Rethinking Shopping Malls
Previously, shopping centers and retailers faced multiple challenges; the rise of e-commerce, the decline of people walking in malls, and a shift in shopping behavior during the pandemic. More than 50 retailers faced bankruptcies in 2020, and a movement in consumer behavior toward online services and online retail sales expanded significantly in various countries. The online shopping market share in South Korea was 25.9% in 2020, up from 20.9% in the previous year, according to UNCTAD. This could serve as a driver for more digital transactions and influence consumers' convenient behavior. Moreover, this may not be the only incentive for shopping malls to adapt to creating a physical store experience and digital shopping experience.
THE ABSENCE OF PHYSICAL CUSTOMER EXPERIENCE
As a result of Covid-19, all shopping centers and retailers saw a decline in foot traffic, compelling them to reevaluate customer experience to grasp the most attention from declining in-store customers. As shown by a survey from Qualtrics, a customer experience platform provider, organizations that provide good customer experience outperformed those on the S&P index with a lack thereof of almost 80%. In addition, customers are 7 times more likely to return and 15 times more likely to spread word of mouth. In another survey conducted by the International Council of Shopping Centers, 73% of consumers are more likely to exceed their spending plan when they are treated well. Also, more than 60% are more satisfied with in-store customer service than online service, highlighting the importance of the in-person experience. Hence, it is unsurprising that customer experience should be highlighted to improve visitorship and generate more sales.
REBUILDING CUSTOMER EXPERIENCE VIA TECHNOLOGY
In addition, elevating in-person customer service is another option. This can provide a positive experience for online customers, gaining their favor. London's Harrods, a luxury UK department store, for instance, has engaged customers through virtual personal shopping, particularly during the pandemic when customers cannot purchase independently. The idea was to integrate technology with the customer experience, thereby creating a virtual personal shopping service. For example, malls can offer images and telephone consultations to customers who would have previously shopped in person. According to a survey conducted by the International Council of Shopping Centers, 80 percent of these customers are from the Middle East and China.
Business practices will never be the same when confronted with a volatile and uncertain environment. Not only may companies need to adjust to online and offline sales, but they also need to broaden their efforts to offer exceptional consumer experiences. They have endured numerous significant crises in the past; now, they must adapt again—therefore being resistant to potential future challenges.
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