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SYNOPSIS
I hereby declare that this report on mall survey at Orion Mall is submitted as the
requirement for III Semester MBA+PGPM Degree examinations 2018 through
Ramaiah Institute of Management Studies is my original work and not submitted to
any other university. This work has been done under the supervision of Ms. ROHINI
MADAM in Ramaiah Institute of Management Studies, Bangalore.
I would like this opportunity to extend my gratitude to all those who have extended
their support it wouldn’t be possible to conduct this study.
I extend my gratitude to Dr. Radha Ravishankar, DEAN of RIMS (Ramaiah Institute
of Management Studies) for their esteem support of issuing recommendation letter to
access.
I own a special debt of gratitude Rohini Madam of RIMS College for his valuable
guidance at every step of preparing this project. I am thankful for his timely advice
and inspiration for the accomplishment of this project.
Last but not the least I wish to avail myself of this opportunity, express a sense of
gratitude and love to my beloved parents for their support, strength, and help and for
everything.
BENSONVARGHESE
[MBA]
ABSTRACT
The shopping landscape is filled with malls, each competing for their share of the
consumer’s wallet. A significant method of trying to differentiate the mall product
and increase market share has been an attempt by mall developers and management
to increase the entertainment component of the mall. The current research was
designed to examine the relationship between the multiple ways that malls may create
entertainment value for the consumer and certain shopping behaviours.
The findings of the research clearly identified a relationship between certain specific
entertainment values in a shopping mall environment and shoppers’ mall visits but
not all entertainment values are directly associated.
The idea of adding a major entertainment center to a shopping mall has been gaining
in popularity over the past few years. Several new malls have been constructed in
different regions of the country, with substantial square footage allocated to
entertainment centers. Typically, these large scale entertainment centers feature
attractions such as: carousels, Ferris wheels, trains, bumper cars and other children's
rides, skill games, bowling alleys, miniature golf courses, roller or ice skating rinks,
and video arcades. The generally accepted notion is that such family entertainment
centers can substantially extend a mall’s draw, lengthen shopper stays, and increase
revenues of tenants. However, there has been very little research done across different
malls that lends support to this argument. This study examined the effects of such
entertainment centers on shopping behavior. Characteristics and shopping pat- terns
or shoppers drawn to a mall primarily because of the entertainment center were
compared to those of all other shoppers. Data were collected room 25 respondents
from a mall. The survey instrument was a structured personal interview
questionnaire.
Results revealed that a fairly low percentage of shoppers were drawn to malls
primarily by an entertainment centre. Such entertainment oriented shoppers tended to
be younger, and more likely to be visiting as a family unit compared to all other
shoppers. A significantly lower percentage of this group visited department stores or
other mall shops; although if they did visit either of these kinds of stores, they tended
to spend as much money as the other shoppers. They also spent comparatively less
time shopping, although the total amount of time spent at the mall was higher,
because of the time spent at the entertainment centre. There was, however, no
significant difference in terms of the distance travelled to the mall between the two
groups. Implications for owner/developers are also discussed
INTRODUCTION
The idea of ‘malls’ emerged since the early 1990s after appearing in Western
countries by more than 30 years. Shopping malls provide many options, including
entertainment and other social activities such as restaurants and cinemas. Mall is
recognizing more and more the positive impact of the environment on shopping
behaviour. Mall is generally used to refer to a large Shopping area usually composed
of a single building, which contains multiple shops. Usually one or more department
stores surrounded by a parking lot anchor a mall. Therefore, mall can refer to a place
where a collection of shops all adjoins a pedestrian area that allows shoppers to walk
without interference from vehicle traffic. A mall is a group of retail and other
commercial establishments that is planned, developed, owned and managed as a
single property, typically with on-site parking provided. Malls originally served as
catalysts in the growth of suburbs. Mall is flows of retail companies are the turnover
of commodities. The term, Mall can mean market for all. A mall comprises of
Shopping complexes, food courts and retail outlets. Today malls are gaining
importance as the disposable incomes of consumers are increasing. Consumers visit
malls to pass time shop and to dine at the restaurants located in the malls. There is
development of rich in mall segment, which is catering to particular segment of
people, they are meant for specific types of products, which are called as specialty
malls. A shopping mall is typically, a shopping complex connected by walkways. It
provides shopping as well as entertainment options to the target consumers. It
generally, contains one anchor store, which consumes twenty five percent of its retail
space. In addition a mall contains specialty stores for clothes, accessories, home
needs, books, as well as food court, multiplexes and entertainment zones.
History of Malls in India
The concept of shopping malls first appeared in 1950s. The credit towards invention
of modern mall goes to Australian born architect and American immigrant Victor
Green. The first generation of malls was set up in North gate Mall, US in 1950. 44
Later as time passed, the malls were then shifted from the crowded commercial areas
to the residential suburbs. These malls were accessible only through automobiles and
therefore gradually became a famous destination for retailers across the world.
Crossroads, renamed and currently known as Sobo Central, is the first modern
shopping mall in India. Opened in September 1999 by Primal Holdings Ltd., a
subsidiary of a major pharmaceutical group, it is India's first mall management
company. The mall covers an area of 150,000 square feet (14,000 m²), spread over
four buildings in the heart of the city. In India, rapidly developing mall environment
is living investors, domestic and foreign to make a pitch for a portion of the great
Indian market. It‘s growing and every hungry consumers, their apparently installable
demand for all the good things in life from groceries to vegetables to fancy gadgets to
fancier cars. The malls have change the way people are shopping. Malls are teaching
shoppers how to appreciate the good things of life. There are phrases like comfort,
style, convenience and cool, which the shoppers and retailers in mall culture are
using. The consumers are happy due to mall culture, now they don‘t visit mall only to
purchase but shopping has become an entertainment and roaming in malls on
occasions and weekends.
Concept of Malls
The concept of Retail as entertainment came to India with the advent of malls. Mall
fever has touched every facet of Indian society. Whatever is the income stratum of
consumers, malls make no distinction in proffering most-revered national and global
brands Shopping Mall refers to a set of homogenous and heterogeneous shops
adjoining a pedestrian, or an exclusive pedestrian street, that make it easy going for
shopper to walk from store to store without interference from vehicular traffic. Malls
are incorporated with a whole bank of lifts and escalators for smooth transit of
shoppers. Malls are located in proximity to urban outskirts, and ranges from 60,000
sq ft to 70,000 sq ft and above. The future of organized retailing is largely in the
hands of mall where the shoppers get quality, quantity, inspirational appeal,
recreation facilities and ambience. Under one roof, the flashy malls promises just
about everything under the sun, from foreign gizmos to the very desi, virtually an
airbus full of national and international brands, to say the least. Malls offer a plethora
of attractions- high profile shopping, impulse eating establishment, a glitzy and
glamorous environment to discerning shoppers of more refined tastes, who are more
concerned with quality and fashion and less concerned with budgets. Mall 45 reveals
six factors namely comfort diversity, luxury, mall essence, entertainment, and
convenience, which are a source of cynosure. In India, malls have transformed
shopping from a need driven activity to a leisure time entertainment. The quality mall
space, which was just one million square feet in 2002, has accomplished new
milestones of 40 million square feet and 60 million square feet in 2007 and 2008
respectively. There is a paradigm shift in the mall scenario, from just 3 malls in the
year 2000; the country witnessed 220 malls in the year 2006. Exhibiting signs of
further enlargement India is likely to have more than 600 in 2010 and 715 malls in
2015, with an estimated cumulative retail space of 100 million sq. ft. Shopping malls
in India are reckoned to worth Rs.38,447 crore by the year ending 2010. Real estate
corporations like DLF and Unitech are coming forth with the plans catering the ever
escalating demand of shopping malls. In the next four to five years Rs 65,000 is
budgeted to be invested in retail real estate development. In most of traditional Indian
malls, around 30 percent of space is allocated to apparel retailers while 12-20 percent
space is dedicated to Food and Beverages. Indian malls vary between 35,000 sq ft
to10, 00,000 sq. ft. while U.S. version is between 4, 00,000 sq ft to one million sq ft.
The largest malls in Indian metropolitan cities enjoy 25,000 footfalls per day which
hikes to an average of 40,000 on weekends. Due to radical revival of shopping and
consumerism shopping mall syndrome has hit India in all earnest. Even though the
malls are mushrooming from metros and mini metros to tier III cities, the spread of
malls is highly concentrated in India. North Zone is having the peak attractiveness
with 39 percent while South, East, and West Zone respectively holds 18 percent, 10
percent, 33 percent of total malls. Creating artificial product scarcity, cheap imitation,
and taking customer for granted are the talks of yesteryears, thanks to the mall
culture. Further, shopping mall is the paradise where various shopping motives like
peer group association, impulse shopping, hedonic, status consciousness, market
mavens, economic motive, utilitarian motive etc. can be fulfilled in one shot.
Types of Malls
The malls basically are classified on the basis of their Merchandise orientation means
types or Goods and Services sold and their size. The trend towards differentiation and
48 .The challenge of this of mall is to overcome the natural tendency of shoppers to
move horizontally and encourage shoppers to move upwards and downwards. (v)
Lifestyle Centre: Lifestyle Centre is new designated that has a loose definition.
Generally, it‘s a centre that does not have on anchor tenant in the classic sense that is,
department store. Lifestyle centre have a cinema as a major tenant. (vi) Dead Malls:
The dead malls are those, which have failed to attract new business and often set
unused for many years until restored or demolished. Interesting example of
architecture and urban design, these structures often attract people who explore and
photograph them. This phenomenon of dead and dying malls is examined in detail by
the website Deadmills.com which hosts many such photographs as well as historical
accounts. (vii) Strip Mall: Strip mall also called Shopping Plaza or Mini mall. It is an
open area shopping centre where the stores are arranged in a row with a sidewalk in
front. Strip malls are typically developed as a unit and have large parking lots in
front. They face major traffic arterials and tend to be self-contained with few
pedestrian connections to surrounding neighbour hoods. (viii) Outlet Mall: Outlet
Mall is a type of Shopping Mall in which manufacturers sell their products directly to
the public through their own branded stores. Clothing, sporting goods, electrical
products, cosmetics and toys are among the types of items sold at outlet malls. Outlet
malls first appeared in the United States as a development of the traditional factory
outlet a store attached to a factory or warehouse. An outlet mall places several such
outlets under one roof in a convenient location, usually an out of town site. The out of
town site minimizes overhead costs. (ix) Luxury Malls: Luxury Mall is mall, which
only house luxury brands. The mall in India luxury malls have been planned to be
built soon, most of the tenants are expected to be the best brands in the world such as
France‘s Louis Witton, Greece Dunhill Fendi Mont Benc, Van Clef and Arpels Rolex
and Omega.
DATA COLLECTION
The next step was to develop a sample for the survey. The researchers had previously
purchased a commercially available computer program which listed malls and their
mall management across the country. Thirty malls which were in excess of 500,000
square feet of gross leasable area were randomly selected to be the stimulus mall for
the consumers answering the surveys. Malls of this size are typically classified as
regional or super-regional malls and are the ones most likely to have the ability and
resources to make themselves more entertaining (Berman and Evans 2001). Once the
malls were selected, a sample of one hundred households within a fifteen-mile radius
of the location of each mall was purchased from a commercial research service. This
provided a total of 3,000 households for the sample.
Each household was mailed a survey, a cover letter, and a postcard. The letter asked
for the respondent to complete the survey and provided information about an
incentive that was being given for their cooperation. The respondent was asked to fill
out the survey and the postcard and mail both of them back to the researcher. The
postcard entered the respondent in a drawing for two prizes of $50 each and because
the survey came back under a separate cover it assured anonymity of the respondent.
Of the 3,000 surveys mailed, only twenty-two came back for bad addresses. A total of
485 completed surveys were returned for a response rate of 16.3%. The individual
response rate by mall varied from 4% to 25%.
DATA ANALYSIS
The sample was 14 females, 11 males, which is not surprising given that the survey
was done amongst women who came in groups as females still tend to do the
majority of shopping of all types for the family. The age of the respondents was split
about evenly between 20-25, 25-30 and 30-40. About half of the respondents reported
a family income of under 450, 000 and half were over this amount. The number of
visit to the Orion mall within the last thirty days ranged from 0 to 20, with a mean of
3.6 visits. The number of items purchased at the Orion mall during the last trip ranged
under 3. Mostly people came there to spend quality time with their friends and not for
shopping.
ENTERTAINMENT TYPOLOGY
As the literature review indicates, there has been no published research on the exact
extent to which the existence of a Family Entertainment Center (FEC) impacts the
shopping behaviour of customers in terms of draw, expansion of the trading area,
time spent shopping, money spent at other in-line retail stores (cross-shopping), etc.
The present study proposes to examine these issues by posing the following
questions:
Does an FEC draw additional shoppers to a mall?
Are the demographic characteristics of the shoppers drawn to a mall primarily
by a FEC different than the demographic characteristics of the shoppers drawn
to a mall primarily for shopping or the food/court restaurants?
Are shoppers drawn to a mall primarily by an FEC more likely to come to the
mall as part of a “family unit” (vs. coming as an individual or group of
individuals) as compared to shoppers drawn to a mall primarily to shop or visit
the food court/restaurants?
What percentage of the shoppers drawn to a mall primarily by a FEC also
cross-shop in the mall department stores and shops?
What percentage of shoppers are both drawn to a mall primarily by a FEC rind
cross—shop in at least one department store or mall shop?
Do shoppers drawn to a mall primarily by an FEC visit as many mall
department stores and shops per trip to the mall as shoppers drawn to a mall
primarily for shopping?
Do shoppers drawn to a mall primarily by an FEC spend as many dollars in the
mall department stores and shops per trip to the mall as shoppers drawn to a
mall primarily for shopping?
Do shoppers drawn to a mall primarily by an FEC spend as much time
shopping in the mall department stores and shops per trip to the mall as
shoppers drawn to a mall primarily for shopping?
What effect does an FEC have on the shopping patterns (store visits, money
spent, time spent) of shoppers drawn to a mall primarily for shopping? This
question focuses on the fact that the group of shoppers drawn to a mall primary
for slopping is actually composed of two subgroup those that shop and do visit
the FEC and those that shop and do not visit the FEC.
Are shoppers drawn to a mall primarily by an FEC more likely to visit the mall
food court than shoppers drawn to a mall primarily for shopping?
Does an FEC extend a mall’s trading area
METHODOLOGY
The objective of this study was to investigate empirically the above questions and
related issues. The study focused on FECs located in the common areas of regional
malls of at least 700,000 square feet. A common area FEC was operationally defined
as a concentrated, centra1ized, entertainment area of at least 30,000 square feet,
containing a variety of entertainment opportunities carousels, kiddie rides and trains,
video games, soft play structures, simulator rides, etc.
Eight regional malls with a common area FEC that meet the above criteria were
identified. Research funding limited the study to one mall. Therefore, representative
mall was selected in Bengaluru.
The survey instrument was a structured personal interview questionnaire administered
by trained market research field service personnel. Data were collected from 25
respondents from Orion Mall.
The data were analyzed for each mall individually as well as for all malls as a group.
Descriptive statistics, the “t”-test, and chi square analysis were used where appropriate
at the .05 level of significance.
RESEARCH RESULTS
Research findings are discussed below on a question by question basis. The words
“shopper” and “respondent” are used interchangeably.
Although the selection by a respondent of the FEC as the primary reason for coming to
the mall does not necessary menu that the respondent would not have come to the mall had
the FEC not been present, we can conclude that in general, an FEC, on its own,
appears to account for about 7% -10% of a mall’s draw.
The nature of these customers, their shopping and spending patterns, and the
implications of these findings are examined below.
Question 2: Are the demographic characteristics (age and income) of the shoppers
drawn to n mall primarily by an FEC different than the demographic characteristics
of the shoppers drawn to a mall primarily or shopping or the food court restaurants?
The average age of the respondents who indicated that their primary purpose for
coming to the mall was the FEC was 28 years, while the average age of all the other
respondents was 40 years.
The average annual income of the respondents who indicated that their primary
reason for coming to the mall was the FEC was 420,000 while the average income of
all other respondents (primary reason the opportunity to shop or visit the food
court/restaurants) was 450,000. This difference in mean income of 20,000 was not
significant at the t Test.
A chi square analysis of the income distributions of these two groups for all the malls
combined, and on a mall by mall basis, also found no significant differences in
income between the groups (FEC vs. shopping).
In general, the average income of respondents drawn to a mall by an FEC was not
significantly different from the average income of those drawn to a mall by the
opportunity to shop or visit the food court/restaurants. Marginal differences, or the
slightly higher average in- come levels of the respondents drawn to the mall primarily
to shop or visit the food court/restaurants, could be attributed to the significantly
higher average age (eight plus years) of these respondents. They are older, further
along in their careers, and consequently making more money.
Question 3: Are shopper drawn to a mall primarily by an FEC more likely to come
to the mall as part of a “family unit” (vs. coming as rim individual or group of
individuals) as compared to shoppers drawn to a mall primarily to shop?
A family was defined in this study as a respondent who was part of a group
consisting of at least one parent and one child. In brief, an adult “with kids” denotes
this category. An individual was defined as either a lone respondent or a respondent
who was part of a group of unrelated individuals (i.e., group of friends, teenagers or
classmates).
Approximately 17 or the respondents who indicated that their primary purpose in
coming to the mall was the FEC came to the mall as part of a family. Only about 24%
O* the respondents Who indicated that their primary purpose of coming to the mall
was shopping or visiting the food court/restaurants came to the mall as part of a
family i.e., 76+% of the primary purpose “shoppers” were without kids and the rest
came with kids
Question 6: Do shoppers drawn to a mall primarily by on FEC (and who also shop)
visit us many mall department stores and shops per trip to the mall as shoppers drawn
to a mall primarily for shopping?
The average number of department stores visited by respondents drawn to a mall
primarily because of the FEC (who also shop) was 1.4, and the average number of
mall shops visited was 1.8. In comparison, the average number of department stores
visited by shoppers drawn to the mall primarily for shopping.
It appears that respondents who are drawn to a mall primarily by the FEC, and who
also spend time shopping, visit as many department stores and mall shops as do
respondents drawn to a mall for shopping.
Question 9: What effect does an FEC have on the shopping patterns (number of
stores visited, money spent, time spent) of the shoppers drawn to a mall primarily for
shopping?
Twenty Five respondents indicated that their primary purpose for coming to a mall
was the opportunity to shop. Of this group, 19% (5 respondents) further indicated
that, in addition to shopping, the FEC also was visited. The remaining 81% (20
respondents) indicated that only shopping occurred while at the mall-the FEC was not
visited.
In order to examine the above question, the two subgroups of respondents drawn to a
mall primarily for shopping-those who shop and do visit the FEC and those that shop
and do not visit the FEC, were further analysed. A comparison of these two groups
was done in terms of department stores and mall shops visited, expenditures at these
stores, and the amount of time spent.
Based on the analysis, it appears that respondents who visited the mall only to shop
(did not visit the entertainment centre) were more likely to visit at least one
department store and to spend more money than respondents who visited the
entertainment centre. Conversely, respondents who spent time and money at
department stores were less likely to visit the FEC. The entertainment centre,
therefore seems to have more of a synergistic relationship with the mall stores than
with the department stores.
Although shopping time was approximately the same for both subgroups of
respondents (about 100 minutes), the subgroup of respondents that shops and visits
the entertainment center spends about 50 minutes longer at the mall compared to the
other subgroup. This additional time is spent at the FEC.
10
12
20-25
25-30
30-40
20
no. of walk-ins
Morning
Afternoon
4 Evening
10
Figure 3 showing the average amount spend by the customers during shopping
walk-ins
20
week days
week ends
45
no. of people
25
12 <1500
1500-2000
2000-2500
2500-5000
35
CONCLUSION
The myth of the female shopper who wanted to nothing more than to go shopping for
a day as a means of entertaining herself has been replaced by the myth of the female
shopper who finds shopping a chore and wants to complete the task as quickly as
possible. Neither of these views is entirely correct or incorrect. Today’s shopper is
time pressured, but can still find enjoyment through the act of shopping. Mall
developers and managers have been working hard to try to make the shopping trip as
enjoyable as possible and provide our shopper with a reason to stay in the mall longer
and to come more often. Malls are largely trying to accomplish this goal through
making the shopping trip more entertaining, but they have been lacking in basic
research as to what creates an entertaining shopping trip.
The current research developed an instrument to tap into multiple dimensions of what
makes for an entertaining mall visit. Possibly the most important finding of the
research was that only two dimensions of mall entertainment appeared to be driving
the number of visits to the mall. One of these dimensions could be easily categorized
as having a hedonic experience while shopping. However, the other appears to
largely be a utilitarian dimension of the shopping trip. Since both of these dimensions
had a direct and significant relationship with the number of shopping visits, it is
important for mall developers and managers to remember that shopping is an
economic activity which provides the shopper with desired items. Making sure that
the mall has the right mix of stores to address the needs of the target market should
remain a prime consideration.
The current research also demonstrated that while entertaining the shopper is
important, it does not necessarily have to include large amusement areas, theme
parks, or strolling troubadours. Shoppers just wanted a place to get away from their
daily grind, a place to visit with friends and family. There are a number of ways that
malls help provide the means for consumers to engage in these activities, such as
staying open at night, having food courts where multiple types of food are available,
having special exhibits keyed to consumer interests and activities (e.g., boat shows,
camping shows, bridal shows), and having seating areas where people can rest and
visit. These features are not necessarily expensive to produce, but they provide great
value and incentive for the consumer to visit the mall.
While this research provides a clear cut of relationship between the entertainment
aspects in the shopping mall and shopping behavior, it suggests several additional
avenues for future research. For example, at present, it is unknown what portion of
influence to the shopping behaviors comes from the children in a family. Obviously,
a significant portion of household shopping behavior may be influenced by children.
The age and gender composition of the family’s children may also play a role. For
example, a family with two teen-aged girls may be encouraged to go shopping more
frequently than a family with a single male toddler at home. Further, the gender
difference in shopping behaviour is not discussed in the study. It is well known that
males are not generally shoppers, but identifying key entertainment aspects for males
may help mall managers develop programs encouraging greater participation in
shopping by males.
The mall has become the downtown for many suburban communities. As such, it is
expected to provide more than just necessary products for the consumers in the
community. It has become the preferred gathering place for teenagers, a place to meet
friends after work, a place for early morning physical conditioning, as well as a
convenient location for buying merchandise. The mall is a hub of both economic and
social activity (Feinberg, Meoli, and Sheffler 1989) and what encourages people to
engage in consumer activity in these locations is an important area for further
research.