Shopping Centre
Horses for courses
As commercialisation becomes more sophisticated, more thought is being put into what income generators will appeal to customers
Published:  22 June, 2006
Page 20 

With so many opportunities to generate non-rental income, it's important that shopping centre teams put time and effort into researching their diverse customer base and spend time asking their shoppers what they would like to see on the mall floor.

It's no good filling a space with drinks vending machines if your customers are more likely to go into the centre's newsagent; similarly, there's little point in focusing on kiddie rides if the retailers are mainly boutique-style.

thecentre:mk in Milton Keynes regularly holds large-scale events and activities at Middleton Hall as well as promotions in four prime sites around the mall and a regular programme of markets in Queens Court, but the centre's commercial and events manager Jackie Tracey chooses the events carefully to "enhance the shopping experience by engaging with the customer".

She explains: "In retail theatre we hope to deliver a spectacle, create an emotive response and encourage interaction and participation. Our aim is to boost penetration of our catchment area and increase dwell times with each visit, resulting in greater sales for our retailers."

Women probably form the biggest group of customers frequenting shopping malls and with this in mind it makes sense that management teams focus their methods of increasing mall income to appeal to their female shoppers.

According to research by Photo-Me International, shopping centres could become the leading digital photo print location. In a recent survey, 64 per cent of female respondents who own a digital camera or who are planning to purchase a digital camera, believe that retail locations will become their preferred location for printing their digital photos.

Photo-Me anticipates a large number of customers will be using their digital printing kiosks and that shopping centre customers will be introduced to a new service that offers high quality photographs in a very short time and at a reasonable price.

While pleasing the centre's typical shopper is important, shopping malls are also realising the importance of using income generators to attract and entertain the bored husbands who trail around with the bags, or teenage shoppers, who will frequent shopping centres but often only to window shop.

FX Simulation is one company that has caught onto this void in the market by introducing simulators to the shopping centre industry. Their latest model is the X2 - a simulator that offers a choice of eight rides, SMS text messaging, LCD 32-inch high definition monitor, camera in the capsule and 4D effect - and is currently in operation at several shopping centres in the UK, including Edinburgh's Ocean Terminal. The company hopes to see it operating successfully in 30 centres within the next 12 months. It has already proved a storming success in Dubai where young people use shopping malls as places to hang out.

Alan Fleming, international operations director, says: "In a shopping centre environment the profile of people that go there is either families on a Saturday afternoon, or women. X2 is something to entertain the kids and fathers because the various rides appeal to all age groups. We develop all our rides in-house, and they range from ski slopes to futuristic flying cars."

FX Simulation usually operates the machines on a revenue share basis - 60 per cent to the operator and 40 per cent to the shopping centre. As a result, schemes are able to make money from men, who would otherwise sit around the malls holding the bags, or young people who just use shopping centres as somewhere to meet friends and walk around.

Fleming continues: "The feedback we've had from mall managers is that they want to make their schemes a destination place rather than just somewhere to go shopping."

Meanwhile, for shopping centres that don't have the time to look into the vending machine market, VP Solutions offers the perfect answer. Jonathan Simpson, who started up the business a couple of years ago, is on hand to assist shopping centre managers who want to put vending machines onto their malls but don't know what's available and what will and won't work.

Simpson works with a number of vending machine companies and will present the centre with a choice of products that he can offer. He acts as a one-stop shop for that part of the business - sourcing the product, carrying out the research for the centre and providing the manager with reports on how well the machines are performing.

"People never have time to research this market," says Simpson, who explores vending options from toy and sweet vending to digital printing kiosks and machines offering wi-fi connection.

He understands that for vending machines to generate income they need to appeal to the centre's regular customer. "Having a particular vending machine in a centre isn't going to draw traffic from the high street into the centre - it's about striking a balance between generating revenue for the centre and offering a service to the customers. There are certainly things you can introduce that increases dwelltime or shopping time, such as massage chairs. They perform ridiculously well in shopping centres - it's a good way of generating money for the centre while consumers will have a massage and then carry on shopping, which also benefits the tenants. There are certainly products that benefit everybody.

"Toy vending certainly has an element of pester power, but little Timmy is happy as he's got his toy and that keeps him content for half an hour, allowing mum to shop."

So how does Simpson decide which vending machine will work in which centre?

"Some of it is down to consumer demographics," he says. "With toy vending Cs and Ds are better than As and Bs for example. The other key influence is the position of the machines. Footfall comes into it as well, but if you have a machine that's tucked in the corner that no one sees, even if footfall is high, it won't perform. Position is key but everyone is after the best position so it's about striking a balance with the centre on what's best for all parties."

Meadowhall was awarded a Merit Award for commercialisation at the 2005 Purple Apple awards, recognising the way it has explored and used innovative tools to generate mall income and add value to the customer's shopping experience. Meadowall's marketing manager Georgina Thompson says the mall management is constantly looking at ways of expanding the traditional commercialisation angles, particularly with the use of new media and mall promotions. "Meadowhall has built a very successful reputation for a variety of high quality promotions and events through re-visiting past successful promotions and activities and then cherry-picking new promotions that will increase the customer experience at the centre." She adds that with so much interest from promotion companies wishing to come to Meadowhall, selecting the right activity is vital.

"Promotions are considered on a twofold basis. Firstly, those that are a suitable match for the profile of the centre's core customers (78 per cent female, 59 per cent with children and an average age of 25 to 44). Secondly, the experience as a whole is considered. For example, what will the activity offer to the centre? What will it add to the customer experience? What are the links with retailers, if any? Will the activity increase sales and appeal to non-customers, therefore increasing and driving footfall?"

A recent example of targeted activity was in April when the centre unveiled its new marketing campaign, Meadowhall - Land of Shoppertunity. To support the launch it welcomed Thunder Theme Park to the centre, which took a site of over 27,000 sq ft, housing more than 20 rides and attractions for all the family.

Thompson adds: "The theme park is a great example of the centre increasing income generation outside of the malls. The reasoning behind hosting the park was multi-functional - to attract lapsed shoppers, increase visitor figures and surprise customers with a new and 'very different' event."

The marketing team is also working to actively target men. The Meadowhall Motorshow is set to run again this summer after its success last year, when it hosted over 40 top automotive exhibitors, as well as Brum the cartoon character and the car from Chitty Chitty Bang Bang making special appearances.

Thompson says: "Last year's event proved a huge success with many exhibitors attributing actual sales and test drives directly to their presence at the Meadowhall Motorshow. What's more, the centre's weekend footfall was up 19 per cent on the previous year, a clear illustration of the pull of the motorshow and its success in driving visitors back to the centre."

Visitors to the MetroCentre in Gateshead were able to take a closer look at the latest models from Toyota - RAV4 and the new Yaris - last month when the company came to the mall, exhibiting from May 1 to 13.

The centre also puts a lot of thought into its mall promotions and income-generating activities and insists there is research behind each new initiative that comes onto the malls.

Most are referred initially from head office. CSC Enterprises and the mall will take them on from an operational point of view and also ensure that all initiatives fit into the centre, both physically and in terms of the centre's image and ethos.

"Some promotions would fit in with the current profile of the centre and others would be put in place to try and attract a different kind of customer," says public relations and promotions manager Janet Monks. "All are initiated with an aim of enhancing the offer to the customer."

Info Pod is a new company which is providing shopping centres with the opportunity to generate additional mall income, while also pulling footfall into the centre.

The new product is a little over 2 metres tall and 1 metre wide and encompasses four screens that are used by shoppers to obtain information about the local area, and by local companies to advertise their services. Competitions and offers run alongside the machine, with Info Pod doing leaflet drops in the community to let local people know that if they visit the centre and use the pods they can get money-off vouchers or prizes.

Managing director Bill Stillman has launched the first Info Pod at the Clock Towers shopping centre in Rugby this month and other centres are already lining up to take them. He says the advantage to advertisers is the additional number of people they can target in a shopping centre environment, while shoppers are able to access local information at the touch of a button and receive offers by using the machines. The pods are internet- and email-enabled, allowing customers to look at and contact local companies, recruitment agencies, estate agents, shops, restaurants or local authorities. The pods are bluetooth-enabled as well so that if someone with a bluetooth phone walks past, they will automatically receive a text telling them about certain offers that they can print off from the pods.

"It attracts advertising revenue from outside the shopping mall," says Stillman. "Advertisers can show their product locally to the community and shopping centres are where people in the community spend a great deal of their time."

The advertiser will get front panel advertising as well as a screen saver with links to their website and additional local information.

"The advertising space is already booked on the pods before they have even been placed in the shopping centres," says Stillman. "We've geared this much more for local communities and we're bringing local people in from outside."

Info Pod pays commercial rents of £150 to £500 a month for space within a shopping centre, depending on the size of the scheme, but it is also happy to discuss realistic commercial propositions.


Convenience vending for shoppers

Vending machines are a quick, easy and convenient way for shoppers to get what they want while on the move.

Introducing drinks machines or phone top-up machines makes life easier for the customer while also generating extra income for the shopping centre.

Research has shown that modern consumers are more demanding than ever before and value convenience in their busy lives. Drinks and snack machines are therefore a convenient way for shoppers to fuel up without having to push their way through a shop before joining a long queue. Similarly, other machines are being introduced that are designed to make life easier for the customer, while giving the shopping centre a bit of extra income.

Umbrolly is one example of making a machine work for both the centre and the customer. These machines, which vend umbrellas for £2, have been installed in a number of shopping centres across the country and the company has just introduced a new 'mini' machine, which it launched last month.

Managing director Charles Ejogo says the larger unit was taking up a lot of space in shopping centres and many malls simply did not have the space next to their exits to introduce them, but the smaller units are designed to take up a small footprint and can be bolted to walls inside the mall's entrances.

Ejogo says: "For the shopping centre it means that rather than customers blocking the exits because it's raining, they can pick up an umbrella and be on their way. Also, this smaller model doesn't need power - all it needs is a couple of bolts onto the wall, and because of its appearance it blends in well with the centre.

"For the customer it's convenience - they don't need to go back into the shopping centre looking for somewhere to buy an umbrella that will probably cost them £10."

The new units will be introduced across the whole of Westfield's portfolio this month, while Capital Shopping Centres is introducing a mixture of the large and small machines.

Britvic Soft Drinks has extensive experience in the retail sector with machines operating in a number of shopping centres owned by Hammerson and The Mall Corporation. In fact, vending is now a common part of the retail mix within many shopping centres.

The company says the growth in the soft drinks market is now being driven by still/water categories, with simple can and bottle vending not enough to satisfy the demands of modern consumers who require a wider choice of drinks that suit their needs.

The health agenda being driven by the government has also cascaded down to families and mums are now increasingly concerned about 'better for you products', says Britvic, which has responded to the challenge with a new product development programme driving innovation with products such as Fruit Shoot H2O flavoured spring water.


Contacts

VP Solutions: http://www.vpsolutions.co.uk 07843 275079

FX Simulation: http://www.fxsimulation.com

Photo-Me: 01372 453399

Info Pod: http://www.infopoduk.com

Umbrolly: 020 7341 9902

Britvic: http://www.britvic.com



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