The Evolution of Shopping Malls

Tan Sri Eddy Chen

BY TAN SRI DATUK EDDY CHEN

 

Gone are the days when shopping malls are purpose-built retail centres that offer a number of specialty retail lots with shared amenities and services like air-conditioning in common areas, and car parks.

A host of global trends have caused malls to change the role they play in people’s lives. No longer are they just about shopping, they  seek  to offer experiences that go well beyond that.

Shopping malls have evolved to be a multi-purpose destination, with new ones offering even more variety, just to be fresh and different.

In Malaysia, as elsewhere, there  is a vast variety of shopping malls, with variations in merchandise and services, size and layout. But developers are ever creative and have since produced malls with unique and imaginative offerings to attract shoppers.

Lifestyle activities

With the varied offerings available, visiting a mall has become a lifestyle for all Malaysians,  regardless of age or sex, particularly during  weekends and holidays.

A whole gamut of goods and services can  now  be  found  in  malls  offering a total  lifestyle activity. They include retail and service outlets, food and beverage in many imaginative  formats, sports and leisure activities like fitness centres, bowling alleys, and futsal and badminton courts,  entertainment like cinemas, theaters, karaoke  and theme parks, spa and beauty centres, one-stop payment centres,  car wash and service workshops,  and educational and trans- port hubs.

With shoppers becoming more affluent,  the trade  mix in malls has to constantly adapt  – shifting from bread- and-butter goods and services towards more lifestyle merchandise and leisure and health products.

Shopping in  a mall  used  to be  a “self-service” activity, that is, shoppers either  go window shopping or directly to purchase merchandise and for some food and drinks on their own. But now, malls  have  evolved  to provide  more sophisticated services, simply to pamper their shoppers.

Concierge desks

The ordinary  information counters are now called concierge desks, reminiscent of hotels, providing not just the shopping directory but customer care in the form of mall ambassadors who may be profi- cient in foreign languages like Arabic to assist in the annual Arab shopping spree here.

Urbane city centre malls also provide personal shoppers (in addition to those at department stores) to advise on retail offerings within the mall.

Some malls offer shopper privilege cards which come with preferred access to club premises where shoppers may relax while waiting for their companions to finish their retail therapy.

Safety and security in malls’ car parks have  already  gone  one  up  with valet services, car-bay locator apps, specially designated ladies’ parking, buggy/shuttle services and even security escorts for the faint-hearted.

In view of the enhanced multi-pur- pose  functions of a  shopping mall, the traditional box format has evolved from being merely functional to being experiential with outdoor and  indoor landscape features, friendly access points and  connectivity to public  transport, multi-volume ceiling space and special lighting to enhance the luxurious feel.

The non-boxy mall formats now include  strip layouts as in Citta Mall in Ara Damansara, shops located  around a semi-indoor garden  courtyard like in Empire Damansara in  Damansara Per- dana, and even a full-scale roof garden with exotic flora as in 1 Utama Shopping Centre in Bandar Utama. The three malls are in Selangor.

Experiential rather than  functional

With the advent of smart devices and the digital era, the usage of wireless internet networking (WiFi) has become an essen- tial service in shopping malls. Shoppers are seen indulging  in social media  via their mobile  phone, tablet  and  laptop while they shop or eat.

There  are many  who spend  much time digitally and  simply like to share their eating and shopping experience in real time.

In response, malls and  businesses have turned to social media  to reach out to potential shoppers with real-time offers and discounts.

Since the first standalone mall opened in the 1970s, malls have become an essential component in any mixed development.

Apart from hypermarkets, malls are seldom built standing alone and co-exist with full connectivity within the synergy of other components like hotels, offices and residences.

In addition, due  to today’s greater connectivity, malls have to compete for tourism dollars.  Tourist  shopping has grown significantly to comprise almost

30% of total tourist  expenditure in the country. So it makes sense to leverage on the synergy and integration with hotels and transportation hubs.

Recently opened malls like Nu Sen- tral in KL Sentral  and  Gateway@klia2 are built around the central rail hub and airport, respectively.

Mall ownership has  also changed from the traditional entrepreneur set-up of private or family owners  to become institutional like  REITs (real  estate investment trusts) where the general public may purchase shares  through a trust fund.

Some of these are Sunway Pyramid, Mid Valley Megamall,  Pavilion  Kuala Lumpur and CapitaLand malls through- out the country.

REITs in popular shopping malls are particularly good investments which do not require a big outlay. In other words, shoppers may feel proud  to patronise a prominent and well-performing mall in which they have invested or “own”, albeit a very small part.

We also see chain malls in Malaysia, a vast progression from the single mall operator to big chains like Giant hyper- markets, AEON malls or Tesco malls.

Malls owned  by REITs are usually chain malls as they benefit from economies of scale for marketing and operations and the group as a whole can achieve strong branding.

Looking ahead, the trend is premium outlets. All this started in December 2011 with  Johor  Premium Outlets,  a joint venture with Simon Property Group from the US, with just 70 shops. Today, it has expanded to 130 shops, catering to local and foreign tourists.

The second premium outlet  in Malaysia, Mitsui Outlet Park, opened in May close to the KL International Airport (KLIA) and klia2.

More outlet malls

More such outlet malls are in the offing. They include  KL International Outlets (KLIO) in Dengkil, near KLIA; Genting Premium Outlets,  Genting  Highlands; Penang   Designer   Village; Freeport A’Famosa Outlet Village in Alor Gajah, Melaka and Sunway Ipoh Premium Outlet.

These malls cater to a slightly differ- ent group of shoppers simply because of their location far from the city centre. With their  proximity  to airports, they attract both domestic and foreign tour- ists during flight transit.

Shoppers keen  to  enjoy  bargain prices for branded merchandise which are slightly behind season  would also make a beeline for these outlets.

The mall industry in Malaysia has not stopped growing, with several malls opening each  year, but it will become increasingly competitive as every mall strives  to attract  both  shoppers and retailers of their choice.

Prime  and  established malls  will continue to enjoy high occupancy but need to remain competitive at all times for continued success.


Tan Sri Datuk Eddy Chen is the President of Malaysia  Shopping  Malls Association (Persatuan Pengurusan Kompleks Malaysia)