Home Retail Mall Marketing: What’s the Catch for Tenants

    Mall Marketing: What’s the Catch for Tenants


    According to JP Biswas, Head – Leasing and Marketing, L&T Realty, the events organised by the management of a mall inside the property cost a lot of money. It is therefore important that these do not merely increase the footfall for its own sake, but actually contribute to the increased sales of the tenants by driving traffic to their stores.

    Typically, when we talk of mall marketing, we talk about increasing the footfalls and prolonging customer visits. Mall managers focus on events such as fashion shows for women, concerts for teenagers, car shows for men, and cartoon-character-themed events for children. These events, even when sponsored by companies like Pepsi or Coca-Cola, cost millions to put on. But they are essential because malls should be places where shoppers feel welcome even if they do not spend a single cent. In the long run, by fostering loyalty, these efforts pay off by creating customers for lifetime for a mall and its tenants.

    We have seen some fantastic community programs by malls such as Inorbit with its Aikya and Bodh initiatives and the Oberoi mall with its “Make a Wish” initiative, to name a couple, which have been hugely successful and attracted considerable footfall numbers.

    Marketing initiatives that are focused towards attracting more footfalls work at the time of the launch of a mall, or in case of a re-launch. The instance of the CentralWorld mall in Thailand, which was burnt down during the country’s worst political unrest in 2010, is quite apt. When it re-opened after six months of renovation, one of its main objectives was to regain the footfall numbers that the mall enjoyed before closing down. It was critical for it to make its customers feel as much at home as they used to like in the earlier days.

    The marketing departments of malls in India still feel it is paramount to project the idea of the property being a part of the local communities. This year too, there will be plenty of events held like concerts, summer attractions for kids, workshops for women, fashion shows and live performances. There will be many “Indian Idol” and “Dance India Dance“ auditions as well as live shows by the reality show contestants at the malls. And people will drive long distances to participate in things like these. Mall managers will estimate that the events attracted anywhere from 5,000 to 25,000 visitors more than usual and will be content with the increased footfall numbers.

    But someone somewhere has to think about the bottom line, keep an account of the expenses that the mall managers are happy to incur to get those footfall numbers, and figure out what those expenses are fetching the mall tenants in return. After all, it is the mall tenants, that is, the retailers, who are paying for all those promotions in the form of CAM charges. It is but natural for the retailers to ask the crucial question: “What am I getting in return for all those promotional expenses?”

    A few pertinent questions in this regard that arise in one’s mind are: Do we really measure the difference in the business of retailers in a mall before and after an event? Can we surely attribute certain spikes in the retailers’ business to a certain event or promotional drive undertaken by the mall? Can these initiatives be driven unilaterally by the mall with little or no participation from the retailers? Are these marketing initiatives able to get more customers into the mall as against more footfalls? Are they making the customers come back again and again into the property?

    These questions, I am sure, are being faced by nearly all the mall marketing managers in the country. While the questions are not unknown, the answers that have come up so far are not being verified for their effectiveness and hence we keep seeing more and more of community initiatives. This view of the mall marketing departments needs to change. People are much more planned now about their purchases and the difficulty for shopping centers is, how to keep their audiences engaged. While events are great, I think we need to plan a lot more interactive ones where you get consumers to participate in the process.

    For example, during the last holiday season, 25 malls across the US allowed Nintendo, the producer of video game consoles, to set up temporary kiosks at their premises where shoppers could play Wii Music, Wii Sports and Wii Fit games for free. Nintendo got to promote its brand while the mall owners got a chance to help their electronics retailers sell more Nintendo products. It is noteworthy that the campaign was focused and benefited only a particular category of retailers.

    Campaigns and promotional activities can also be woven around product categories and store openings. When local charities are involved in such activities and retailers are asked to build their campaign around them, the malls get to benefit without spending the big money. For example, from July 27 through August 13 this year, Macerich of the US plans to hold a denim drive at most of its 72 properties to support local charities. At the end of the two-week period, the company will host a Great Denim Event in which volunteers will be able to help package the donated jeans for delivery. Simultaneously, participants will get expert advice on which style of jeans best fit their bodies. In many centers, that advice will be provided by employees of Gap, a major tenant of Macerich malls.

    We have seen a similar marketing initiative in Mumbai championing the “green cause” where customers were asked to donate their waste newspapers so that a Ganesha idol could be made out of them. While it spread great awareness about how the material used for making Ganesha idols commercially, was polluting our water bodies and how the mall-goers were contributing to the making of something that was eco-friendly, what it meant for the retailers and how it helped in increasing the sales of the retailers in those festival days is a question that we do not have an answer for.

    Marketing campaigns run by malls in which the retailers are equally interested and build their own ones around it tend to be extremely cost-efficient. There is usually no stage to be assembled, no special equipment to be rented, and no animated characters to pay for. The developer merely needs to spruce up the center’s common area, serve as a liaison for the charities that benefit from the shoppers’ donations and send the word out to the community, often through free-of-charge communications channels such as Facebook and Twitter. The rest is up to the retailers.

    A part of what will make these kinds of campaigns possible is an increased cooperation from the tenants. While mall owners and retailers have always tried to work together to improve shopper traffic and sales, when times are good, retailers could often be less than enthusiastic about participating. Today, most of the effort for marketing campaigns has to come from the landlord. This needs to change.

    A lot is discussed about what should be done to get the maximum value out of the buck that is being spent and how the retailers should participate at a much deeper level than just giving away redemption coupons. But little is said about how to keep the shoppers engaged for longer periods of time even when they are not present in the mall.

    What was not possible a few years back is becoming more and more so with social networking sites which are already all-pervasive, especially with the younger generation. Mall owners are using Facebook and Twitter to keep their patrons engaged. Developers ranging from Inorbit to Oberoi are posting fresh retailer promotions and event schedules on the mall’s website and Facebook pages, so that shoppers know in advance when to visit the mall to get the most out of the experience. Plus, posts on social media sites can be used to drive extra traffic to the property.

    One of the most relevant examples of how social networking sites have helped mall owners keep in touch with shoppers is the CentralWorld Mall in Bangkok. In terms of business and brand, the long closure of the property may also have resulted in a disconnect with the customers. This would have led to the risk of brand switching in the long run, as customers moved to shopping complexes nearby.

    As far as the customers were concerned, they were in a very depressing moment with worries about their day-to-day lives and also the future. They suffered from the country’s economic downturn due to the ongoing political problems. People felt personally devastated from the conflict and violence in Thailand. These factors affected the shopping and spending atmosphere in Bangkok.

    Before the political chaos took a violent turn and forced CentralWorld to close down, it was a well known fact that it comprised a large community of shopping enthusiasts. These people now had no place to congregate around. CentralWorld deeply appreciated the need for its shoppers community to continue existing and strategically employed digital media to create an online community for these people until the property was ready to open again.

    During the six months between the political unrest and the re-opening day, CentralWorld used various digital media to communicate and keep in touch with its customers, including putting up banners on websites, creating a Facebook group called “We are confident that over a million Thais are missing CentralWorld,” building a fan page on Facebook and using Twitter to provide updates to customers.

    Icons and banners were created for customers and fans to display on their Facebook profiles or use as avatars on Blackberry Messengers. Special music videos featuring pictures of fans attending various activities at the mall were made and uploaded on Facebook and You Tube. Latest updates were posted on Thailand’s various popular web-boards, especially Pantip.com. In addition, e-cards, in which CentralWorld’s executives expressed their appreciation for the support the mall had received, were sent out to customers.

    The many things that the CentralWorld’s marketing department did – mostly online – included creating an online community and a Facebook group, providing daily updates on the situation to people, keeping in touch with their customers and making them feel included in the entire process, encouraging participation by doing small things like creating icons (“I want to see a movie,” “I want to spend” etc.) for customers to display on their social network and Blackberry Messenger profiles, and putting up re-opening countdown banners on the property’s website.

    Centralworld also offered special privileges to help recruit more people and expand the online community. Special “I Love CW” t-shirts were given to members of the CentralWorld’s Facebook group who displayed pictures taken at the mall. These shots were later incorporated into Facebook and You Tube music videos.

    In addition, CentralWorld organised various fun activities for members of its Facebook group during the closure of the property. Lucky winners from Facebook and Twitter were given Thai designer t-shirts, redeemable for discounts on the re-opening day of CentralWorld. These in turn promoted the new Thai Designer Zone at CentralWorld. The “Great to see you again at CentralWorld” campaign was also very successful. The “CentralWorld Lost and Found” contest gave three Facebook page winners a once-in-a-lifetime chance of a 50-minute helicopter ride over Bangkok sponsored by Advance Aviation.

    The results of all these initiatives were phenomenal. The word-of-mouth strategy was very effective, as evidenced by the rapid expansion of the online community. CentralWorld was able to establish a deep and direct connection with its customers through the online community. Web traffic of over 150,000 visited CentralWorld on its re-opening day. There was a record-breaking coupon selling and over 300,000 people were witnessed at the countdown event at CentralWorld Square.

    Even though presence on the social networking sites is free, to turn them into an effective marketing tool, developers need to invest in manpower to update them on a regular basis. With these types of websites, you cannot just put something up there and leave it at that for months. The downfall of this could be that people would not get answers to their questions and fail to connect with the property. Facebook and Twitter sites need to be updated daily. Responding to shoppers’ questions in a timely manner pays off in increased sales. When the marketing personnel at an upscale fashion store tweet about a new product, the likelihood of the store clocking more sales for that particular product goes up.

    Another phenomenon making the digital social life of the young generation even more pervasive is smart-phones. With 24×7 connectivity and frantic posts, the world has become smaller, more connected and furiously fast paced. In the West, we are already witnessing mall owners investing in smart-phone apps that will keep their customers engaged and the retailers tied in. Out here in India, we need to gear up fast. We need to gallop, not walk.

    About the author:
    JP Biswas has the responsibility for all retail projects of L&T Realty. Earlier he was working with  Sheth Developers & Realtors India Ltd, as VP – Leasing & Marketing. An IIM Bangalore alumni, Biswas has been in the retail real estate industry for the past six years having started his journey at Inorbit, where he front-ended the marketing and research initiatives of the company in addition to the leasing of its then upcoming malls in Vashi, Hyderabad and Pune. After Inorbit, he joined DLF Retail Developers to head the leasing and marketing functions in the company’s western region projects spanning Maharashtra, Gujarat and Goa.

    *This column was originally published in August-September 2012 issue of Shopping Centre News.