Innovation in the modern retail world
At Satisfi Labs, we work with a diverse group of mall operators across the United States. From the largest mall in the world, to neighborhood shopping centers in California, all of them bring their unique retail experience to life through their properties.
We all know that the malls our parents and we grew up in are long gone; the typical retail model does not work anymore. At the height of their popularity, malls were the center of commerce and interaction – where you would meet your friends, catch the latest blockbuster, browse the stores for what’s new and in-fashion - until the internet revolution disrupted everything.
The good news is that with malls embracing new technology, and experimenting with new tenant mixes, mall vacancies are slowly but surely decreasing. Even so, Q4 2019 showed that mall vacancies are still at about 9%, which is higher than the 10 year average of 8.4%, and puts malls in a tenuous position as the retail industry continues to face challenges from online players. This has led top malls to learn from online competitors and deliver real-time conversational commerce for brick-and-mortar visitors, a feature often isolated to e-commerce.
Here are 3 trends we’ve seen in our work with malls that is driving innovation:
1. Make Experiences King
With our AI-powered Knowledge Management platform, malls have the unique opportunity to gather demand data from the questions that customers are asking. One trend that stands out is that customers are asking about services like make-up application, blow-dry services, and spas. Because of this, our clients can reframe a trip to the mall as a special experience to look forward to, rather than just a necessity or place to complete shopping errands. In doing so, consumer perception is changing around the entire concept of malls.
During the 2018 holiday season, an average of 61% of total mall visitor questions, within our platform, were about experiences within the mall, instead of specific shopping terms. This goes against the assumption that a majority of visitors are in a mall solely to shop. The trending conversational search terms included holiday activities, things to do with kids, and seasonal features like an ice rink and photos with Santa.
2. Shopping’s Best Friend
If there’s one thing we all remember about malls it’s the iconic food and drink experience. Many have nostalgia with the food court offerings, an iconic pretzel or fruit smoothie to walk around with. It’s no surprise that shopping is best paired with a snack, and our data confirms this. The volume of food and beverage questions we receive almost always surpasses shopping-related ones across every size and type of mall in our database. This does not meanshoppers are uninterested in the retail stores, but that they are looking to discover and try new food and beverage options.
Another interesting insight is that for malls with a movie theater, over half the questions are about movie times and where best to park.
Although the word “mall” immediately brings the term “shopping” to mind, only 31% of our shopping-related questions were related to shopping lists or lists of stores for a particular category. These trends support the necessity for malls to lean into the growing visitor interest in experiences.
3. Listening To Data = Listening To Your Customers
One of our most popular clients, Miracle Mile, deployed “Jules” 2 years ago for its Las Vegas retail destination. Miracle Mile saw an increase in questions asked to “Jules” about hair styling services, happy hour specials, and where to get outfits for a night out. After discussing this trend with the team, we learned that bachelorette celebrations are their #1 visitor type. From this, Miracle Mile created a custom bachelorette response which our AI Knowledge Engine uses every time these terms are asked. This included recommending experiences such as a stop at the DryBar, enjoying drinks at one of its six bars, and selecting evening outfits at its many clothing stores before attending a concert. Additionally, these unique Miracle Mile experiences can be suggested conversationally through any touchpoint and channel where Jules is available.
“Malls are ready to lean into the data they can gather on their visitors. Using a technology like Satisfi Labs allows them to do this at scale, and quite easily.” says David Parsons, President of MG Malls. “By doing so, we’re making a commitment to understanding and working with our visitors to ensure that we provide a destination that will both fulfill their craving for specialty experiences, and entice them to return again.”
By utilizing AI conversational search technology, the industry is taking a step in the right direction. Having a deeper understanding of why consumers visit malls, and the type of experiences they’re interested in, helps facilitate the successful evolution of malls in the retail industry.