With 15.8 million visitors during 2017, Dubai is ranked as the sixth most visited city in the world, after Hong Kong, Bangkok, London, Singapore and Macau. The popularity of Dubai as a business and holiday destination is partly due to its well-developed infrastructure, which appeals to business travellers, and the extensive shopping experience on offer. At last count there were more than 60 different shopping malls open to the public, with more being planned and built all the time.
The recent development of global theme parks, like Legoland and Motiongate, is Dubai’s attempt to also tap into the huge family market, but the shopping malls are definitely going to remain the larger attraction for the near future.
Building relationships
With the tourists spending quite a large chunk of their holiday money at the malls, many retailers are still not sleeping well at night as they are trying to figure out how they can survive the fierce competition. It’s a bit of an ‘innovate or die’ moment and shops are realising they need to look into new ways of selling. Typically, people and companies are not very good at dealing with change or uncertainty, but for the malls and the shops within them to survive, and ideally thrive, there is an urgent need to change by innovating the shop floor. For many, this may be a very scary step into unchartered territory.
We are seeing the behaviours of customers starting to change, consequently retailers will need to change the way they are operating, too. Shops can no longer expect customers to come to their store because of the products they sell, as these are already easily available online, and in many cases at a lower price. Instead, the shops need to give customers an incitement to enter the store. The latest trend is to be focusing on creating experiences and by building relationships with the customer rather than just racking up transactions.
Surprise, advise and entertain
To succeed, shops are recommended to try finding ways to ’surprise, advise and entertain‘ customers by offering unique experiences that a website can’t provide. As our lives are getting busier, customers are also looking for convenience; this could be as simple as availability of parking, transport links, walking distances, opening hours, closeness to other relevant shops, etc. Modern customers also require the guarantee that the things they want will be available from shops at the same time.
Customer retention
Keeping an existing customer is much cheaper than finding a new one. This is one of the reasons why across the consumption industries, companies are reviewing and amending the way their rewards programmes are created. Just like the airlines and grocery stores are overhauling their loyalty programmes to reward the bigger spenders, the poker industry has modernised the way they provide rewards to keep customers, and shopping malls are actively looking at ways of increasing the footfall and resulting spend.
In a tourist metropolis like Dubai, the challenges are even bigger as many visitors don’t naturally come back on a regular basis. On the plus side, many of the customers have chosen to come to Dubai for the extensive shopping on offer and they are there to spend money.
Engaging the customers
To thrive, and not just survive, malls and individual shops must focus on creating memorable experiences and provide things that a website can’t offer. We have already seen malls with spas, an underwater zoo, ski slopes, skate parks, swimming pools, children’s experience centres, etc. Shops must also ensure that the wait times are kept as low as possible, so customers are following through on their purchases, rather than leaving the stores empty-handed due to long queues or having no one available to help them. The malls can improve their customers’ experiences further by introducing additions like apps for parking, flexible concierge services, and by bringing offline and online experiences together. A loyalty or rewards system aimed at tourists may also be a strong way to increase the number of returning visitors in cities like Dubai.
