What’s driving our decision to head back to the mall?

While we may have gotten accustomed to the ease of online shopping during the pandemic, malls are far from extinct

Not too long into the recently released documentary White Hot: The Rise & Fall of Abercrombie & Fitch (2022), you encounter a man who struggles to summarise the essence of a mall and ultimately describes it as “a search engine that you could walk through or, you know, an online catalogue that’s an actual place”. This far-from-accurate statement was, of course, shared by many Twitter users and the crowded comments section of their tweets saw several others attempting to unsuccessfully describe the role a mall plays today. What used to be an easily describable establishment seems to be due an updated and deeper definition–one that captures its many merits while acknowledging the meteoric rise of e-commerce. We reached out to industry experts to better understand the meaning of malls today and the factors driving our decision to head back to them after over two years of being acquainted with the virtues of virtual shelves.

The current state

In her book The Lonely Century: A Call to Reconnect (2020), economist Noreena Hertz says that we, by default, favour convenience over anything effort-intensive, including interacting with other humans. This, she explains, is why we rely on Amazon’s algorithm, not the knowledge of a bookseller, for reading recommendations, and it’s also why we often prefer to communicate with a chatbot over a salesperson. The COVID-19 pandemic has further fueled this reliance on e-commerce platforms.

A report by data and analytics company GlobalData predicts that the sales from the Indian e-commerce market will amount to $74.8 billion in 2022. Yet, in recent times, we’ve seen headlines about expansive brick-and-mortar establishments coming into existence. After opening the 17.5-acre Jio World Drive in Mumbai’s Bandra-Kurla Complex last year, Reliance Industries Limited is all set to launch Jio World Plaza in 2023 in Mumbai. The luxury shopping destination is estimated to be the size of 10 football fields. “As we speak, there are close to 30 large- to medium-sized malls that are under construction in India and they are all expected to be launched in the next 12 to 18 months,” says Mukesh Kumar, chairman of the board at Shopping Centres Association of India. Additionally, the country’s existing malls are also seeing their footfalls inch closer to pre-pandemic numbers. “Footfalls have reached almost 80 per cent of what they used to be before the pandemic but conversions and average basket size have gone up substantially,” adds Kumar. Rajneesh Mahajan, CEO of Inorbit Malls, shares similar statistics. “The consumption has started growing. We’re consuming more than what we were earlier. Currently, what we’re experiencing is a 20 to 27 per cent growth,” he says.

The key contributors

While the figures we’re presented with look optimistic, it’s important to evaluate whether what we’re witnessing is a short-lived surge driven by revenge shopping or something more sustainable backed by concrete contributors specific to physical spaces. A quick trip to the mall exposes you to some obvious pluses. Malls allow us to touch and try a potential purchase, they give us access to the expertise of a store’s staff and are also more suited to the less tech-savvy amongst us who find the many filters on e-commerce platforms more frustrating than helpful. “The overall experience in a mall is better–you’re in an air-conditioned environment and surrounded by teams who are trained and able to answer certain questions that may not be answered by a chatbot or the FAQ section of a website. In addition to this, manoeuvring a website is not always easy. In a mall, you can hop between similar brands and then decide what you want to purchase,” says Sameep Pathak, CEO of Oberoi Realty’s mall business.

However, the enhanced retail experience isn’t the only thing that’s making us return to malls. There’s an episode in Gilmore Girls called ‘Scene in a Mall’ which sees Lorelai, Rory and Emily–the show’s leading characters that belong to three different generations–share a multi-cuisine meal procured from the many kiosks of the mall’s food court. This, for me, succinctly sums up the purpose of a mall; it has always been a space where you can bond with family and friends.

“Malls are not just a place to shop but are also a social space. Today, footfall drivers include food and beverage, hypermarkets, multiplexes, quality entertainment and events,” says Kumar. Pathak is aligned to this school of thought. “Malls are no longer just a retail destination. If you ask people what their weekend plans are, their first thought is not to visit a website but to go to a place like a mall. It’s almost a mini-vacation for many. Customers stay for an average of two to four hours and spend their time at family entertainment centres, watching movies or eating. Previously, food and beverage would take up only 20 to 25 per cent of a mall. Today, that proportion is increasing,” he says, highlighting that food is becoming increasingly important to the success of a mall. His point of view is supported by Deloitte’s report titled ‘Future of the Mall: Building a New Kind of Destination for the Post-Pandemic World’, which suggests that even internationally, food is considered to be the new fashion for malls and as much as 50 per cent of floor space could be allocated to it in the future.

In addition to providing an array of experiences, there are two other purposes, according to Hertz, that public spaces like malls serve. The first is that they teach us how to come together, practice civility and peacefully co-exist. Secondly, they are a source of micro-interactions. The brief but friendly conversations we have with the person at the cash counter or the barista preparing our coffee often serve as an emotional boost, not an inconvenience, for the increasingly lonely residents of fast-paced cities. Long story short: Today, malls are as much about community as they are about commerce. “We plan events catering to every age group, from an interactive experience centre for kids created in collaboration with Discovery Channel to an evening for senior citizens which gives them access to a dedicated space as well as assistance. Several new developments also have open spaces where the customer can enjoy walks, yoga sessions and even gigs,” says Pathak.

The case for co-existence

So are the extensive efforts being made by malls going to convince us to leave behind the convenience of e-commerce or are we likely to adopt a hybrid approach that allows us to have the best of both worlds? “Both these channels of sale play a role in a consumer’s life and it is not that a consumer who shops online, never shops offline. There’s no migration of customers from one sales channel to another. I think both of them have a role,” says Mahajan.

According to him, the idea is not to establish the superiority of one medium over the other. The future of retail lies in the acceptance that the two will co-exist and even complement each other. “All the players who started exclusively online have begun to open stores. Their experience is that as they open more stores, the sales from the same pin code or micro-market increases. If their presence is through multiple channels in one micro-market, in that same micro-market the wallet share goes up. This is a clear indication that it’s not about online versus offline but about how we best reach out to the consumer. That’s been the game plan for retail,” concludes Mahajan.

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