Are malls dead or just the kind that we have known, geographically distant and not “smart”? In Liat Clark’s Wired UK piece, an industry insider pushes back at the idea that shopping centers will no longer be central.
In five years time, the word ecommerce will no longer mean what we think it does today. According to J. Skyler Fernandes from Simon Venture Group ecommerce will not be understood as a separate business to offline retail — instead, the line between the two will continue to blur and morph, but the focus will always remain on physical shopping.
“I’m going to break one cliche now,” said Fernandes, who heads up the future of retail investment arm of America’s largest mall owner, Simon. “‘The mall is dead.’ That is not going to happen. The mall is alive. It is at the centre of community, it is the future of conversions and will play an increasingly important role online and off.”
Speaking at WIRED Retail, Fernandes revealed some staggering figures that show ecommerce is not only no longer in its infancy, it is nowhere near as vital to the retail industry as physical, in-store sales.
Ecommerce conversion rates are a paltry three percent, versus the 20-30 percent conversions of walk-ins to physical stores; basket sizes are 1.5-3 times bigger in-store; ecommerce is worth $304 billion, but traditional retail is worth $4.4 trillion.•
