By Teidor Lyngdoh
The Great Shopping malls, pillared by the mighty branded stores, where consumers meet up with friends and shop all day, was an experience of the past. The 1990’s and early 2000’s offered a unique shopping experience along with other activities nested in such malls. Those days are gone and shopping in today’s context is no longer central to the “shopping mall” model. Today’s consumer browses different websites, apps and e-commerce platforms from the comfort of their couch, receive recommendations from online services, customer reviews and price comparison sites before making a purchase decision. Few times, they may check into a nearby store to assess an item in person. In essence, technology adoption, abundance of information, near-perfect price transparency and a parade of discounted deals, are here, and together, become a nightmarish experience for many retailers and shopping malls.
The age of retail and shopping mall apocalypse had already begun in the last decade and malls have been slowly disappearing—a cultural death now hastened by the global COVID-19 pandemic. Like many disruptions, there is a need to adapt and innovate to address the challenges these changes are introducing. Ideas of setting up shopping malls in this age of retail digital disruption need an abrupt shift from irrational exuberance to reflect economic reality.
Consumer research from leading firms and business schools have shown that globally, digital retailing is already influencing about 50% of store sales, and that number is growing rapidly. Research also shows that that one out of every four malls in America will close by 2022.Some countries have responded by repurposing and transforming these malls to provide green spaces for public recreation. For instance, with the declining footfalls, South Korea and Japan are closing their malls to convert them into green spaces. There is an urgent need for such spaces in congested cities, to recycle the air for the sake of the citizens. An example of one of these green spaces in India is Deer Park, in South Delhi.
All of this calls for conventional ideas such as shopping malls to look at an entirely new perspective—one that allows them to integrate disparate channels into a single seamless shopping experience given the impact Covid-19 has inflicted on economies. Having a Chief Minister with business degrees from Ivy league institutions such as the Wharton School of Business and Imperial College London, should have made the understanding of such paradigm shifts and the existence of alternative business models more feasible.
The COVID-19 economic crisis has already led to higher unemployment and huge revenue losses both for the state and individuals. Consumer spending is low, leaving many businesses and services in the state devastated. Not only are shopping malls out of fashion, but the current pandemic has also given more reasons as to why the proposed shopping mall at Barik will not be a prudent decision.
An alternative solution to the “Great Shopping Mall Investment” is based on the concept of developing “High Streets” across Meghalaya. We highlight a few reasons, backed with evidence, why such a concept would be a great fit for the state of Meghalaya:
4 High Streets have been defined as retail centres/streets that serve the shopping needs of a particular locality or groups of localities. It offers a broader range of experiences and services in order to become the nerve centre of a locality or group of localities; a place where people can get together and shop.
4 While Shopping malls centralise the marketing effort into one building, High streets decentralise the marketing efforts and cater to a group of localities.
4 High streets reduce congestion of cars and people from a single area- a post COVID experience, which is necessary to address. Traffic jams and the COVID-19 pandemic in Meghalaya have accelerated the call and need for this decongestion of shopping zones.
4 High streets maintain the right mix of shops, while offering experiences and a convenience that cannot be replicated online. Consumer demand usually dictates the kinds of shops and services that are available, and what goes into the local high streets, from a range of branded shops, independent stores, groceries, restaurants, pubs, fashion and coffee shops.
4 High streets give opportunities to a greater number of youth, and play an important role in their development and ability to innovate, create brands, and sell products and services that meet the changing demands of the modern consumer.
4 Government can use techniques (e.g. Location analytics) for optimal High street selection based on factors, such as population density, connectivity and ease of traffic flow, accessibility by customers and different transit modes, visibility among others.
4 There are patterns that already exist in many localities in the state that need assistance from the administration in order to develop them into high streets. The government needs to enable them to evolve in response to the changing landscape, with some form of management structure and policy planning that will constructively support the development of high streets.
A healthy discussion on such alternatives would help the local community and economy. An investment in such high streets would increase direct and spill over employment and economic opportunities much more than an investment into a single shopping mall, which would benefit only a selected few.
(Dr T. Lyngdoh is a faculty of Marketing and Analytics at University of Kent, UK and a former faculty at XLRI, Jamshedpur, India. The views of the author are personal and he can be reached at [email protected])