Shopping Centre Benchmark Indicator 2004

By Dr Dirk A Prinsloo

Urban Studies

During 2000 Urban Studies published the first shopping centre benchmark indicators for small convenience, neighbourhood centres, right through to major regional shopping centres and super regional centres. These benchmark figures are based on a large number of interviews conducted at different size centres throughout the country between 1998 and May 2004. For the purpose of graphical representation centres of similar type and size have been grouped together in order to facilitate comparisons. In total the results of more than 100 shopping centres have been included in this tracking survey. These trends give an insight into the macro shopping centre performance during a particular year.

Frequency of visiting shopping centres – % weekly support

The weekly support for shopping centres smaller than 10 000m² has remained very constant since 2001. These centres have a much smaller catchment area (mainly 2-2,5 km radius) and 75% of their regular customers support the centre on a weekly basis. This clearly indicates the convenience nature of these types of centres. The 25% not supporting the centre on at least a weekly basis could be workers living closer to other convenience centres and households supporting more than one particular convenience centre. The most notable trend for all other centres for the period 2002 to 2004 reflects a slight decrease in support levels during 2003, while most of the centres have picked up for 2004.

On average 66% of the visitors to regional shopping centres (60 000-100 000m²) support a particular regional centre on a weekly basis. The most notable aspect with regards to the super-regional centres is the increase in support from 47% weekly support in 2002 to 58% in 2004. This indicates that the new super-regional shopping centres have established themselves more and more in the market place and higher support levels are occurring. It has taken longer for the new super-regional centres to establish themselves compared to small centres growing into regional centres. It is unlikely that the weekly support of super-regional centres will be higher than 60% visits per week. The main reason for this is the large catchment areas and the support from the secondary and tertiary trade areas is mainly for nightly or monthly.

 

Increasing competition in certain areas will also impact on the weekly and monthly performance of centres such as Cresta, Westgate and Northgate (mainly because of the opening of Clearwater Shopping Centre), Tyger Valley (opening of Capegate) and Menlyn Park Shopping Centre because of the opening of Woodhill Boulevard. The challenge for these centres would be to retain their loyal support base, the number of visits per month and most importantly spending per month.

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The visits per month for shopping centres of similar size

The number of visits per month for shopping centre type has remained very constant, with the figure for the smaller centres (

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Loyalty factor

Loyalty to a particular centre can be measured by the number of visits relative to the last 10 visits to similar size centres. The loyalty factor for smaller centres is 5,3 indicating a strong competition from centres of similar size. In most suburban areas there are a variety of Spar stores, Pick ‘n Pay and Woolworths Food stores, in many cases in three different centres. This results is lower loyalty levels. Community type centres (between 10 000 and 30 000m²) also have a lower loyalty figure mainly because some of these centres are old and in desperate need of an upgrade and revamp.

Many of these community centres compete with strong regional centres on the one side and on the other side with convenience/neighbourhood centres.

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Average time spent in centre

The time spent at shopping centres smaller than 10 000m² has remained very constant during the last 6 years at ±40-43 minutes per visit. The average dwell time for centres between 10 000m² and 30 000m² is 70 minutes, between 30 000m² and 60 000m² is 97 minutes, and between 60 000m² and 100 000m² is just over 2 hours. The average dwelling time in the super-regional centres is ±170 minutes because of the wide variety of stores, the long walking distance, the provision of a large number of food courts, coffee shops, restaurants and entertainment, all having an impact on the dwell time in the super-regional centres.

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Shops visited during shopping trip

The purchase to visit ratio (the number of shops visited divided by the number of shops bought at) is lower for the super-regional centres. These centres offer a wide variety of comparative shopping and browsing. Therefore window displays, pricing, service levels and merchandise quality will be of utmost importance.

The purchase ratio could vary from as low as 30% to as high as 80-90% (or even 100% for most convenience centres).

Driving time to centres

The average driving time to most type centres has remained very constant since 1999. The outstanding difference is the driving time to super-regional centres where the average driving time has increased from 23 minutes to 31 minutes. This clearly indicates a much larger catchment area as well as a regional role played by the super-regional centres.

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 Value centres

During the last 3 years Urban Studies has conducted a number of surveys at so-called value centres. The benchmark figures for value centres are different to what is discussed above. The following is a brief comparison with the above-mentioned findings.

The frequency of visits per week indicated that 47% of the customers visit value centres on a weekly basis. This weekly support is strongly influenced by the presence of a strong food anchor as part of the value centre. In a number of value centres a large supermarket acts as the main drawcard. The weekly support for value centres is much lower than the 70% – 75% weekly support for other centres.

The loyalty factor of these centres is also much lower than that of similar size community/ regional centres with a 4,4 loyalty factor compared to between 6 and 7 visits out of the last visits for ordinary type shopping centres. This clearly indicates the level of competition, but more importantly the fact that most trips to these centres are destination driven and not supported on a very frequent basis. The average dwell time at a value centre is 66 minutes, which highlights the destination type trip.

The average driving time to a value centre is 17 minutes, which is in line with centres of between 30 000m² and 60 000m². This also indicates that the trade area of a value centre is smaller than that of a regional centre in close proximity.

The value centre in most cases is a function of the tenant mix, the neighbouring regional centre, the presence of large food anchors and a destination-orientated trip.

Most important trends during the past year

The new super-regional centres have established themselves in the market place and the duration of this was much longer than for smaller regional centres. Customers are prepared to travel further to the super-regional centres and with longer dwell times. All this is a function of convenience, a variety of stores and knowledge of the centre. Research conducted at some of the super-regional centres indicated that shoppers complained about long walking distances and the fact that they get lost in the centre and they feel unsure about where to go in these large centres. To address these problems information centres (see photograph) in our super-regional malls could be improved. These information centres must become service-orientated and not only information kiosks. In most of the American shopping centres, especially those built after 2000, seating is provided to create rest areas in a very attractive setting.

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The challenge for the large super-regional malls is to make it as easy as possible for their shoppers to spend a 3-hour (or longer) period in the centre.

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Shopping can also become very tiring!

info-kiosk

An Information Centre must be more than just a kiosk/info desk. All South African centres could improve on this component.

These photographs illustrate very simple aspects that could be used to impact on the benchmark figures of a centre. We tend to focus on the major, expensive issues while the smaller aspects in shopping centre management are sometimes neglected. The theme of this year’s Congress – “It’s all about You!” – must culminate in total customer satisfaction.

 YOUR PARTNER IN MARKET RESEARCH