The Retail Experience in the COVID-19 Era: The Shopping Mall

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THUNDER BAY – Shopping has changed in many ways due to COVID-19. Online shopping, curbside pick-up, and social distancing are all changing how things were in the new reality of the corona virus.

The COVID-19 pandemic has sent unprecedented shockwaves through the global retail industry with devastating effects.

As retailers and mall owners grapple with the repercussions of the pandemic, many are accelerating their business plans, rapidly experimenting with new business models and expanding innovative thinking to find ways to keep malls relevant in the new normal and into the future. According to The future of the mall: Building a new kind of destination for the post-pandemic world, there are five critical changes that mall landlords, retailers, and the entire industry must embrace to protect the sector and keep Canadians coming back into stores.

For some time now, the customer journey has been evolving. It’s no longer simply about visiting a store. It now involves an overall brand experience through multiple channels: having done their research online, customers arrive at the store already knowing exactly what they want. Deloitte’s research shows that these behaviours have likely become fully entrenched during the pandemic. The result: the path to purchase has been altered permanently.

“Now more than ever, landlords and retailers need to work hand in hand in an effort to get ahead of the evolving trends and create a reason for Canadian consumers to return to in-store shopping post-pandemic and have a smooth, stress-free experience,” said Marty Weintraub, partner and national retail leader at Deloitte Canada. “The mall of the future will be a destination that feeds the functional requirements of our lives as well as our need to be social. It will be a thriving community where people will live, work, play, and eat. It will not be your parents’ mall—so much so that we may no longer call it a “mall” at all.”

Mall owners and retailers need to invest in these five key changes in order to survive and thrive in the post-pandemic world and get Canadians coming back in store:

  1. Focus on safety and convenience: The new mall will need to carefully balance consumers’ desire for social interaction with their need for a safe, easy shopping experience. Retailers and landlords need to address customers’ concerns by finding innovative ways to adjust how they organize their stores, interact with customers, collect payment, and deliver products. The key to getting people back into malls will be for owners and retailers to work together to invest in customer safety, and to provide tools and applications that make for a smoother, more convenient shopping experience.

  2. Rethink the role of the store: Given mall foot traffic had fallen by 22 percent in the country’s top 10 malls1 even before the COVID-19 outbreak (2019 vs. 2018), retailers need to reconsider the size and number of stores that will meet their customers’ needs, eliminating poorer-performing stores and focusing on showroom, pop-up locations, and other innovative formats. The growth of online shopping (with 78 percent of consumers expecting online shopping to increase in popularity post-pandemic) calls into question the need for an extensive network of stores. Consumers will no longer come in just to browse; they will arrive already knowing what they want, and the associate’s role will be to facilitate the purchase through an exceptional customer experience.

  3. Make way for the food revolution: As less relevant fashion retailers move out of mall locations, their departure will make room for landlords to bring in an exciting new breed of restaurant offerings. This will feed the consumer’s desire for social experience and will likely become the new anchor bringing visitors to the mall. As a social experience, dining out appeals to all customer segments—and it cannot be replicated online. Smart mall owners are viewing food and beverage venues as the new anchor that will enhance their destination appeal. When it comes to the experience of food choices in the mall, a renaissance is coming.

  4. Embrace technology: Retailers need to take a page from digital-first companies—it’s never been more important to build a seamless and integrated physical and digital brand presence. Customers are increasingly looking for a digitized experience both online and off, enabled by technological innovation at every turn. Malls and retailers need to use digital tools to maximize productivity and efficiency and create a dynamic, engaging experience, such as product testing and simulation using AR and VR technologies, an “endless-aisle” distribution strategy that can deliver in 24 hours or less, pop-up shops to showcase new products both in-person and online, as well as online concierge services, digitized browsing, and virtual fitting rooms.

  5. Become a new destination: Most of all, the mall must become the new meeting place for the community—a multi-purpose destination that offers extensive leisure activities as well as other functions, like office, residential, and cultural amenities. Shops should be mixed in with other complementary uses, giving visitors an interactive experience in which the entire environment comes into play. Owners may need to rethink their rental models to allow for different types of retail experiences, such as short-term pop-ups or exhibitions. There is a great opportunity here to be innovative.

The COVID-19 pandemic has served to accelerate changes that were already underway and accelerate innovation among mall owners and retailers alike. Canadian consumers were already starting to change how they shopped, and now they are looking for a significantly better experience that connects the online world to an elevated in-person experience for the long term. The unknowns coming out of the pandemic have added even more variables into this evolution that need to be navigated, such as how long social distancing measures will be maintained as well as the accelerated shift in consumer behaviours.

“One thing is certain: a revolution is coming to our retail experience,” added Weintraub. “It’s clear that the pandemic has changed how people feel about interacting with the world around them. These changes could last long into the future, which means retailers and landlords alike have both a great opportunity and obligation to reimagine the entire customer journey and create a totally new kind of destination that will keep visitors coming back for years to come.”