With the second wave of the ongoing pandemic hitting hard, malls are still suffering from low footfall due to the restrictions. As per the Shopping Centres Association of India (SCAI), malls managed to achieve only 50-55% revenue in FY2021vis-a-vis FY2020, despite the festive season.
Also, lockdowns for two consecutive years have slowed the construction of malls in tier II and metro cities. Many launches planned have been postponed or delayed since last year due to a cash crunch, informed Mukesh Kumar, chairman, SCAI, and CEO, Infiniti Malls.
Mall owners are anticipating a better FY2022 as and when the vaccination drives increase in pace. Segments like athleisure casual wear, international luxury and F&B did well, with revenues reaching up to 80-90% of pre-Covid levels in 2020, shared Pushpa Bector, executive director, DLF Retail.
In FY21, from January to March, the malls saw a 70% overall footfall and witnessed a surge of up to 85-90% pre- Covid level revenues. Mall owners seemed better prepared this year with the launching of cloud kitchens and deliveries. DLF, for instance, plans to launch several new features like Lukout Closet with refreshed content and direct brand connections to fulfill purchase via the digital bridge of Lukout, informed Bector.
Select Citywalk has offered for personal shopping. Compared to last year, this year during the second wave lockdown they received 80-100 orders a month through video calls with personal shoppers, said Yogeshwar Sharma, CEO, and Executive Director. He expects athleisure, beauty segment, and casual fashion to rebound once the restrictions are eased.
Viviana Mall has enabled cashless payments at the food court and restaurants. It has collaborated with a few start-ups to create apps to enable paperless shopping and operations at the mall, informed Gurvineet Singh, CEO, who also keeps in touch with customers through loyalty programs in real-time.
With rents for retailers discounted by 50%; some are preferring to replace the fixed rental model with a business sharing model.
Future of malls
It is a question of safety and adequate measures taken by the malls.
India lacks a culture of strict compliance. Hence malls will need to put in severe protocols such as automatic infrared cameras with high-tech filtration systems, added Pinakiranjan Mishra, sector leader at EY.
Malls had launched several initiatives like click and collect, curb-side pick-ups to ensure safety last year. Rajat Wahi, partner, Deloitte India, said that retailers will have to transition to online mode because consumers will still shop virtually with shopping assistance. He said that the phygital (physical-digital) mode is evolving rapidly now.
All in all, the footfall is likely to remain low given the slow vaccination drive, physical malls will always find consumers if they offer compelling experiences. Malls are all about experience and that the future lies in the Premium Grade A malls which will become more exclusive and experiential. This will make it difficult for small malls to survive, stated Pushpa Bector.