Many experts and studies have been saying that all retail concepts and shopping centers will change soon, because new customers — members of Generation Z — are coming, with different values and different mindset. Shopping Centers Russia talked to malls developers and retailers about “Generation Z case”.
Offline wins, but technology comes at a price
Although even malls and retailers top-managers are confident that Gen Z are already choosing online now, the future buyers themselves say the opposite. The participants of global surveys vote for offline: the ability to touch, measure, compare physical goods is still valued above the speed of purchase. According to Accenture’s research, 60% of young buyers choose offline retail, while 28% appreciate the opportunity not only to visit a physical store, but to consult with the real seller.
According to a survey by MAGRAM Market Research, conducted in Russia in conjunction with the international communications agency PBN Hill+Knowlton Strategies, 66% of the “zets” chooses live communication with friends. Hence the request for events in shopping centers: Gen Z will appreciate any opportunity to get together with friends in order to somehow spend time and chat. And in some cities, even quite large ones, shopping centers remain the only available place for such offline communication.
At the same time, there is still a fairly high demand for technological support for shopping. Almost 70% of Accenture survey participants said that they would like to buy goods through social networks, rather than in an online store, and 38% would like to order goods by voice. Optimization of time is indeed one of the main values: 73% appreciated the services that send clothing by subscription, and 71% appreciated the automatic replenishment of stocks in the house.
Run at 4G speed
The L’Etoile chain of stores suggests that typical representatives of the Generation Y (who now make up a significant share of customers) and Gen Z (who are still growing and making purchases with parents’ money, but will soon start earning themselves) are people who live at 4G speed. “Most of their time they spend on the phone, they need fast and high-quality solutions. For those who do not want to spend a lot of time on purchases, we develop an online store, our own application and communities in social networks”.
Many retailers make their own applications in order to add interactivity and personalized features to offline shopping. Suffice it to recall, for example, a chat bot and an app from VkusVill, where you can get individual discounts using the “I’m in the store” function, or set a “favorite product”. In addition, there is now an opportunity to choose the desired level of interaction with the cashiers: having scanned the card, they will see if the buyer wants them to talk to him, offer him to buy goods for a promotion or choose a favorite product right at the checkout, not in the app.
The application of the Perekrestok chain of stores allows you to make a shopping list in advance, select goods with discounts on various filters, and save your purchase history. Users have access to personal offers, free coupons, virtual stickers and a catalog of privileges. Of course, the virtual club card in the application is also sewn. There is also a separate Self Scan service, which for now operates in just a few supermarkets: customers can scan product bar codes using the application and pay for them without a cashier.
At the same time, retailers understand that physical stores have not lost their relevance. They just turned from shopping places into spaces for relaxation and for receiving emotions. Fewer shops, more entertainment — such requirements are put by the generations Y and Z. This requirement is taken into account, for example, in the L’Etoile store of the new format in the Afimall shopping center in Moscow: there are wide aisles, plenty of light, thematic design of shopping areas, barbershop, beautiful areas in which you want to take a selfie. The entire design is thought out in such a way as to inspire the store guests to new stories. The head of the marketing department at Ingka Centers in Russia, Irina Tskhadaya, notes that for Generation Z personalization, quality and practicality are especially important. “They have a more mundane and pragmatic view of life compared to millennials and a high need for personalization. This generation values brands not as a status, but as a guarantee of quality and uniqueness”. Generation Z also supports the trend for a healthy and green lifestyle, closeness to nature.
SHOPPING CENTERS RUSSIA | APRIL 2019 | 81