device, excludes travel and event tickets. Excludes Hong KongSource: eMarketer Dec. 2015

Retail Ecommerce Sales as a Percent of Total Retail Sales in Select countries in Asia-Pacific and worldwide, 2014-2019

For the first time, the Asia-Pacific region not only has the largest digital retail market in the world,but its share of global digital retail spend holds an outright majority of the world market.


Alibaba, the most valuable retailer, has no

inventory

Uber, the world’s largest taxi company owns no fleet

AirBnb, the largest accommodation

provider owns no real estate

Facebook, the most popular media owner

creates no content

THE INTERNET IS CREATING PROFITABLE BUSINESSES


MOBILE SPEED CONTINUES TO GROW

5G mobile broadband, set to launch in 2020, will unleash speeds that are faster than 4G and create waves of innovation that will disrupt every industry.


STORES WITH OMNICHANNEL STRATEGIES WILL THRIVE

According to the International Council of Shopping Centers (ICSC) over 198 million shoppers still visited a brick-and-mortar location between November 1 and Dec 25, 2015, despite the 13% growth in online sales during that period.


MULTI CHANNEL, OMNICHANNEL – NOW SOCIAL…..?

Facebook and Twitter’s “Buy” buttons and Instagram’s “Like2Buy” is now creating avenues of shopping through social media.

© 2016 Expand Your Brand Source: Joe Skorupa, Retail trends and predictions for 2015

The need to provide seamless online to in-store experiences continues to grow.

Birchbox’s Soho location offers hair, makeup and nail services in its store.

Urban Outfitters New York City branch has an on-site salon and coffee shop, in a move to turn the location into a destination, rather than just a store.

MORE ECOMMERCE SITES ARE SETTING UP OFFLINE

© 2016 Expand Your Brand Source: Joe Skorupa, Retail trends and predictions for 2015

Aimed at the ultimate consumer convenience, none actually makes food but connects restaurants and customers.

TECH-DRIVEN DELIVERY IS CHANGING THE F&B INDUSTRY


IN-STORE VS ONLINE STATISTICS - USA

78% of customers prefer to shop in-store

Consumers purchase at online retail websites

an average of 2.2 times per month.

Average time spent at a brick-

and-mortar store

54 minutes 38 minutes

Average time spent on a single

retail website

Consumers spend significantly more per

month in a physical store than online

$1,710

$247

73% want to try on or touch merchandise before they

purchase Source: ICSC, Shop Visible© 2016 Expand Your Brand

BRICK-AND-MORTAR STORES ARE STILL BEING VISITED

48% 37% 35%

Of consumers have ordered online and

picked up their purchase in-store

Of use the internet to locate or

research items, but prefer to make

purchases in-store

Of consumers have ordered online and

returned their purchase in-store

Source: ICSC, Shop Visible© 2016 Expand Your Brand

1 in 20 consumers make a purchase after browsing an online store

1 in 5 consumers make a purchase after browsing a physical store

CONSUMERS BROWSING ONLINE VS IN-STORE

Source: ICSC, Shop Visible© 2016 Expand Your Brand

The retail landscape is globalizing and digitizing, and customers are increasingly demanding and in complete control of their shopping destiny.

So how do you stay meaningful while everything around you is changing?

A shift in thinking.

MALLS MUST CHANGE


CONSIDER NEW TECHNOLOGIES & CREATE CUSTOMER ENGAGEMENT

Use Beacon-triggered messages to lure shoppers into retail stores for snacks and meals


USE NEW TECHNOLOGY TO KEEP A SHOPPER LONGER ON THE PREMISES

From virtual fitting rooms to interactive window displays, merchants are continuously finding ways to use Augmented Reality to draw attention and improve experiences.


IF YOUR FORMAT DOESN’T WORK, CHANGE IT

Spain’s shopping mall Las Arenas de Barcelona has been constructed out of a former bullring and is a destination in itself – with views from the roof, the restaurants and a rock museum inside, in addition to the regular retail therapy.

LAS ARENAS DE BARCELONA, SPAIN


CREATE A DESTINATION, NOT A MALL

Westfield Old Orchard in Chicago has demolished its food court and replaced it with a single outlet called Wilde & Greene, incorporating a grocer, supermarket, restaurants and bar.

WESTFIELD OLD ORCHARD, CHICAGO


Provides consumers with lifestyle recommendations from both cultural and technological perspectives.

The store offers concierge services, with every section helmed by an expert in a particular field.

The travel section’s concierge desk books holidays and is headed by a former journalist who has visited more than 100 countries and written several guidebooks.

CULTURE CONVENIENCE CLUB, JAPAN

CREATE A DESTINATION, NOT A MALL


CURATE SHOPPERS LIFESTYLES WITH EXPERIENCES

Restaurants can provide unique social experiences that consumers can't enjoy by clicking "buy" on their smartphones.

DEVIL ISLAND PRISON RESTAURANT, CHINA & A380 FLIGHT RESTAURANT, TAIWAN


Evoke consumer emotions instead of offering ease of purchase. Let online be ‘convenience’ and ‘fast’.

EVOKE SHOPPERS EMOTIONS THAN CONVENIENCE

VOGUE CAFÉ, DUBAI & FRAGRANCE BAR, ITALY


At their Experience Center in Atlanta, Porsche teams an auto showroom with an upscale restaurant called 365.

It looks onto a driver development track.

EVOKE SHOPPERS EMOTIONS THAN CONVENIENCE

PORSCHE, ATLANTA


A hybrid concept between a lingerie store and an automated store/vending machine.

Customers select their lingerie products on large touchscreens/tablets and receive them via transparent aero-propelled tubes.

UNDIZ MACHINE, FRANCE

CREATE EXPERIENCES YOU CAN’T FIND ONLINE


Besides great shopping, Westfield London boasts a phenomenally successful champagne bar, a Flight Simulator and an upmarket teeth-whitening kiosk.

CREATE EXPERIENCES YOU CAN’T FIND ONLINE

WESTFIELD LONDON


ADVANTAGES QSR HAVE IN MALLS

1. Most QSR brands want to scale their brands – and do this fast

2. Building permits and approvals are easier to obtain with malls and shopping centers

3. Foot traffic is higher in malls4. Malls provide easy access to utilities5. Quick and fast set up of the project


The big question is this; is the future of the shopping center actually not about shopping at all?

Perhaps it’s a place you go to meet friends, dine and be entertained in a myriad of ways, and shopping is an adjunct, not the purpose of the visit.

THE FUTURE OF THE MALL IS NOT SHOPPING


Whatever happens, the retail center, like retail itself, will be transformed in the next few years.

It is time for malls to spice up their relationship with customers.

We do not have to kiss the malls goodbye.

WE CAN STOP THE MALLS FROM DYING


Always ask yourself if your efforts are truly providing a more enjoyable experience for your customers.

Stick with that strategy, and you’ll be just fine in the future.

CUSTOMER EXPERIENCE MATTERS


BREAK FOR

LUNCH?

THANK YOU

www.merrillpereyra.com

are retail malls dying?

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