Physical retail has had its share of problems recently, and consumers are finding it increasingly easy to shop digital and save themselves the trip. The resultant fall in foot traffic has pushed retail bankruptcies up 30 percent year over year, as Gymboree, RadioShack, Payless ShoeSource, Gordmans, Wet Seal, The Limited and (as of today) Toys “R” Us have all slid into bankruptcy. Even the staple players that are holding on — Sears, Macy’s, JCPenney, J.Crew and Gap, Inc. — have all scaled back.
In short, mall brick-and-mortar stores are closing and taking malls down with them. Among one of the internet’s weirder fascinations is a trend of photographing the various ghost malls that increasingly dot the retail landscape.
For Simon Property Group, the real estate investment trust that is the world’s largest owner of shopping malls and the owner and operator of 208 malls, this new direction in brick-and-mortar retail is not good news. Although in some sense the transition to eCommerce — and away from physical commerce — has been the root of the problem, Simon Property Group is hoping to find a solution in the new capabilities online retail can unlock.
Like, say, the concierge that consumers carry in their pockets, even if they don’t know it.
The Physical Retail Magic of Chatbots
Chatbots were rolled out with a lot of bells and whistles. But they quickly struggled with consumers, because, in many cases, they seemed to offer, at best, a more labor-intensive version of digital interactions that were actually more easily done through apps or web interfaces. There was a lot of talk about what chatbots could do in the future, but the early days of AI made most of those capabilities more hypothetical than actual.
The physical world of commerce might just have within it the killer use case that the chatbot needs, because it digitizes a physical experience for a consumer in a way that actually adds to the overall experience.
“We identified an opportunity to enhance our customer service by tapping into the Facebook Messenger platform and providing its user base with a fast and convenient way to access relevant, useful information about their favorite Simon center,” Patrick Flanagan, vice president of Digital Marketing and Strategy at Simon Property Group, said of his firm’s recent launch of a Facebook chatbot app designed to better help customers orient themselves in Simon Property locations.
Their design includes the ability to answer consumer questions about stores hours, locations, special events and restaurants within the mall, which is all data consumers need, said Flanagan. Using a chatbot app will make the shopping experience more seamless, but it’s not the kind of app consumers necessarily want to put on their phones. Via Facebook Messenger, however, they don’t have to; by tapping into an app they are likely already using, consumers can obtain the information they need.
And, more importantly, the information is provided when customers actually need it — instead of being randomly pushed at them via notifications as they walk through the mall.
“The Simon Facebook Messenger bot provides an always-on, instantly available digital concierge experience. That means that wherever they are, shoppers can get their top questions answered through their mobile device.”
The more customers interact with the chatbot, the more the bot learns about what customers need and want when shopping. For example, a consumer from Westchester whose favorite department store is Neiman Marcus will see somewhat different content than a Colorado resident who spends most of her physical shopping time at REI.
The mobile app is also designed to allow Simon Property Group to mark consumers by location. Behavioral data on where consumers have shopped in the past help customize the types of offers and promotions they see, in what the company refers to as “a mix of customer care and proactive marketing.”
Will it be enough customer care to bring consumers back to the mall? That remains an open question, but this is one effort among many Simon is making to revitalize its brand in an era when customers are straying far, wide and digital.
Last May, Simon Property Group announced news of its plan to invest $1 billion to redevelop its properties for the digital age of retail, which comes on top of the $5 billion the company spent over the past five years on interior enhancements.
They’ve put in the work. The question now is, will the consumers come back?