Retail in Transit

It’s been a challenging year for retail as both landlords and retailers grapple with an economy that’s restructuring.

09 Dec 2016

By Letty Lee

Retail in Transit
It’s been a challenging year for retail as both landlords and retailers grapple with an economy that’s restructuring. Local newspapers are reporting large vacant spaces in shopping malls, while retailers are challenged by labour constraints and high operating costs. Landlords are adjusting to tech disruption, the emergence of e-commerce and online shopping luring people away from shopping in stores. Retail is in a flux, but some positive trends point to retail players turning risk to opportunity.

Place-Making

One of the main trends is bringing back the idea of ‘Place-making’ – curating the experience of shopping, beyond the mechanics of buy and sell Fast fashion chains like Uniqlo hold workshops at the Orchard Central flagship stores, while Harvey Norman set up a gaming hub in Millenia Walk for consumers to try out the consoles and VR devices. These initiatives can help set apart flagship stores from other outlets and draw customers to specific areas.

Retail-tainment

The trend of retail-tainment is also picking up, as landlords offer free or unique features within malls to attract consumers. This also helps malls define their target market and draw niche shoppers, thus differentiating them from run-of-the-mill malls. Examples of these include Kallang Wave Mall’s indoor rock-climbing facility, branding the mall as the go-to spot for sports related activities, or positioning the newly opened Compass One as a family mall with its Wet and Dry Playground.

Omni-channel retailing

As mentioned in my last two posts, with the advent of technology and the familiarity and acceptance of shoppers with e-commerce and online shopping, retailers need to start thinking of leveraging on digital options in order to stay relevant. Retailers have the option of either creating a digital platform, or leveraging on existing third party platforms like Zalora or Lazada in order to increase their reach.

Lifestyle approach to retail

Larger retailers and franchises are also beginning to embrace a larger service offering and incorporate an all-round ‘lifestyle’ element to shopping. A great example of this is the Mahota Commune in Singapore, which eschews the norm by including not only a café into their retail space, but also a DIY wood-workshop, an organic market, a lifestyle studio and a TCM wellness clinic all within the same premises. This mix works as it builds on Mahota’s focus on wellness to create a harmonious mix of goods and services. Introducing more services and products draws more shoppers and expands the revenue streams in the same physical space.

Niche services

There is also a trend of niche or highly specialised service providers springing up, especially in the health and fitness arena. Instead of big gyms with lengthy memberships and a plethora of classes, consumers seem to be flocking instead to highly specialized intensive style trainings, for example High-Intensity Interval Training provider Ritual, or Webarre which specialises in ballet type strengthening exercise. These niche providers appeal especially to a growing group of consumers who know specifically what they want and are willing to pay for premium services that fit their lifestyle and choices.

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