Mushrooming Malls and Dynamics of Successful Malls

Shopping at malls is becoming a popular phenomenon world over. There is a huge sum invested in such properties beginning from its development to managing, leasing, marketing and so on. So the big question is - How can mall developers maximise the returns on their investment? Malls across India have turned out to be the central institution of modern shopping culture. The environment is full of choices and lures, which takes the consumers’ soul into the temptation of buying the world. People of all races, creeds, ages, and social status flock to shopping centres to participate. The ascendancy of malls as a significant shopping, social interaction and entertainment destination has a major impact on retail strategies and the retail landscape in numerous Indian companies. In India malls are amongst the very few options available where people can conveniently shop keeping in mind the country’s extreme weather conditions, lack of utilities such as absence of washrooms and parking spaces on high streets. Another reason for the growing mall culture in India is that the country is currently deprived of good entertainment places where people can spend quality time with their families, and  hopping centre is perhaps one such great entertainment place.

With the increasing number of malls in India, and many more in the pipeline, mall management has been identified as the key to success of malls. Therefore, it is critical to have a well thought-out mall management strategy and the first step to address this urgent need is to understand the factors that determine mall management. With malls becoming the preferred choice for shopping these days, it is clear that the retail real estate industry in India has a promising future with lots of growth opportunities. However, managing a complex entity such as malls is not easy. Therefore, it has become all the more imperative for mall managers to take into consideration the needs of all the stakeholders such as customers, retailers, employees and statutory bodies.

With the mushrooming of malls in India, the competition among them is becoming intense. As the competition intensifies, the need of the quality mall management becomes evident. A major challenge for mall developers these days is attracting and winning over the hearts of increased number of customers and retailers, although it brings ample opportunity in disguise to serve the lifestyles of the shoppers through deliberation of mall experience. Since shoppers today are quite informative and value their time and money, the priorities on which they evaluate the services of the malls generate a lot of challenges and opportunities for mall developers and retailers to study shoppers’ preferences while selecting a shopping destination. Against the backdrop of shoppers’ choice of the shopping malls, it is necessary to have a look at the determinants of mall management which shoppers assess before gathering an enjoyable experience. Mall management implies positioning a mall, attracting the best tenants, formulating tenant mix policies, promotions and facility management. The influx of malls in India as cynosure of social activity becomes instrumental for the retailers to acquire space in shopping centres. Malls’ ambience and facilities become the competitive advantage for retailers as these attract and induce more foot-fall in the region.

The initial work starts with the location analysis. An important dimension of mall management is its location as in India nearly majority of the visitors depends upon public transport facilities. People who frequently visit the mall are those who stay nearby, so proximity to home or work place is an essential criterion of any shopping centre. Other factor which comes under consideration while formulating the strategy is the anchor tenants. Anchors in the malls are chosen very carefully since they are the footfall generators for the entire mall. For example, apart from multiple luxury brands available in the malls, almost all malls do accommodate multiplexes and departmental stores/super markets – the latter being the footfall generators. The promotions and the other activities constitute to the differentiating factor of any mall. Promotions such as monsoon bonanza, winter offer, festival arrivals, etc. are few which we often come across. Other activities such as contests, celebrities’ appearances, musical events, etc. are few things through which malls try to allure more footfall. Brand positioning of the mall is also very critical. While national and international retailers set the brand positioning of a mall, regional tenants add uniqueness to it, which help them stand out of the crowd. Stressing that there should be a fine balance of national, international and regional retailers in any particular mall. Localising the mall in tune with the local needs and preferences of the catchment thus becomes very important. This becomes all the more important as today’s consumer owes no loyalty for a shopping centre unless it meets her high expectations and has something unique to offer.

Road Ahead for the Global Banks

Four years after the genesis of the global financial crisis, the global banking sector is still struggling to come to grips with the fact that regulators around the world have set out to fundamentally change the way banking operations are conducted. Here are few of the challenging fronts and how the road ahead for the global banks lies:

• Regulatory environment. In the wake of the financial crisis, numerous regulatory changes have been implemented or proposed, but the regulatory future remains unclear. Two scenarios envision a regulatory environment much like that in place today or likely under laws and rules in the pipeline. Two others imagine worlds in which regulations are much more onerous.
• Economic shift. BRICS nations such as China, India, Brazil, and other growth markets are likely to account for a larger share of the world’s economic activity, providing opportunities and challenges for banking. Two of the scenarios assume that the role of emerging markets will evolve at a relatively slow, incremental pace, while the other two assume that a shift in economic power will make this factor more significant in determining banks’ prospects over the next decade.

• Globalization. In many industries, companies now compete in a global market. While a global strategy can boost revenues, it can also put pressure on earnings and draw criticism from locals concerned about lost jobs and unfair competition. Two of the scenarios imagine worlds with an ever-growing degree of globalization and market integration. One envisions pockets of protectionism, and one anticipates a turn toward protectionism around the world.
• Type and degree of competition. Banks are facing new competitors, including institutions in emerging markets and nonbank companies such as utilities, retailers, and mobile services providers. One scenario anticipates limited impact from new competitors; one assumes non-traditional competitors will move into some of the most attractive market niches; another assumes such competition will be significant mainly in emerging markets; and one envisions a surge of competition from nontraditional banking providers around the world.
• Financial crises. Two crises have occurred in the past decade. Will these so-called black swan events be common in the future? One scenario anticipates no financial crises during the next 10 years; another envisions massive crises with worldwide impact; a third calls for smaller crises with limited impact; and the fourth envisions massive crises affecting mainly the developed world.
• Lender of last resort. Central banks have stepped in to shore up the financial system in several recent crises, most recently the credit crisis that began with the mortgage market and home-price collapse in the United States and the debt crisis in Europe. Two scenarios assume lenders of last resort will continue to provide safety nets, while two assume this source of back-up funding will no longer be available.
• Debt situation. Mushrooming government debt is a serious issue in the United States and in Europe, where in many cases governments have shouldered private sector—including bank—liabilities. Two scenarios assume this debt will be contained to manageable levels; a third envisions a moderate worsening of the situation; and the fourth assumes the situation will dramatically worsen.
• Securitization market. In the wake of the global financial crisis, production of private-label, mortgage-backed securities has all but ceased in the United States, leaving most of this market to government-sponsored entities. New regulations are designed to encourage more standardization of these and other asset-backed securities while driving trading from OTC markets to exchanges. Some experts expect this to make the securitization business less profitable. One scenario assumes the private securitization market will recover; a second assumes it will continue to be limited in scope; and the third and fourth assume it will find equilibrium somewhere in between.
• Retirement environment. Populations are aging in many developed countries, putting stress on government programs while also raising demand for retirement-oriented products and services. Two scenarios assume government-funded services for senior citizens will be financially stretched, but capable of delivering most of the services promised, while two scenarios assume many of these systems will collapse.
• Role of technology. Technological advancement is inevitable, but unpredictable. Advances in front- and back-office technology may make banking operations more efficient and improve real-time understanding of opportunities and risks. One scenario assumes advances in both front and back offices will be only incremental, while a second assumes significant advances will center on risk assessment and improving back-office operations. A third assumes technological advances will transform operations throughout the business, and the fourth assumes transformation will mainly take place in the front office.
• Customer empowerment and posture. The Internet has made it easier for consumers to shop around for financial services. It has improved price transparency, and provided easy dissemination of reviews and critiques of products and services by experts and other customers. At the same time, recent regulations are forcing credit card issuers, mortgage lenders, and other providers of financial services and products to disclose fees and contract terms more clearly. One scenario assumes a low-pressure environment for increased consumer power. Two assume the pressure will be high and that consumers will adopt an adversarial attitude toward financial providers. The fourth assumes consumers will gain power, but not feel adversarial when dealing with their banks.
• Credit protection rights. During the financial crisis, government bailouts tended to protect creditors’ rights, often making owners of bonds and debt-related securities whole while leaving equity holders with deep losses. Critics argue that in the future, creditors should share such losses. Two scenarios assume that creditors’ rights will be relatively low or diminished from current levels, and two assume they will be relatively high or as strong as or stronger than they are today.