![](\"..\/images\/spacer.gif\"){kind=spacer}
Sayantani \n Kar, Business Standard<\/i><\/p>\n Sayantani \n Kar, Business Standard<\/i><\/p>\n
Mumbai, \n 16 February 2015 <\/i><\/p>\n
![](\"..\/images\/mall-select.jpg\")
When \n the million-square-foot mall broke into the concrete jungle in \n 2007-08, onlookers worried the local markets would find it difficult \n to sustain. But the Indian consumer proved to be less brand conscious \n than expected. The neighbourhood markets dodged the doomsday predictions, \n and continue to coexist. But the destination malls took a toll \n on their smaller brethren, especially in heavily-contested catchment \n areas.<\/p>\n
In the last two years, it has been reported that no less than \n 30-40 malls have downed shutters. But, even though thrice that \n number of malls have come up, retail analysts say most lie vacant \n because they don’t meet the criteria brands have. Standalone brands, \n anchor stores, restaurants and multiplex chains usually make up \n the tenant mix. What do brands, then, look for in a malls?<\/p>\n
Devangshu Dutta, chief executive, Third Eyesight, a retail \n consultant, says, "Brands have to weigh whether they can \n be supported in a catchment area or not. If a rival brand is present, \n it could mean that it has primed the customer for the second brand’s \n merchandise." Delhi and Mumbai and their satellite cities \n have seen malls come up in the same neighbourhood, leaving brands \n to mull whether to jump ship or straddle both.<\/b><\/p>\n
There is, of course, the set of hygiene factors. Brands agree \n that location is the most critical. As is the track record of \n the developer, its credibility and marketing skills. The layout \n of the mall, to allow the crowd to circulate evenly, and not get \n concentrate in certain pockets is important. The tenant mix, parking, \n accessibility and maintenance become more important as more malls \n vie for the same audience in larger cities.<\/p>\n
Atul Chand, divisional chief executive, ITC Lifestyle Retailing, \n says, "Outdated malls with tired concepts have lost footfall \n to new developments. A brand would have to take a call on a transition \n in order to stay contemporary. Constant reviewing will also help \n decide whether stores in both can be viable or not."<\/p>\n
Sadashiv Nayak, CEO, Big Bazaar, the hypermarket of Future Group, \n says, "If we have Big Bazaar in a town, say Nagpur, and another \n mall comes up that we would like to be in, then we turn to our \n other brands such as Food Bazaar or FBB (fashion store), as these \n are distinct from each other."<\/p>\n
PVR, the leading multiplex chain, recently found one of the malls \n it was present in, in Mumbai’s suburbs (Mulund), decide to wrap \n up. Nirmal Lifestyle, a 500,00-square-foot mall, opened in 2003, \n could not keep up with competition. Sanjay Kumar Bijli, joint \n MD, PVR, says, "We did well, got a lot of support from the \n developer. We have no regrets but a competing mall came up in \n the neighbourhood and the footfalls shifted to it over a period \n of time. You can’t always help such a scenario. But we have tried \n to counter it where possible. A case in point being Whitefield \n in Bangalore. We are in the Phoenix mall and also in VR, coming \n up next to it. The malls’ positioning is different from each other. \n Phoenix caters to a large population in the upcoming suburb, while \n the PVR in VR would have more Gold Class theatres and IMAX."<\/p>\n
Dutta says, "Brands need to see whether the developer \n identifies the customer and builds around it. Select Citywalk \n is doing the best among malls in Saket, Delhi, because it homed \n in on the South Delhi woman as its customer and actively curates \n the brands, even culling those that don’t click."<\/b><\/p>\n
Nayak agrees, "We look whether the mall owner’s wavelength \n matches our customer-centricity or not." Chand says that \n a tenant mix with the same target audience, rather than a general \n mix, helps collectively woo the shopper to the mall.<\/p>\n
Nayak says that with standalone stores outnumbering Big Bazaar’s \n mall stores, the strategy is agnostic of format. Big Bazaar has \n to be accessible by private vehicles and public transport because \n of the cross-section of audience, and have smooth movement inside, \n and have parking, washrooms etc.<\/p>\n
Darshana Shah, senior vice-president, marketing and visual merchandising, \n Hypercity (Shoppers Stop’s hypermarket), says, "The financial \n viability is a big factor. Besides revenue share, developers also \n share the capex, especially in tier-II towns. Malls get in trouble \n when they sign up anchor stores but fail to attract smaller tenants \n and some of their floors remain empty." Chand reminds that \n "size matters because it means more categories to keep the \n consumer engaged, with but doesn’t work without requisite infrastructure."<\/p>\n
Veteran retail consultant and founder of Trrain (Trust for Retailers \n and Retail Associates of India), BS Nagesh, warns brands to not \n cite e-commerce as an excuse, "Brands have panicked due to \n e-commerce competition and in malls, they seem to have forgotten \n the other elements that add up to their experience, and are only \n saying it is the price and going in for frequent sale. As a result, \n it has affected them and the malls. We see people in the food-court, \n so brands need to rethink ways to get them back to their stores. \n But you can’t devalue the brand just because of online competition. \n Online sales are around 5 per cent, while modern retail are 8-10 \n per cent, so why not look at the 85 per cent that is there for \n the taking."<\/p>\n