The This store acted as the anchor to

The history of shopping malls goes as early
as 1922 when the world’s first shopping mall was opened near Kansas City in USA.
From its inception, it has passed the test of time and has become a part of the
economy and modern day retail industry. In the early days the malls were more
like shopping centres with similar type of products being available in most of
the stores. It had a series of small specialty shops leading via a pathway
towards a departmental store. This store acted as the anchor to attract the
crowd. The idea was to attract people to the anchor store who would indulge in
shopping in the specialised store on their way. These centres were ideally
situated near the highway with free parking facilities. The enclosed,
climate-controlled indoor mall was introduced by Victor Gruen, an Austrian
refugee who fled from the Nazis, at the Southdale Shopping Center in Edina,
Minnesota, a suburb of Minneapolis, in 1956. The enclosed, indoor model with
controlled temperature became famous and after few years, open air shopping
centres were not preferred by the customers.

The
Indian retail industry in the last 7 decades has slowly emerged as one of the
most dynamic industries due to the significant growth opportunities available
in this India. Retail industry currently accounts for over 10 per cent of the
country’s Gross Domestic Product (GDP) and more than 8.5 per cent of the total
employment generated in the formal sector of the country .India is currently
ranked as the world’s fifth-largest global market in the retail space due to
the ever-growing domestic demand. Indian Retail Industry has immense growth potential
as India has the second largest population with affluent and expanding middle
class, rapid urbanisation.

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India’s retail market is poised to continually grow at a
Compound Annual Growth Rate (CAGR) of over 10 per cent to US$ 1.6 trillion by
2026 from the current US$ 641 billion in 2016. The Total retail market comprising
of the organised and unorganised retail sector is expected to grow at over 11-
12 per cent per annum. Indian retail market is classified into “Organised
Retail Market” which is valued at $60 billion which is currently only 9 per
cent of the total sector and “Unorganised Retail Market constitutes the rest 91
per cent of the sector. Malls belong to the organised retail market.

 

Malls comprise the official retail sector. As per IBEF, Shopping malls are defined as “one or more
buildings forming a complex of shops representing merchandisers, with
interconnected walkways enabling visitors to walk from unit to unit.” Unofficially,
they are currently the heart and soul of the communities everywhere, the grass root
foundation of the retail economies, and a social meeting point for the
teenagers everywhere. In recent decades, the concept of the shopping mall,
which has its beginning in the U.S. and became a modern retail face across the
world in the post-WWII Years, has proliferated across the whole globe.

Despite its uniqueness and
plethora of offerings, the malls across the world are currently at a critical
inflection point owing to various economic, policy related and geopolitical
factors.   Many global trends are happening
simultaneously to cause malls to change the role they play in our lives.
Customers are thinking beyond shopping. Now, when consumers visit malls, they
are looking for customer experiences and unique offerings that go well beyond the
arena of traditional shopping.

Malls need to move in a different
direction, staying away from their commoditized shopping experiences and toward
a unique value proposition for consumers. Innovative  and Gen next malls across the world are
incorporating different  value-added
elements that perceive the mall as the new downtown, including concerts, arts centres,
spas, fitness clubs, and farmer’s markets. These distinct services provide a varied
level of entertainment packages and leisure options that may not be fulfilled
via online shopping. The gen next mall features play options like ski slope, go
karts, balloon rides, bowling and billiards.

From the
tenant mix concept, innovative and gen next malls are strategically realigning the
types of differentiated stores and options that will elevate customer delight
and joy. Anchor tenants that drive the mall traffic are still critical, but a
new emphasis on a curated mix of smaller stores that add a sense of novelty to
the mall offering. Additionally, some malls in India are making optimised use
of temporary, flexible spaces that can accommodate different stores over time. Theme
launches, Car launch, Movie Audio launch, Kiosks, Regular Pop up stores,
showroom spaces provide customers with a sense of the unexpected and elevate
their joy.

It is critical that these shopping
malls should be more than the stores present in them. The mix of tenant/public
space is currently shifting from the current 70/30 to 60/40, or even 50/50.The
stores generate additional traffic for the malls while maximizing ROI. Other
commercial real estate opportunities that can add additional revenue to the
malls are hotels, office buildings and airports.

It was found that people preferred
going to malls either in large groups or single. This suggested that the reason
for this behaviour was because the mall supported social interaction. Studies
have shown that the social nature and atmosphere of the mall contributes to its
profitability and popularity. Consumers find a motive, be it social or
psychological, to go to malls and purchase beyond the necessary purchases.
These are mainly that type of consumers who view shopping as a social and
recreational outing rather than a necessity. “The retail trade centre has
historically been the setting for cultural and social events. In contemporary
society, the shopping mall is the retail trade centre. It is an arena which
fosters community interaction and exchange of information, a function
previously served by the farmers market, the church, or the pub”. The social
interaction in the shopping mall was more akin to that of the local farmers
market than the super market. This happened because the interactions that
happened within the people visiting the malls and amongst the buyers and shop
owners in the mall was of the similar intensity of that of the local farmers
market. In a typical farmers market, the sellers and buyers engage in
conversations thereby increasing the satisfaction level. However a typical
supermarket does not encourages customer engagement at that level, and without
any additional incentive to be there other than the purpose of buying things, people
feel more attracted towards a shopping mall compared to that. The image of a
store present inside a mall and the one situated in the downtown shopping
district was different as well. People tend to prefer the stores in the mall
compared to the store outside as it felt more sociable. This factor reinforces
consumers buying behaviour.

By 1970’s it was reported that
Americans were spending more time in the shopping mall that any other place,
other than work or home. The “mom and pop” stores, individual specialized shops
lost its charm. People of all age group started thronging the shopping malls.
They regarded it as a clean, convenient, safe and cheerful place compared to
other downtown stores. It had become a place where senior citizens could roam
around securely in comfort, where parents take their kids to see Santa Claus,
teenagers socialize and singles court. People preferred going there when there
was nothing better to do. Thus it lead to a study which felt that “there is
something social going on in the mall”. Part of the success of the retail mall
was attributed to the socially stimulating environment that it offered. People
felt more satisfied after visiting a shopping mall because of the level of
social interaction they had. This was found through a study where the
composition of people visiting a downtown shopping area and the local shopping
mall was compared, along with it social behaviour in the shopping mall and the
stores in mall were compared to that of stores that were situated in shopping
centres or downtown shopping district. This study gave a detailed insight into
the Psychology of the people visiting the shopping mall and the reason they
prefer to go there compared to other shopping areas.

The objective of this study is to understand
the various dimensions of customer relationship in shopping malls and how it
impacts customer satisfaction: