By Nellie Day
LAS VEGAS — Some of the nation’s largest shopping center owners and managers took a break early this week from discussing the physical attributes of their properties to focus on their technological infrastructure during RECon 2014 at the Las Vegas Convention Center.
While the shopping center is still the priority, much of the conference’s talk so far has focused on the properties’ unseen attributes — its Wifi capabilities, omni-channel presence, appreciation for social media, data analysis, sophisticated information technology systems — in the quest to get more shoppers in the store and ring up more sales.
“It takes a huge shift in thinking to say that we as a property, or we as an owner, value technology enough that we’re going to make an investment because we believe that investment is going to keep bringing customers to our shopping centers,” said Corbett Guest, CEO of Dallas-based Imaginuity, a digital marketing agency that works with business-to-business and business-to-consumer companies.
“If you just throw a bunch of money at different things and hope they stick, you’re going to spend a whole bunch of money,” said Guest.
Therein lies the problem that panelists addressed during an educational session, titled The New Math: 1 + 1 = 3: Leveraging the Omni-Channel Shopper, on Sunday, May 18.
A majority of shopping center decision-makers seem to realize they must develop or increase their online communications with consumers to maintain foot traffic and provide the best experience possible. For many, unfortunately, the strategy ends there as a lack of knowledge — and sometimes money — prevents many centers from reaching their ideal saturation points with the new omni-channel consumer.
“Many centers are whistling in the dark when it comes to interaction,” Guest pointed out. “They all hate Yelp and Groupon.”
The statistics favor biting the bullet and making the necessary investment in time, energy and money in technology and social media if a center is to remain competitive.
Panelists pointed out that the omni-channel shopper — one who actively maintains a presence on and seeks out information via social media, store websites, loyalty programs, price comparison apps, email campaigns, and consumer report websites — is extremely profitable to centers.
Panelist moderator David Lobaugh, president of Marietta, Ga.-based August Partners, which provides consumer and market research on malls, outlets, lifestyle and specialty centers for REITs, noted that a bricks-and-mortar shopper who is also an online shopper can triple sales productivity (thus, 1 + 1 = 3) at a given center — if you can reach that consumer.
“The challenge is identifying good marketing, creating specific messages on the channels where you want to talk to consumers,” said Lobaugh. “It’s all about how you craft that message, and we’re not just talking about broad messages announcing that such-and-such store is now open.”
Lobaugh shared some sobering statistics about today’s savvy shoppers: 71 percent expect to view in-store inventory online; 50 percent expect to buy online and pick up items in the store; and 39 percent are unlikely to visit a retailer’s store if its online component doesn’t provide information about the physical store’s inventory.
With this kind of data in mind, it’s clear that the retail environment is no longer a competition between bricks and mortar and online. It’s shifted from “us versus them” to “us and them.” For many retailers, bridging that gap starts with investing in their own back-end systems and social media presence.
“Macy’s is a perfect example,” said Lobaugh. “It’s present on Facebook, Twitter, Pinterest, YouTube, email, SMS [text], Snapchat, iHeartRadio. It’s omni-present.”
Macy's may be “the world's largest store,” but it also has
superb social media presence, according to ICSC panelists. Above is
perhaps its most famous brick-and-mortar outpost, on 34th Street in New
York's Herald Square.
Lobaugh also pointed out that emails are now “15 times the size they were about three years ago.” This is due to the large amount of merchandise images included in each blast. Retailers embed specialized links in these images, in addition to buttons that let users share those images on relevant sites like Facebook, Twitter and Pinterest.
“Almost every time, social media is the first decision-making place a consumer will go,” said Brian Lutz, marketing services manager for Chattanooga, Tenn.-based CBL & Associates Properties. “They see their friend share a photo of their new car, their new shoes. It is the first thing someone sees that makes them want to look for more information.”
Retailers appreciate the added publicity these “shares” can generate for a specific product or company, but what they’re really after is the data behind these clicks.
“The data can help you adjust store mix and learn about your shoppers’ habits,” said Lobaugh. “You need all the data you can get. It makes you a better marketer. It makes your consumers easier to target. It allows you to develop quality content.”
Though the statistics are there and the data is ready to be mined, many centers still haven’t quite caught up to their consumers when it comes to technology and social media.
“Facebook click-through rates are up 171 percent year over year,” said Guest. “More and more people are clicking and sharing. And the cost per click that a company has to spend is down 40 percent. Meanwhile, the return on investment is up 84 percent. Social site referrals on Pinterest are up 84 percent. Meaningful social engagement is up significantly. But branded posts by companies are only [slightly] up. Brands have only increased their efforts by a little bit.”
For the naysayers who still believe the battle wages on between the bricks-and-mortar and online worlds, there is proof this cycle has come full circle. Many of the leading online shopping outlets have now established a bricks-and-mortar presence. And this doesn’t just apply to the hip gadget and electronics companies like Apple, Microsoft and Sony.
“HauteLook is thinking about doing some stores,” said Lobaugh. “Birchbox opened a store in SoHo. Boston Proper now has many stores. Warby Parker has 13 stores. The direction of the retail industry favors the synergy we’re discussing today.”