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Shopping centres have an ongoing role in the future of retail, writes Sue Shepherd of London Designer Outlet

At #RetailEXPO19 in April, you may have seen me on a panel discussion about ‘new spaces and experiences for retailers – the role of shopping centres in the future of retail’. Our industry is going through an interesting evolution presently and customers – or ‘guests’ as we prefer to say at LDO – must remain central to our thinking.

We say ‘guests’ because, like the hospitality sector, our aim is to look after all our visitors, irrespective of whether they have walked from a home nearby or flown in on a long-haul flight. Not only in a shopping mall, but also an outlet centre or a market town high street, the focus is now on guests wanting to do more rather than buy more.

Having said that, of course, we still want shoppers to shop. Many in the retail industry are under serious financial pressures, and an evaporation of revenue helps no-one. Indeed, like most outlet centres, we have revenue-based rents creating a symbiotic relationship where both businesses benefit during good times and both look at new ways to boost trade during more challenging times.

In my view individual destinations must consider three specific variables: overall footfall, dwell times and spend per head.

Around the breakfast table, families rarely limit themselves only to shopping when deciding where to spend a day. The choice is much wider than that: the cinema, the beach, online gaming, a visit to friends and a plethora of other alternatives. We must be at our best to compete and grab the attention. That means excellent and genuine customer service, both in the malls by the landlords’ teams and in each of the stores by the retailers’ staff. The weakest link in the chain can upset a guest, ruining their day, guaranteeing a non-return and yielding a bad review on TripAdvisor. Although we have the advantage over internet shopping by providing an experience, we cannot waste that chance. That’s why our aim must be to attract guests from further, give them reasons to stay for longer and encourage them to visit more often.

Getting guests to our destinations is one thing; getting them to stay for longer is another. Research by Path Intelligence shows a one per cent increase in dwell time results in a 1.3 per cent increase in sales. This connection gives us a solid incentive because of “guests wanting to do more”.

Experiential events are one way. In today’s Instagram world, a memorable day is judged by the number of ‘Likes’ a social media picture gathers. At LDO, we have celebrated Chinese New Year with dragon dancers; and provided deck chairs, ice cream and a giant screen for Prince Harry’s Royal Wedding.

Together these initiates mean we have succeeded in growing footfall at a time that other retail destinations have seen theirs fall. But the number of visitors is not the only key measure; spend per head is important too. For example, we became the first UK shopping centre to offer Dropit, the app-based, store-to-door delivery service. This hands-free service means guests can continue their days without the need to carry shopping bags. The smartphone-based service was introduced to boost revenue for LDO’s retailers. Around Easter, average spend per head amongst LDO’s Dropit users was almost five times greater than by other guests, demonstrating the benefit to brands of the initiative.

Indeed, home delivery services like this combine the best of physical and digital shopping. CACI research shows, nationally, 85% of spend still touches a bricks-and-mortar store. With returns from online shopping five times higher than in-store, it confirms that customers still prefer to touch, test and try items before they buy. By introducing delivery, we can bring together the appeal of major retail brands, year-round outlet prices and hassle-free convenience.

With the growth of ‘shopcationers’, for shopping on vacations, this convenience is essential. Who wants to waste precious holiday time on problem-solving, or arriving at a retail destination to find a barrier due to religious, cultural or language differences? Reflecting the diversity of our guests, we have embraced several cultural initiatives, from fluent foreign language speakers in LDO Guest Relations, including Mandarin, and providing cultural awareness training to tenants’ staff, to Halal and vegetarian dining options in our many restaurants and cafes.

In considering the future role of shopping centres, I suggest there are three significant variables: overall footfall, dwell times and spend per head. To maintain visitor numbers, we need to be at our best to attract guests who have numerous other choices to fill their days. Once they arrive, we must provide excitement and entertainment to ensure they want to stay longer. Through hassle-free experiences, guests can enjoy the choices in the shops, ensuring the future of retail.

Sue Shepherd is centre manager for realm at London Designer Outlet (LDO) in Wembley Park

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