Shopping malls continue to grapple with the problem of declining store performance and the loss of well-known brands. In the past year, many retailers have shuttered brick-and-mortar storefronts and moved their operations online. Concerned mall facility owners are turning to new technologies, designed to help revive shopper interest and keep complexes in the black. However, as is so often the case, the promised gains of the new technology come with a host of negatives that make real-world applications problematic. In particular, shopping malls must carefully weight their growing need against the potential backlash that might result when if shoppers sense that their movements are being tracked and manipulated. But if used correctly, such technological advancements may be just what is needed to help revive the industry and keep shopping malls going strong.

Most of the new technology designed for mall facility owners focuses on customer tracking through smartphone monitoring. Using this technology, users can track a shopper’s specific behavior, as well as the overall traffic patterns that emerge as crowds move among stores. Information about the amount of time that a device stays in one store or a complete history of the customer’s shopping destinations during each encounter also can be saved. These data then can help landlords better determine where to place retailers within the mall for shopper convenience or plan facility layouts designed to bring shoppers further into the complex, where they have an opportunity to interact with more stores. One new mobile application called StepsAway even allows retailers to push discounts and promotions automatically to shoppers’ cellphones, without any need for the mobile users to install an application first. Such promotions might effectively encourage users to visit a new store or stop by a favorite destination as soon as the user enters the mall.

The degree to which customers will be comfortable with such tracking software will vary; however, among Millennials, more than 50 percent confirmed that tracking via Wi-Fi and mobile devices is tolerable, according to a 2015 survey conducted by MaxMedia. Mall owners also will need to consider how the data are used and stored, taking particular precautions to keep these data out of the hands of potential hackers. Such data breeches often result in long-term public relation consequences, which can easily overturn any customer gains attained from the use of the technology.

Discussion Questions: 

1. How are mall owners using customer tracking?
2. How do you feel about having your location tracked when you’re in a mall?

Source: Matthew Stern, Retail Wire, March 23, 2017