The centre of the futureFuture
Aneta Cichla, ‘Eurobuild CEE’: ECE Future Labs was set up in 2013. Could you tell us what it is currently involved in?
Joanna Fisher, managing director, centre management, ECE Projektmanagement: At the start it was a small think tank for analysing the various digital projects for shopping centres. Since then, the department has expanded so much that its remit now includes large pilot programmes such as the Digital Mall, which we are testing in the Alstertal Einkaufszentrum mall in Hamburg. At this time we are working with 30 large chains and we have over 200,000 products in our virtual centre. We are constantly working on increasing the number of tenants in the programme and on the technical aspects of the project. We work on the assumption that a shopping centre is a platform that combines various forms of retail. This is why we are focusing on a few projects. One is the development of omni-channel sales, which we have been analysing very carefully. Another important topic is customer tracking, that is, observing how customers move around a shopping centre, how they behave, who they are, how much they spend on shopping, what they are interested in and what attracts their attention and whether they are interested in food and entertainment – we are looking at how to further expand these service in our centres, for example, by adding playgrounds.
Monika Pyszkowska, director, centre management international for the Czech Republic, Lithuania,
Poland and Slovakia: We have also been gradually implementing our ‘3Es strategy’, which has always formed part of our philosophy for facility design, leasing and management, that is: Emotion, Entertainment and Excitement. These elements have always been very important to us. Currently we are focusing on introducing these factors into food and beverage areas, which have become an important part of shopping centres. Hence our plans to refurbish and modernise the older food courts in our centres, including in Poland.
What are the results of your research into omni-channel sales?
Joanna Fisher: The level of development of omni-channel sales depends on the country. The UK and Germany are the leaders in online shopping in Europe. Central European countries are still developing in this respect. There is still a lot of work to be done in retail in terms of streamlining logistics and deliveries. Retail chains have invested in separate systems for their bricks-and-mortar and online stores, but if we want to operate efficient omni-channel sales these systems have to be integrated. This requires a huge investment in IT.
Monika Pyszkowska: However, for the whole shopping centre to function smoothly and effectively, the activities of managers have to be coordinated with the tenants. Our task is to create a platform where all the stores in our shopping centres will be able to display their product range online. However, this would only apply to their products that are actually available in the store in the centre. This is an innovation that we are still testing out.
In Germany you have devised such food court concepts as Foodtopia and Food Sky. Can we expect similar formats to appear in other centres outside Germany?
Joanna Fisher: Foodtopia is a unique project. There are no other food and beverage areas in Germany that are designed, laid out and operated in this way. The entire fourth floor of the mall will be devoted to entertainment and food. This will include a cinema and a variety of restaurants, including some that have not been on the German market before. Food Sky is a new format, which also features vegan and vegetarian restaurants.
Monika Pyszkowska: We devise each food court concept individually to match the centre. In Polish shopping centres we have been seeing a growing demand for space from restaurant operators. This might even reach as much as 20 pct of the entire centre in some European countries.
At Silesia City Center we are close to completing the refurbishment of the restaurant section. We are redeveloping the food court and will be re-opening it at the end of October. This will be divided into zones for various types of customers and these will merge into each other, so everyone will be able to find something for themselves there.
The growing importance of entertainment areas in shopping centres has been much talked about recently. ECE only has two malls with cinemas in Poland. Are you planning to bring any other cinema operators into your centres in the country?
Joanna Fisher: We have been looking into having more cinemas in ECE’s centres. We have also been closely monitoring the development of cinema chains. Their owners are also concerned about the direction in which cinemas will develop. We have been working on having more cinemas in food zones in all our markets in Europe, as we have done for Foodtopia. The fact that we lack such projects does not mean that we are not going to be developing any soon. Catering and entertainment areas have been moving closer to each other recently. We need to remember that the entertainment areas in shopping centres also have fitness clubs, smaller entertainment areas, interactive games that use mobile apps, children’s play areas and, most of all – a suitable tenant mix.
So what are the most important challenges ahead for mall managers?
Monika Pyszkowska: Consumer behaviour has been changing very fast, much faster than a few years ago. The right way to react to this is to see it as a challenge. The other important challenge has been to create the right conditions for our tenants to do business. Because of this we are trying to offer space that suits their concepts, and by doing so we can together increase the footfall in shopping centres and their turnover, while both parties are better able to respond to changing customer habits and adopt an approach that is even more focused on the customer.
Your company has also been adding new services for the visitors of your shopping centres. What have you learnt from this?
Joanna Fisher: We are currently working on the At Your Service project, which we are rolling out in all the centres that the Otto family has a stake in. We have identified six important points in the ‘customer journey’, which will help customers connect with what we are offering them. This kind of extended customer service has its place among all the important matters we have discussed. It increases the value of shopping centres and represents added value for investors. It does not generate a direct return on investment but it is very significant. Investors will undertake such activities purely for the customer to feel better in shopping centres, which is intended to generate returns in the long run by fostering their loyalty. Some of these approaches will certainly be introduced to our Polish centres.
What do you think an ECE shopping centre will be like in ten years?
Joanna Fisher: It is difficult to give a clear and unambiguous answer to this question. We now have a vision for the development of our company and our projects for 2025. I suspect that in 2025 we will laugh at some of the things we thought about in 2017. But some of them will become part of reality. What seems important to us now in the context of the future of shopping centres has to do with logistics – and streamlining this, to be precise. We want tenants to have the means for products to be ordered online and delivered to a specified destination directly from their store in the shopping centre. It would be even better if it was possible for the products ordered online to be processed and collected in the store. So the issue of warehouse space takes on an added significance here. Shops in shopping centres will soon be capable of providing both services. They will become both physical stores and places for delivering goods to customers. This is a very difficult issue to solve, and a very expensive one, too. Players on the retail and logistics market are currently wondering which is the best solution to cover the ‘last mile’ to the customer quickly and efficiently.