Asian shopping malls becoming multifunctional spaces

Asian shopping malls becoming multifunctional spaces
Malls in Asia are adapting to the threat of e-commerce by providing facilities the internet can’t offer, such as entertainment and dining.
 
In Singapore, major shopping centers have added gaming, teaching and sports facilities to entice consumers. 313@Somerset, a modern, multifloor mall, introduced a cosmic bowling alley with an array of entertainment offerings, such as darts, karaoke and arcade games. Suntec City has added an indoor activity park with multiple game options, while the upcoming Funan mall, set to open in mid-2019, will offer a culinary school as well as facilities for rock climbing and soccer
 
“The sea change turning shopping centers into multi-experiential retail destinations continues,” stated Savills World Research (Singapore) in a report, adding malls were filling up vacant units with “more activity and entertainment-oriented tenant mixes. This not only keeps occupancy levels up but also leads to greater footfall traffic.”
 
Making a mall a destination for more than just shopping is central to AEON’s Sen Sok City mall in Phnon Penh, Cambodia, which opened in May last year. The mall contains a water park, an aquarium, a concert hall and offices for passport issuance and driver’s license renewal, with AEON saying that these amenities offered a much higher level of service for customers and made the mall a leader in anticipating future market needs.
 
The firm has utilized the same strategy at its Jakarta Garden City mall in Indonesia, which features an ice rink, a 9-screen, 2,000-seat cinema complex and a playground for kids, along with over 100 restaurants.
 
Consumer satisfaction has been positive, so much so that online retailers are now venturing into traditional brick-and-mortar retail. This move makes sense in Asia, given that despite its rapid growth, online shopping still represents a small fraction of total retail sales. For example, the share was just 1.6 percent in Jakarta in 2016, according to Savills.
 
According to Savills, the food and beverage sector, especially fast food, has been a key driver for shopper traffic in Singapore, a trend that is gaining ground in other parts of Asia. Savills noted that in Jakarta food and beverage retailers “will remain the most active player in retail due to the strong demand in this sector from rising affluent customers.”

AI improves customer experience

Retailers can provide an even better shopping experience by utilizing AI. The Capgemini Research Institute found that retailers using AI in customer-facing functions expected the number of customer complaints to decrease by up to 15 percent.
 
Adoption of AI has grown in the retail industry. Over a quarter (28 percent) of retailers are using AI today; a signification increase from 2017 (17 percent), according to Capgemini.
 
Video is an important tool for enhancing customer experience using AI. Facial recognition could help stores identify VIP guests and learn buyer behavior, allowing them to make sale and promotional adjustments to reach business goals more easily, said Jeremey Sea, Senior Manager of Commercial Marketing for APAC at Sensormatic Solutions, which is part of Johnson Controls.
 
Big data can also help to drive sales. Traffic data generated from multiple store sensors can provide vendors with insights into trends and peak traffic periods. “Understanding shopping behavior allows retailers to better manage marketing campaigns to optimize customer in-store experience,” Sea added.
 
Retailers apply AI mostly in functions unrelated to the customer experience, however. According to Capgemini Research Institute, 62 percent of AI implementation aims to reduce costs, with 59 percent targeted at improved ROI. Only 10 percent aims to improve the customer experience, with 7 percent used to address customer pain points. In other words, there is potentially more AI use cases to improve customer experience.
 
About one fourth (26 percent) of AI deployment is operations-based, such as for procurement tasks, detecting in-store theft via image detection-led algorithms, and supply chain route plans. These applications have the potential to help companies make substantial costs savings.
 
Department store Macy’s, for example, tagged every display shoe in its store with an RFID label, and was able to reduce the number of missing shoe styles on display, so that customers had more styles to choose from, Sea said.
 
“The RFID-enabled inventory intelligent solution allows for real-time inventory stock count and faster replenishment of merchandise on the shopping floor,” Sea explained.


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