Consumption Trend for Shopping Center Development

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CONSUMPTION TRENDS FOR SHOPPING CENTRE DEVELOPMENTSECTION II

onsumption is bound to be high in acountry of 1.121 billion but it is really thequality of consumption that will actually

portray the potential for retail and realestat e growth. The quality of

Cconsumption, in turn, is a direct function of t heoverall growth of the economy, and factors ensuringsustainability of the growth momentum.There is undoubtedly an all round buoyancy in theIndian economy with GDP growth coming closer tothe double-digit figure, and a booming servicessector. Rising incomes have fueled the growth of anew class of consumers, mostly young, whosespendings are quite independent from the traditionalfamily ways. This change in lifestyles is a result of therising disposable incomes of this young consumerbase.

CONSUMPTIONTRENDS IN INDIA

ConsumersatthePantaloons,

Gariahaat,Kolkata

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India possesses an enormously vast pool ofhighly skilled professionals in the knowledge andtechnical domains, nearly two lakh engineersgraduating every year; and yet experts believethat this number may fall short of the ensuingdemand in the coming years. Urban jobs arereported to have increased by nearly 23 percentin 2006. The government of India has only

recently taken cognisance of this growingdemand of skilled manpower by announcing adoubling of the countrys premier technologyand management institutes.

The last couple of years have seen an annualincrease of 15-20 percent in salaries of theemployed, which has in effect reduced t he chasmbetween the middle class and the affluent. It isestimated that the great Indian middle class will As per the 2005-06 private final consumptioncomprise 32-35 percent of the population by break-up, the highest head of household2010. expenditure is on Food & Beverages: Rs.870,170

crore, a 8.4 percent growth rate over 2004-05,That the growth in consumption is not limitedwhen household F&B expenditures stood atjust to the met ros and large t ier-II cities isRs.802,753 crore.evident from the fact that more than one-third

of the mall developments and a significant The fastest growing head of domestic householdnumber of the upcoming hypermarkets and large expenditures was t he communication segmentdepartment stores are happening in the t ier-III (28.4 percent), with a spend of Rs.49,546 crorecities. over previous years spend of Rs.38,601 crore.

The other fast growing household expenditureOver the last couple of years, Retail and Realheads are leisure and entertainment (18.4Estate are among the fastest growing sectors inpercent growth over 2004-05), followed bythe Indian economy. Global industry analystsspends made on consumer durables (16.3 percenthave time and again confirmed the country'sgrowth rate) and clothing (16.1 percent growth).potential as one of the most attractive emerging

retail markets of the world. The increasedconsumer demand, improved sourcing options,liberalisation of investment policies, and largeravailability of real estate, coupled with higherdisposable incomes and changing preferences of

consumers are together creating the foundationfor significant growth and revolution in the retailand retail real estate sectors.

IMAGES F&R Research estimates reveal that thePrivate Final Consumption Expenditure in India(domestic market) for year 2006-07 at currentprices stand at Rs.2,340,000 crore. Theseestimates put t he growth rate at 11.8 percentover the previous year in the backdrop ofinflationary pressures prevalent during theperiod. Private consumption expenditure in2004-05 was to t he tune of Rs.1,890,619 crorewhich increased by 10.7 percent to Rs.2,093,787crore in 2005-06.

Food & Beverages 48.6%

Miscellaneous

Personal Goods &

Services n.e.c.2.5%

Gross Rent , Fuel &Power 18.8%

Transport 4.5%

Leisure & Entertainment 1.0%

Education 3.3%

Medical & Health Care 5.6%

Personal Care Products &

Services 2.7%

Consumer Durables 8.3%

Footwear 0.7%

Clothing 4%

Private Final Consumption Expenditure: Rs. 2,340,000 Crore (2006-07)

PRIVATE CONSUMPTION EXPENDITURE SHARE: ALL INDIA

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The growth rate of domestic household spends on leisure and Private Consumption expenditure is highest in the North zoneentertainment, however, came down from 2004-05, when the (more than 700,000 crore) and lowest in the West.segment had clocked in the highest growth rate of 28.3

A realistic indication of consumption expenditure obtaining frompercent over spends made in 2003-04. Another significant

specific zones, states or cities is obtained from the average annual

expenditure segment is healthcare and medical expenses per capita expenditure. The national average for Rural areas is(Rs.138,053 crore, indicating a 15.1 percent growth over lastRs.17,287 and for the urban centres it is Rs.Rs.29,652. Zone-wise,

years household medical expenses). Recent announcement byaverage consumption is highest for rural areas in the South

Reliance industry to set up over a thousand heath care(Rs.21,621) followed by the North (Rs.17,064), East (Rs.16,184)

facilities across the country is an aim towards providingand is lowest in the West (Rs.14,959).

quality services in this segment.For the urban centres, average per capita private consumption

This report analyses shopping centre developments in Indiaexpenditure is highest in the West zone (Rs.30,734) with the

across four broad geographic zones. In view of that, a generalSouth zone slightly behind at Rs.30,238 followed by the North

overview of the level of private consumption expenditure(Rs.29,398) and East (Rs.27,599) in the order.

across these zones is worth mention. In 2006 the populationof India is estimated at 1,121 million and the population ishighest in the North zone (342 million) followed by the East

As per Images F&R Research estimates, the Indian Retail market is(311 million), South (238 million) and the West zone (230estimated at Rs.10,98,000 crore (at constant prices) an ismillion) in the order. In line with the population figures,

THE INDIAN RETAIL MARKET

Current price Rs.Cr

2003-04 2004-05 Growth Rate 2005-06 Growth Rate

FOOD & BEVERAGES 760,434 802,753 5.6% 870,170 8.4%

Cereals, bread, pulses, sugar/gur, spices, oils/oilseeds, etc 312,879 322,730 3.1% 338,427 4.9%

Fruits & Vegetables 149,721 158,190 5.7% 168,741 6.7%

Milk & milk products 114,502 120,598 5.3% 132,958 10.2%

Meat, egg & fish 71,397 77,551 8.6% 83,416 7.6%

Tobacco, pan & intoxicants 36,507 32,082 -12.1% 37,022 15.4%

Coffee, Tea & cocoa 14,558 19,472 33.8% 22,392 15.0%

Beverages 28,501 36,084 26.6% 45,627 26.4%

Catering (Hotels, resturants, etc) 32,369 36,045 11.4% 40,810 13.2%

CLOTHING 79,372 88,548 11.6% 102,764 16.1%

FOOTWEAR 10,569 11,870 12.3% 11,877 0.1%

CONSUMER DURABLES 58,498 66,199 13.2% 76,985 16.3%

Home Appliances / Equipment & Services 37,176 43,744 17.7% 51,582 17.9%

Household Furniture, furnishings, utensils & services 21,322 22,455 5.3% 25,412 13.2%

COMMUNICATION 31,722 38,601 21.7% 49,546 28.4%

PERSONALCARE PRODUCTS & SERVICES 50,071 53,924 7.7% 58,613 8.7%

MEDICAL& HEALTH CARE 103,209 119,972 16.2% 138,053 15.1%

EDUCATION 38,806 43,810 12.9% 49,919 13.9%

LEISURE & ENTERTAINMENT 29,360 37,669 28.3% 44,602 18.4%TRANSPORT 253,510 292,814 15.5% 323,029 10.3%

Personal Transport, accessories, operation & maintenance 102,364 119,514 16.8% 126,457 5.8%

Public Transport services 151,146 173,299 14.7% 196,569 13.4%

GROSS RENT, FUEL& POWER 186,683 197,907 6.0% 209,833 6.0%

MICELLENEOUS PERSONALGOODS & SERVICES n.e.c. 120,054 136,552 13.7% 157,467 15.3%

PRIVATE FINALCONSUMPTION (DOMESTIC) 1,722,288 1,890,619 9.8% 2,093,787 10.7%

Heads of Expenditure

IMAGES F&RResearch estimat es based on CSO National Accounts Stat istics 2007, Ministry of Stat istics & Programme Implimentat ion, Govt of India

Growth In Privat e Final Consumpt ion Expendit ure In India (Domes tic Market) At Current Prices


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projected to grow to Rs.1,308,000 The high paced growth of organisedcrore by 2010. The organised retail retail will certainly weaken traditionalmarket, on the other hand, is retailing, but not necessarily inestimated to reach Rs.66,500 crore absolute terms. The share of organisedin 2007, and as per the prevailing retailing will increase primarily due totrends, it is likely to surpass an increase in the overall retail market.Rs.200,000 crore by year 2010. Within organised retailing, the

presence of malls will provide aThe India Retail Report 2007pegs

cushion for the t raditional retailers tothe current Indian retail market size

register a foothold in the modern retail(at 2006 current prices) at

environment. With more and moreRs.12,00,000 crore, with the size of

malls opening up, there will also be anthe organised pie being Rs. 55,000

urgency to differentiate with regardscrore. About 4.6 percent of the total to the tenant/ retailer mix. LargerIndian retail market stood organised

organised players will eventually optin 2006.

for standalone outlets for theirFood and grocery is the largest retail diversification and the traditional highsegment (Rs.7,43,900 crore) whereas street retailers are most likely to fillFashion is the largest organised the space within the malls. This mayretail segment . Comprising clothing, bring about a win-win situation for alltextiles and fashion accessories, the concerned in this rapidly changingorganised fashion market in India is retail landscape.estimated at Rs.21,400 crore.

NORTH ZONE (Delhi, Rajast han, Haryana, 248 94 342 4,236,272 2,766,750 7,003,022 17,064 29,398Chandigarh, Punjab, HP, J&K, Uttranchal, UP)

WEST ZONE (Maharasht ra, Gujarat , Goa, MP) 142 88 230 2,124,790 2,698,023 4,822,814 14,959 30,734

SOUTH ZONE (Andhra Pradesh, Karnataka, 153 85 238 3,313,561 2,558,019 5,871,579 21,621 30,238Kerala, Tamil Nadu, Pondicherry)

EAST ZONE (Chha tt isgarh, Jharkhand, Biha r, 252 59 311 4 ,079,240 1,623,345 5,702,585 16,184 27,599Orissa, West Bengal, NE States)

ALLINDIA 796 325 1,121 13,753,864 9,646,136 23,400,000 17,287 29,652

Private Consumption Expenditure Across Major Zones

F&RResearch est imates based on NSS Report No. 509: Household Consumption o f Various Goods and Services in India, 2004-05, Volume I & II and CSO Nat ional Account s Stat istics 2007, MoS&PI, Governmentof India

Rural Urban Total Rural Urban Total Rural Urban

Population-2006 (million) Consumption Expenditure 2 006-07(INR million)

Av per ca pitaConsumption Exp (INR/year)

0

2004 2005 2006 2007 2008 2009 2010

0

Organ ised Retai l Indian Retai l

OrganisedRetail(ValueRs.Cr.)

IndianRetail(ValueRs.Cr.)

250,000

200,000

150,000

100,000

50,000

1,200,000

1,000,000

800,000

800,000

800,000

800,000

1,400,000

930,00

0

980,50

0

10,36,000

1,0

80

0

9,0

,6

,000

11

41,23

4,00

0

13

800

,0

,0

28,000

35,600 74

,500 6

56

,00

96,500

140,00

0

0,000

23

PROJECTED GROWTH IN INDIAN RETAIL(Value Rs.Cr. at 2003-04 Constan t Prices)

Catering (F&B) 5%

Entertainment 3%

Books, Music, Gifts 1%

Clothing, Fashion 9%

Jewellery 5%

Furnishings & Furniture 3%

Mobilephones 2%

Consumer Electronics 4%

Pharmaceuticals 4%

Health & Beauty 0.5%

Watches 0%

Footwear 1%

THE INDIAN RETAIL PIE 2006(Market Size Rs. 1,200,000 Crore at current prices)

ColabaCauseway,Mumbai


Food & Gro cery 63%

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retail market, but its share is expected to decrease in the next Hence it is important for all to track demographic and socio-10 years as other categories like apparel, IT and consumer economic changes, evolving consumer needs and desires, anddurables are catching up fast. behavioural transformation as it takes place including buying

behaviour. It is also important to have multi-channel, pan-IndiaShares shown above are percentage shares of t he retail

strategy for those who are aspiring to hold leadership position inmarket. The share would be about 60 percent of the above

the industry in the years to come.

numbers in case they are to be seen as percentage PFCE. Forexample Food, Beverages and Tobacco would be about 40 Retail Secto r Developmentspercent of the PFCE.

The retail sector is transforming rapidly and within next five yearsThe Key Trends That Will Impact The Reta il Sector the top seven retailers are expected to invest around Rs.65,743

crore (USD16 billion). Investments in the range of Rs.90,380The three key trends have certain issues of concern associated

crore+ (US$22 billion) are expected in the next five years in retailwith them, for example the extent and likely impact of

and its supply chain alone. The size of modern retail is likely tourbanisation. Some of the issues are listed as below:

touch Rs.2,45,000-3,00,000 crore (US$60-75 billion) by 2011-12;Urbanisation implying about 15-18 percent share of modern retail. At least 25

lakh additional direct jobs are likely to be created in the next fivev How rapid is it going to be?

years. Hyper-competition is expected t o set in by 2008-9 as thefootprint of the top-six players starts significant overlapping in topv What is the likely impact on consumption and its20-30 towns. This indicates a significant impact on other retailersgrowth/trends?and branded good players creating new opportunities and

Changing Family Struct ures threats.

v What is the future family structure? In short, India is attempting to do in 10 years what took 25-30years in other major markets in the world and shall bypass manyv How is it going to impact shopping behaviour?stages of evolution of modern retail. India is likely to see

v How is it going to impact the spending power and hence emergence of several innovative India specific retail businessconsumption? models and retail formats in the coming years.

Demographic Changes India Consumers: The Largest Beneficiaries

v What would be the demographic structure of India in next There would be multiple benefits for the middle-class consumersfive, ten, 15 years? (and lower income consumers). These can be summed up as

reduction of prices in typical monthly 'basic needs' shopping billv How is it going to impact shopping behaviour?

by at least 10 percent within next 24-30 months leading tov How is it going to impact the spending power and hence generation of an equivalent amount of surplus disposable income.

consumption? It also implies improvement in quality of fresh/perishable products

Food, Beverages and Tobacco 195 65% 7.0% 256 60% 6% 342 54%

Personal Care 15 5% 11% 23 5% 9% 35 5%

Apparel 21 7% 11% 33 8% 9% 50 8%

Footwear 5 2% 11% 7 2% 9% 11 2%

Furnishings 4 1% 15% 7 2% 12% 12 2%

IT & Consumer Durables 14 5% 15% 24 6% 12% 43 7%

Furniture 9 3% 15% 16 4% 12% 28 4%

Jewellery & Watches 15 5% 12% 24 6% 9% 37 6%Medical Care & Health Services 8 3% 12% 12 3% 12% 21 3%

Recreation 2 0.6% 17% 3 1% 15% 7 1%

Others 12 4% 18% 23 5% 18% 53 8%

300 100% 9% 427 100% 8.4% 637 100%

Retail Market: The Share Of Categories

Market Size$billion 2006

% Share2006

Growth Rateb/w 2010-05

Market Size$billion 2010

% Share2010

Growth Rateb/w 2015-10

Market Size US$billion 2015

% Share2015

Above are indicative calculations onlyShare is % share of Retail market. The share would be about 60% of the above numbers in case they are to be seen as % PFCE. For example Food, Beverages and Tobacco would be about 40% of the PFCE


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of distribution of mall space.

And banish the thought that the malls are a metro phenomenon Kochi, Visakhapatnam, Surat, Patna, Guwahati are some of thecities where malls are coming up. Tier-II cities like Kochi andMysore are expected t o see at least a million square feet of mallarea added by 2010.

Malls make for a fascinating study on the subject of culturalfamiliarisation and acclimatisation.

What started out as a generalised, western-mimicked formula forsuccess is today, extremely customised and localised for the GreatIndian Middle Class.

A mall used to be the bastion of the privileged class once upon atime; in the span of 5 years it is the social networking site for thevast middle classes.

and improved assortment, and reliability of availability. A trip to the mall is not just about shopping; it is about a basicsociological need reconnecting. It is about reconnecting with theTremendous Opportunit ies for Real Esta tefast-disappearing concept of family time or with friends or even

Additional consumption of almost Rs.5,00,000 crore (About reconnecting with oneself. A mall today is like a traditional IndianUS$127 billion) will require about 6,000-7,000 lakh sq.ft of thali it has something for everybody in the family, making it theadditional retail space by 2011. Current projections on perfect destination for a family on a weekend or indeed, even on aconstructions are about 2,000 lakh sq.ft (or less), leaving a gap weekday evening.of almost 4,000-5,000 lakh sq.ft. Investment of about US$10-

The air-conditioned comfort, music, gaming arcades,15 billion is needed to make up for this demand-supply gap,entertainment areas, food courts and all-under-one-roofand an additional investment of US$8-10 billion is needed inmerchandise ensure t hat every member of the shopping group isretail fit-outs and related equipment.indulged while the milling crowds obviate the need to converse.

However, this space is needed across more than 1,000 towns The malls embrace diversity and it that lies their biggest strength.and in major rural hubs rather than clustered around top 40-50 cities only. The developments have to be planned keeping However, it is precisely this diversity that makes the task oftargeted consumers and the targeted retailers and otherservice providers in mind rather than first build based onavailability of land and hiring an architect, and then find whocould use the space. Major hypermarket format retail playerswill probably work on the basis of taking up space in upcomingmalls as well as building own big boxes.

Despite this bright forecast for the future, there is a deep,lurking sense of foreboding when profit making in the retailspace is discussed in close circles. The huge initial investments

required in this field render break-even prospects bleak. It is aconstant batt le to consistently bring huge numbers of footfallsinto a retail outlet and an even greater challenge to maintain arespectable average transaction value.

Wooing the consumer in the face of more distractions andcompetition is becoming a priority for success.

While the number of new formats launched in the countrysretail landscape has been mind-boggling, the most visible faceof this surge in modern retail has been the spectacular rise inthe number of shopping malls across the country. According tointernal Technopak estimates, the number of malls in thecountry is expected to go up from 158 in 2005 to 600 in2010. Delhi is expected to lead among all the met ros in terms

IMPLICATIONS FOR THE CURRENT RETAIL REALESTATE SCENARIO

R1 6.0+ Within next 5years







Next 30-40 Retailers 6.0+ Within next 5yearsTotal 22+

Rapid Transformat ion Anticipat ed

RetailerEstimated

Investmentin US$ Billion

No. of Years

OntheGurgaon'MallMile'


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The security services in a mall are still way below internationalconsumer-delight so difficult given the number andstandards and do not address uniquely Indian issues such as twodistinctiveness of the consumer segments to focus on.adults monitoring two elders and three kids (!), women feeling

Every significant change in the demography of the country has unsafe in public spaces, huge class friction in many of the mallgrave implications for service and product management in the heartlands causing the mall consumers to fear even the mall staffmalls. I have outlined only a few of the most critical challenges and the mall security.for mall developers. Their response to these challenges will

A conundrum that strikes me every time I visit a mall is thedetermine their ability to successfully cash in on the Indiaexpectation and hope t hat mall shoppers will shop to t heir heartsBoom.content but the absence of any designated place to leave the

When one throws together an assortment of demographicnuggets, the cluster of necessities for a mall to accept is veryclear. Almost 55 percent of Indias GDP comes from theservice class, the time spent in work-related pursuits

(travelling to work and actual work hours) has grown sharply,the number of double income families has been on the risewhich has meant less together-time despite a higherdisposable income, steadily deteriorating infrastructure andenvironmental conditions and most importantly, a vigorouspursuit of youthfulness to stay relevant in these changingtimes.

Do malls mould their offering to match these newdemographic and psycho-graphic realities of India?

shopping bags. These shopping bags are carried along from onestore to another, deposited and collected from the baggagecounter at each store. Why should a consumer shop for more thanOne of the biggest challenges facing mall developers today isis necessary under these circumstances?the lack of infrastructural support for the millions of square

feet being developed as well as the millions spent in creatingUnlike the West, Indian shopping groups are big and sometimes as

the right look and feel for the malls. Given the unavailability of big as seven to eight members! Managing these large groupsland in prime areas, most malls dot the periphery of the city

inside the mall, providing each group with a decongestedlimits and require considerable effort to access. In an

experience is critical. Apart from the physical space provided toincreasingly time-starved world, malls need to ensure t hat

comfortably browse, malls also need to provide parking spaces forconsumer time is spent inside the mall, shopping, rather t han

people. These human parking lots will allow the crowd to thin outcommuting to and from the mall. Access to t he mall is still a

visually, aid easier navigation within the malls and allow the olderproblem with regards to parking no amount of parking space

members of the group recouping time so that they returnseems enough! Simplifying the access to the malls is likely to

refreshed to the shopping trip.pay rich dividends to mall owners by making the mall a more

My favourite example here is Inorbit mall in Mumbai. The mall hasfrequently accessed shopping place rather than a once-a-weekwell designed parking spaces positioned most thoughtfully atshopping destination. More than any other tenant the supervarious nooks and corners of the mall. The trick here though, is toand hypermarkets in the mall are likely to benefit from thisensure that these parking spaces are not right in front of thechanged perspective with which shoppers visit the mall.stores it takes away from the buzz or vibrancy of the store.

INFRASTRUCTURE

Unlike the West, Indian shoppinggroups are big and sometimes as big

as seven to eight members! Managingthese large groups inside the mall,providing each group with adecongested experience is critical.Apart from the physical space tocomfortably browse, malls also needto provide 'people' parking spaces.

C

ommercialStreet,Bangalore

FoodcourtattheInorbitMall,

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Ideally, these parking spaces are best positioned in of Indians travelling abroad is increasing by 25 percentnooks and corners or near elevators or escalators which each year; just last year, 83 lakh people travelled abroad)are natural decompression zones for consumers on and therefore access to premium brands is not an issue.shopping trips. Being made to feel special, having their privacy guarded

zealously is more important.

The money is there to be spent if the experience is part ofMalls today (with very few exceptions) have no the selling. Premium malls have a lot to learn aboutdefined positioning or reason to score over other malls. service from premium automobile or jewellery retailers orIt seems that developers put in the same concepts, the even the hospitality industry. A welcome drink, a cold orsame tenants, the same experience (or lack of it) with warm towel at st rategic points in the mall, quick pedicuresthe amount of space being the only differentiating or manicures/massages, valet t o park/retrieve the cars,variable between one mall and the other. For proof of more efficient shopping trolleys, trained and art iculatethis, one only has to go to the Gurgaon mall road. No sales staff (minus the Body Odour)the list can continueless than 10 malls will sit cheek to cheek on this road endlessly.but t here is absolutely no reason to visit one over the

Just as t he super premium malls are here to stay, so isother except the ones that have better movies playinganother concept based on changing psychographics ofor available parking at a certain t ime of the day.new India. The concept of the highway mall is

This lack of clear positioning has led to the malls appropriately being kick-started by the fountainhead ofbecoming melting pots or socio economic levellers malls Gurgaon. Other border areas such as Sonepat,resulting in the upper end of the consuming class Badarpur etc. are also seeing heightened activity in thisexperiencing a profound loss of their space. As the regard. The highway malls aim to capture two distinctmiddle classes throng to the malls, the upper classes target segments the frequent t raveller (who workstry to find new spaces to spend their time and money. across the border) looking to maximise time by accessingA long-felt need for an exclusive mall experience is a mall on the way home, and the long-distance, crossnow being realized as more and more mall developers country family travellers accessing the mall to rejuvenate,focus on the premium mall concept. Atria, the unwind, recoup.Millennium Mall in Worli, Mumbai is one such case in

My favourite example of a theme mall is a combination ofpoint. Several more malls are slated to target t his contexts a room crunch faced by frequent t ravellers inaudience in the key metros.

key metros and a tenant and conversion crunch faced byHowever what t hese malls need to do is to go beyond mall developers. The result hotel rooms in malls thatjust housing premium pr luxury brands and focus on satiate the huge demand for hotel rooms in India, both bythe premium experience. Most of the affluent class domestic as well as International travellers. The additionaltoday t ravel abroad on work or pleasure (the number facility in t he mall is not as much of a burden for the

POSITIONING FOR SIGNIFICANT NICHES

Haldirams,

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be most prevalent in these towns and a replicatedmodel will only pique curiosity but fail to translateinto desired revenues.

Developers will have to start understanding theculture of shopping in these towns as well as therelationship consumers share with existing trade inthese places. In our experience there is a high degreeof variance in shopping group size, composition andexpectations. For example, there is an extremelyhigh degree of participation in shopping from theolder segment in Gujarat, consumers in Bhopal arelikely to visit their traditional outlets for apparel but

visit a mall for entertainment and leisure. Consumersin Tamil Nadu and AP are likely to spend much moreon the movie experience while consumers in Delhiare likely to spend on the eat ing out experience.

Malls that are cognizant of these peculiarities aredeveloper as there is no need to acquire fresh landlikely to allocate space more efficiently to t enantsfor these rooms. Ansal API and Ambience Hospitalityand have a better offering to give the consumers ofManagement are creating about 100 rooms each atthat region.two of t heir malls coming up in Greater Noida and

Gurgaon.

In keeping with the de-ageing of the country,Malls will either intentionally or otherwise have anaffiliated needs such as health, looking good andemphatic impact on the landscape. They are boundentertainment are becoming prime motivators forto upset t raffic patterns, road carrying capacity,shopping. Therefore, concepts t hat target theseparking spaces in surrounding roads or residentialneeds exclusively are also likely to do very well.areas and most importantly, since malls are typically

Gaming malls, health malls, beauty malls, jewellery planned on the out skirts of the city limits, there ismalls, sports and fitness malls will mushroom overalso a displacement of the local ethos. Take forthe Indian retail landscape and also have theirexample, Gurgaon what was once a village with andedicated clientele. But unless these malls find a wayassortment of occupations saw a mall spring upto make visits to the mall regular rather thanwhich then gave rise to a plethora of high-riseoccasional, the money to be made here is likely to bebuildings and opulent complexes. Imagine theslim. These malls should focus on selling a mix ofimbalance caused by a village and a sprawling new-products and services rather than focus exclusivelyage township existing side-by-side!on products. Services are consumed, experienced and

forgotten making them perfect to build habit and It is important that developers give something backrepeat visits. to the community they so easily become a part of --

whether in terms of employment opportunities orinfrastructural development or a partnership in ideas.

With the keen interest in tier-II and III towns for mall All said and done, if the estimate of 600 malls bydevelopment, mall developers also need to start 2010 is even remotely true, the novelty value alonethinking beyond replicating the International models will no longer suffice to target t he new demographicin theme. Local tastes and preferences are likely to Indian entity. Tenants too would be loathe to invest

in a mall that is just the same as the one down theroad! Developers will not only have to think aboutreal estate, restrictive regulations and retail teet hingproblems but also have to build and differentiatetheir offering credibly and visibly from other malls tosurvive in the long run.

This is the time to start building the knowledgeadvantage required to build these distinctly andinnovatively positioned malls. India is rapidlychanging is mall thinking keeping pace?!

COMMUNITY FOSTERING

LOCALISED MALLS

Ladies day out at the Oxford Cha Bar, Kolkata

Shoppersa

tMG

Road,

Bangalore


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Consumption Trend for Shopping Center Development