With provision of more entertainment options in malls, retailers are able to increase their sales  Until recently, street markets and bazaars were the top performers in the retail space and contributed immensely to retail sales. However, at present, traditional markets have to create a better overall shopping experience for potential shoppers by offering a mix of diverse product basket and food/beverage/entertainment, preferably under one roof, like malls do. A consumer is attracted to a mall as he gets world-class services, exposure to various brands, promotional offers and big discounts during festivals. Added to this is the ease of shopping in an air-conditioned area with comfortable seating arrangements plus food joints.
Strategies to be implemented
Rising competition has made mall developers focus on core competencies and make correct offerings to target customers. Mall developers first attempt to understand the shopping needs of customers in their targeted ‘catchment’ areas and then build a well-planned portfolio of retail options that can cater to needs of those consumers. Post-recession, retailers have become a lot more vigilant in terms of expansion and evaluate profitability of each location much more carefully than ever before.
A few business strategies can be penned down for running a mall successfully.
Zoning-formulating the right tenant mix and its placement in a mall – Different retail stores occupying space in a mall is called tenant mix. Mall space is divided into different zones for placing various retailers, which is called zoning.
Sustainable revenue model – Mall developers should not only concentrate on fixed rental but develop innovative models where both retailers and developers would be able to earn profits. Working out a pure revenue sharing model with a minimum guarantee is one of the most favourable practices at present.
Promotions and marketing – Events that would help to promote the companies are essential aspects of mall management. Some of these include food festivals and celebrity visits that increase foot falls and in turn sales volumes. Organising cultural events has also proved useful. Developers can plan out certain marketing strategies for individual malls in order to meet the requirements of local consumers and the challenges of local or regional competitors.
Mall management – It refers to combination of people, place, processes and technology in a particular building. It also means best utilisation of resources in order to cater to the requirements of the organisation. It largely consists of three aspects, namely infrastructure, ambience and traffic management.
Infrastructure management – Infrastructure management refers to management of facilities provided to tenants as well as undertaking risk management measures such as adopting essential safety measures, conducting asset liability and environmental audits as well as imparting emergency and evacuation training.
Ambience management – It consists of management of the overall appearance, which is necessary in every mall.
Traffic management – It refers to managing the crowd, which is inside the premises as well as in the parking zone.
Road ahead
Until very recently, most Indian developers used to consider mall management as equal to facility management. The realisation that these two concepts are different and that professional mall management has immense bearing on the long-term viability and success of a mall is gradually being accepted. Developers should adopt professional mall management practices in order to attain success.
Lt Col (Retd) Ashutosh K Beri, managing director - property and asset management of Jones Lang LaSalle Meghraj (JLLM), a global real estate firm based in Mumbai |
