As the rash of retail CVAs batters the bottom line of some of the UK’s biggest retail landlords, Retail Week looks at whether data can save the shopping centre.

Even the most cursory look at recent BRC-Springboard footfall figures since the turn of the year paints a bleak picture for retailers across the bricks-and-mortar spectrum. Footfall figures at shopping centres have been almost uniformly falling since the beginning of the year. As a result, retail property owners are feeling the pinch.

Earlier this month, in the space of a week, three of the biggest shopping centre owners in the UK published half-year updates. Hammerson, Intu and then Westfield all reported falls in rental income as a result of increased vacancies resulting from factors such as CVAs.

Meadowhall shopping centre Sheffield

British Land launched its data sharing app at Meadowhall in Sheffield

Intu was hit the hardest – net rental income across its 14 UK schemes plunged 17.9% to £205.2m. Group level income at Hammerson slipped 6.8%, while Unibail-Rodamco-Westfield’s UK income slid 3.1%.

In response, landlords are seeking to change their tenant mix, moving away from retail towards food and drink and leisure offerings, as well as mixed-use, shared working space and even residential developments to drive footfall.

To help inform such decisions, many landlords are turning to data capture to get a better picture of customer behaviour across their schemes. Different landlords have turned to various means of capturing data and some are finding it more difficult than others to get retail tenants to share their own unique sales and footfall data.

Retail property consultancy Pragma’s director Andrew McVicker says the sector has come to the realisation that using data “is not now just a nice to have, it’s absolutely fundamental”.

Bespoke data for your store

One landlord turning to data to optimise its tenant mix and improve relationships with retailers is British Land. On a recent visit to its flagship Meadowhall shopping centre outside Sheffield, retail director Mark Bruce was keen to show off its ‘BL Mallcomm’ app.

The app, launched at Meadowhall in August 2018, is used by British Land staff and tenant store managers to share data such as daily footfall reports, anonymous sales data and what Bruce calls “bespoke performance reports”, which benchmark stores by category against competitors in their segment.

Since the Meadowhall launch last year, the app has been rolled out to all of British Land’s schemes and Bruce says it plays a key role in driving leasing decisions.

Meadowhall Mallcomm app

The Mallcomm app

“For example, if we see that menswear sales have increased to 30% of total sales at a centre, but menswear shops only account for 20% of stores, it enables us to go to a particular retailer and tell them exactly why they need to be at a certain centre,” he says.

Bruce says 100% of the retailers at Meadowhall have signed up to Mallcomm, alongside 90% of retailers across British Land’s wider shopping centre portfolio.

“We have seen strong retailer demand for the app. It has almost 20,000 users,” he adds.

“We are finding that in addition to store managers, head offices are increasingly interested in seeing the data. They often say to us how unusual it is to receive the level of information that we provide.”

According to British Land, the app has had over 1.1 million views since launch and has strengthened bonds between tenants and the landlord on its schemes.

Customer-facing apps

Both Hammerson and Intu have also been working on apps designed to capture customer data onsite, though neither’s offering was created to offer data and transparency specifically for tenants in the way that British Land’s is.

Hammerson’s head of customer experience Kathryn Malloch explains that its app was “designed as a personal shopping companion” and gives customers “a range of benefits such as inspiration, rewards, and help to buy”.

Malloch says while data capture “is a really important part of optimising the app”, its main focus is to add value for consumers. When it comes to informing the tenant mix, she says Hammerson are “looking at a much bigger [customer relationship management] piece”.

“Using Wi-Fi connectivity is one example. It gives us a much bigger and wider data pool – basically any time someone logs into the free Wi-Fi at one of our sites. We’re also working with mobile providers to look at mobile data because having anonymised access to that would give us a broader picture of anyone with a smartphone in our centres, whether connected to Wi-Fi or not.”

She says Hammerson started trials with mobile data and Wi-Fi data in November 2018, and it is already starting to help form a “rich picture”.

“If 40% of my shoppers always visit three locations, for example, then you’ve got a better understanding of what the anchors are within a centre. It’s valuable information that we could potentially share with retailers,” she says.

When asked how readily retailers are willing to share footfall and sales data with Hammerson, she says “it’s mixed, if I’m honest” but the landlord does “do regular surveys in order to build good relationships with our tenants, so retailers can better understand our types of customer who come to our centres”.

Intu, meanwhile, is also looking at apps for data, but again views such technology mainly as a means of rewarding customer loyalty. Commercial and digital director Trevor Pereira says the app is first and foremost a tool to encourage “loyalty in physical purchases and repeat visits to the centres”.

The app evolved from an indoor navigation tool to one essentially offering customers cashback on purchases at participating retailers on Intu schemes. “The thought process was driven by how we better merge digital technology and capability with the physical environment to give customers tangible and ongoing rewards for their business,” says Pereira.

While the transactional app is still a pilot, Pereira says Intu has already gained valuable information from the 20 or so retailers that are participating at present.

“It’s helping us get to know our customers better, which means we can develop more relevant marketing propositions for them,” he says. “Those propositions hopefully mean that we gain their trust, which in turn means we gain more feedback. That enables us to better tailor our individual centres to the needs of that individual catchment.”

Pereira says that while Intu does share “category level data with retailers” and tenants, it is being used more to “demonstrate behavioural change” amongst customers.

Bringing retailers on board

Pragma’s McVicker is not surprised that some institutional landlords are struggling to get buy-in from tenants when it comes to data sharing. He maintains that some landlords only pay lip-service to the idea of collaboration – at least until market conditions mean that the “boot is on the other foot”.

“The problem from the occupier view at the moment is that landlords talk a lot about collaboration, but they don’t bring much to the party themselves in terms of shared knowledge,” he says.

He believes that many occupiers are still wary of sharing granular data about sales and footfall, for fear landlords will use that information to drive rents up at the next review.

“I think the suspicion from the occupier is that the landlord is trying to better understand their business to claim a higher share of sales to convert to rent.”

intu Pocket app

Intu’s customer-facing app

One way to address this, says McVicker, is for institutional landlords to look at a wider list of metrics for customer data across their schemes that they can then easily share with tenants.

“What landlords really need to do is be able to display things other than just footfall – they need to show the audience is engaged, be that awareness of the centre, awareness of the brands and the overall proposition, frequency of visits and dwell time.

“There are myriad ways to display engagement. What it can’t be is ’our footfall is this, therefore we’ve done our job’.”

While the number of data points for landlords to capture from customers – and which actually matter most – may seem daunting, McVicker is convinced that landlords not looking at such approaches will be left behind as the pace of change in the market continues to quicken.

“Landlords should be looking at getting tenants in that build a new audience, not just ones that benefit from an existing audience,” he says. “Those using Zone A frontages as their guiding philosophy are soon going to be out of the picture because the times are moving on.”

The message seems clear. Retail property owners who don’t want time to run out on them need to embrace the opportunities data can bring.