Online shopping

Are physical malls still relevant with the rise of online shopping?

Shoppers are seen at a mall in Kuala Terengganu on April 23, 2022. – Bernama photo

KUALA LUMPUR (5 May): Despite the rapid growth pace of the e-commerce industry which has seen the emergence of various local and international online shopping platforms during the Covid-19 pandemic, physical shopping malls are still extremely relevant among Malaysians.

Sunway Malls & Theme Parks Managing Director HC Chan told Bernama that so far in 2022 the company has performed better than expected, leading to the conclusion that physical malls are still relevant. , the strongest seeming to prosper the most.

“Our performance in the first quarter (Q1) 2022 saw sales and traffic recovery exceed 100% in most areas, with the exception of travel-related retailers, but we expect their performance to increase slowly from now on. “, did he declare.

The President of the Malaysian Mall Association, Tan Sri Teo Chiang Kok, said that although Malaysians have embraced online shopping over the past two years due to lockdowns and restrictive standard operating procedures (SOPs), they much prefer to do their shopping physically.

“A recent survey showed that more than 75% prefer to visit malls for experiential shopping because they enjoy the ambiance and meet up with friends for food and drink, entertainment and shopping,” a- he declared.

According to Bank Negara Malaysia’s Financial Stability Review Second Half 2021 report, the rise of e-commerce is set to transform, rather than replace, the role of physical shopping malls.

In Malaysia, the central bank said, online retail activity grew by an average of 18.4% in 2021, with e-commerce expected to nearly double its current share of total retail sales over the next two years.

“Retailers and mall owners have responded to this shift by pursuing omnichannel retailing and offering convenient services while striving to balance the highly tactile shopping experience consumers want and need. a safe and efficient shopping experience.

“More and more retailers are also reconfiguring their physical presence in malls to provide a new and more immersive experience, in order to maintain their appeal to customers who have grown accustomed to shopping online,” the Bank report said. Negara.

Chan said the company recognizes the immense potential in the e-commerce industry, especially when taking a hybrid approach.

“That’s why we launched our Sunway eMall last year, to expand the footprint of our shopping center group in a wider market beyond the catchment areas of our physical shopping centers. With this omnichannel business, we gain the best of both worlds.

“Sunway eMall opens up new markets and opportunities for us, complementing our 4.5 million square feet of physical retail space from seven malls, simultaneously merging the presence of these seven physical malls into one mall. digital,” he said.

Overall, he said, the transition to the endemic phase sends an important psychological signal and Sunway Mall sees the beginning towards normalcy.

“It creates certainty, which is important for businesses to thrive, and we expect the second quarter of 2022 to be quite strong and robust, if there is no serious derailment,” he said. he declares.

Kok agreed that buying online has transformed shopping and retailers need to embrace and integrate elements of online selling into their physical stores.

“There are retailers who started their business as an online model but moved into stores, and vice versa. The mall business is constantly evolving and needs to embrace change in order to be competitive. and maintain itself,” he said.

Looking ahead, Chan said the company is optimistic about the ability of the mall industry to recover as Malaysia slowly returns to a state of normality.

“In the coming days, we are looking forward to a strong second quarter of 2022 with the Raya festivities contributing to a significant improvement as the exodus from the ‘balik kampung’ is now permitted.

“This will lead to significant festive expenses. In the longer term, shopping centers will need to continually build trust with business partners and patrons, enhancing its role and relevance to the community. Malls that adapt quickly to market demands are more likely to thrive,” he said.

Kok said attendance in the first two months of 2022 was promising as it coincided with the season leading up to Chinese New Year (CNY).

Traditionally, mall traffic has been slower after CNY, but the degree of decline has been less than expected, possibly due to growing confidence with the country transitioning to the endemic stage and the need for s venture after two years of restricted access. — Bernama