Shopping Centers Today International

JAN 2016

Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)

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Page 40 of 59

Digitally connected centers to thrive Gareth Jude, Retail Industry Executive, Telstra Global Industry Development Team Sydney, Australia The most important technology impact- ing retail in 2016 will continue to be the smartphone. The smartphone has changed the way people shop forever. It has created the omni-channel shopper who wants to shop anywhere, anytime, on their terms. As managers of physical assets, shop- ping center operators face both threats and opportunities from the omni-chan- nel world. On one hand, shopping cen- ters face a more-empowered consumer. Consumers' shopping options have increased dramatically, and they no lon- ger need to be in a physical location to make a purchase or gather information on products. On the other hand, shop- ping centers have a great opportunity to join the omni-channel world and make shopping in a center even more relevant for digitally connected consumers. Another big consideration for shop- ping center owners is the data that can be collected from these digital interactions with consumers, and its potential both as a source of insight into consumer be- havior and a source of new revenue with advertisers. A digitally connected center delivering an omni-channel experience potentially means happier customers, higher sales, happier tenants, and a flow through to higher rents, new sources of revenue and higher asset values. Responding to the omni-channel opportunity is one thing, but thinking about the role of physical space in the new omni-channel world is another. Retail space used to be primarily trans- actional. "Stack 'em high and watch 'em fly" was a standard retailer mantra. For shopping centers, the priority was maxi- mizing the rental yield of every square inch of real estate. Physical locations are now just part of a retail journey — but they are the only part where a personal connection can be made with the shop- per. This means that how engaging your physical locations are to visit will become much more important than how much merchandise is crammed onto the floor. Convergence continues David Jaffe, President and CEO, Ascena Retail Group Inc. Mahwah, N.J. Omni-channel commerce continues to be an important issue for us, owing to the increased use of mobile technol- ogy. Today retailers need to provide the customer with the flexibility to shop when, where and how she wants. We're investing significant resources in product design and development, maintenance of our store fleet, and in our omni-channel platform, which will allow us to deliver an excellent experi- ence for our customer, regardless of channel. We also see the customer voting for value in 2016. This has been a big part of the success of off-price retailers. That value orientation will continue, attracting new players to the U.S. mar- ket, like Primark. Customers will opt for fashion and service, or low price. J a n u a r y 2 0 1 6 / S C T 41 Brighter industry outlook for 2016 Stephen D. Lebovitz, President and CEO, CBL & Associates Properties Inc., and ICSC's 2015-16 Chairman Chattanooga, Tenn. Last year was a solid year for the shopping center industry. The year began with a rash of specialty store closings, including the closing of Ra- dioShack and Deb Shops stores, but leasing demand improved steadily as the year progressed. Occupancy rates moved back towards the record lev- els we saw at the end of 2014, and

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