The popularity of shopping centres may have already been suffering before a global pandemic hit but thanks to Covid they saw declining visitor numbers suddenly plummet to zero throughout the numerous lockdowns and restrictions of 2020. As these vast buildings are finally allowed to re-open in England this week, online sales can boast unprecedented 36% YoY growth leading some to suggest the future of shopping centres is hanging in the balance.
Some may argue the announcement last summer of retail property giant intu going into administration came as no surprise, and yet other investors still have confidence in the demand for tangible shopping experiences. Cale Street Partners and CPP Investments have both swooped in to save iconic sites like the Trafford Centre in Manchester, but the question still remains whether shopping centres have a place in a post-pandemic world.
A diverse offering
A study published by Savills shows a diverse offering of retail, leisure and hospitality outlets can help to encourage and extend visits to shopping centres. To guarantee its survival, it is vital to enhance the shopping centre experience beyond a transactional process and explore options that will extend the dwell time of shoppers at retail outlets.
Full day experience
One shopping centre owner who is aiming to do just this is Cale Street Investments who recently acquired full ownership of a shopping centre in Derby and have outlined how they plan on “building on [their] existing offer, creating new and exciting experiences for visitors to enjoy, with Derbion offering people everything they need for a vibrant day out in the heart of the city.”
However, new offerings must be carefully considered to target the desired shopper demographic. Whereas Generation Z may already consider long trips to shopping centres as an enjoyable pastime, studies have shown that Generation X do not view shopping centre visits in the same way, yet it is this generation that typically has the highest average spend when they do frequent shopping centres, according to Savills research.
In order to encourage greater time being spent at shopping centres by the more profitable demographic of shoppers, it is vital to adapt to changing consumer culture and recognise their priorities. Shopping centre owners must take a holistic approach to improvements as Covid restrictions are reduced and consider new offerings that will enhance the experience for all members of the family. They must also review how shopper groups travel to their sites and recognise key changes they could make to accommodate longer stays at the shopping centres.
It has been established that the Gen X demographic recognise convenience and accessibility as key factors in determining their decision to visit a shopping centre. According to research from 2020, Gen X are buying the most EVs, with 39.8% market share. Using this information, the installation of EV charging points could be a direct example of demonstrating a key understanding of their consumers by providing the convenient benefit of dedicated EV parking zones and charging stations. Such a move can help improve shopping centre facilities to suit the lifestyle of their target shoppers.
As another reason to consider installing EV charging points, with visits to the shopping centre expanding into a full day experience, the sites become an ideal location for destination EV charging. Bigger out of town shopping centres typically have higher dwell time therefore by creating a full day experience at the shopping centre, EV owners can benefit from this time with extra charging. By providing more activities on-site and the added benefit of EV charging as an additional service, it further helps to extend dwell time.
Spending time, spending money
Dwell time improvement correlates positively with the average spend per visit, meaning the highest dwell times in shopping centres attract the highest spends. By providing benefits targeted at Gen X shoppers, it is likely to encourage greater dwell time, increase spending and offering enhanced satisfaction with their visit.
Shopping centres have faced significant challenges over the past 12 months, but their future still hangs in the balance. As shopping centre owners seek to change visitor perception to a full day trip, they must be mindful of their target audience. Enhancing the offering within shopping centres must improve their long-term commercial viability and recognising added benefits which attract their targeted shopper demographic will prove essential in keeping the doors open.