Enhance mall success with Capture Rates
A mall is only as good as its retailers which makes understanding their performance the crux of maximising success.
We know that measuring footfall into a mall is critical – this is the customer pool from which stores draw their trade – but for a mall to maximise sales, stores located within the mall need to capitalise on this and successfully attract customers through their doors.
The key here is not only to measure footfall into the mall and into its stores, but to compare one with the other. This is the Capture Rate and it delivers the insight on whether a store is maximising the sales potential of the mall. If you haven’t read out first Capture Rate blog “Capture Rate – what is it?” check it out.
The Capture Rate represents both the percentage of footfall that enters a mall from the street, and the percentage of footfall in the mall that enters a store.
Both are a measure of market share, and key indicators of mall performance. The Capture Rate for both malls and stores should be stable or increasing – a declining Capture Rate indicates trading challenges;
If the mall’s Capture Rate is declining it means footfall in the mall is falling behind footfall in the street
If a store’s Capture Rate is declining it means that the number of customers entering the store is falling behind footfall in the mall
So how can Capture Rates deliver the understanding needed by malls to drive up customers and therefore sales? There are four main ways:
- Analyse mall Capture Rate – the success of the mall in attracting footfall from the street
- Measure store performance – the success of individual stores in attracting shoppers
- Evaluate promotions and events – the ROI delivered by mall initiatives
- Attract new retailers into the mall – demonstrating that they will trade successfully
If you’re looking for the applications of Capture Rates for retailers, take a look at our blog on “Using Capture Rates to drive performance“.
Mall Capture Rate
This is the market share of the mall in the town or city. All this needs is a counter at the entrance looking out into the street – really easy to implement and incredibly valuable. It tracks footfall past the mall and, comparing this with footfall into the mall, means that the Capture Rate can be established and tracked for any time period.
It answers the key question of whether the mall is maximising the potential of the town, whether it is increasing its influence or whether its influence is declining. Equally, it provides valuable insights on the performance of the town/city in which the mall is situated, enabling the mall to consider how best to maximise growth opportunities and insulate itself from wider retail challenges felt by many high streets.
Are the stores within your mall achieving their full sales potential?
Identifying the Capture Rate of individual stores gives you vital insights into their performance, and how they are faring relative to other stores within the mall.
- Is the Capture Rate of a store high or low?
- Is it maintaining its share of footfall?
- Is it losing share and might need support from the mall?
- Is it increasing its share and so could increase sales even further from a bigger unit?
- Is the store’s Capture Rate in line with other stores in the same retailer category? Ie. is the issue the fact that the demand for a particular type of retailer is declining?
The Capture Rate answers all of these questions, and more, relating to the performance of individual brands and retailer categories!
Success of marketing/promotions/events
Marketing/promotions/events are critical to drive more footfall into the mall, but ultimately their success is determined by the positive impact they have on individual stores in the mall. Tracking Capture Rates at the mall’s entrances and at individual stores before, during and post events delivers key metrics that enable the true ROI to be determined.
An event may appear to be successful as footfall entering the mall increases, but if its Capture Rate does not increase it could be that the mall is simply benefitting from an uplift in footfall in the town/city.
At the same time, it is vital to understand whether the initiative results in retailers attracting more customers – store footfall may increase which is positive, but the Capture Rate may actually decline if the retailer is not keeping up with the mall. A stable or increasing Capture Rate demonstrates that a retailer is capitalising on the increased footfall.
Comparing the Capture Rates of various retailers within the mall helps to identify which retailers benefit the most or the least from the initiative. The footfall to retailers in a certain part of the mall may increase during an event but their Capture Rates could still decline, indicating that the event/promotion is diverting customers to another part of the mall.
Attracting new retailers into the mall
Retailing is evolving more quickly than ever before and the challenge for malls is to be able to harness this by attracting the most appropriate tenants.
Capture Rates identify which stores and categories in the mall are the strongest performers in terms of attracting footfall and, as importantly, the extent to which this is changing. Footfall of a particular retailer category may decline but the Capture Rate identifies whether this is in line with the mall (stable Capture Rate) or whether it is declining more quickly (decreasing Capture Rate).
Comparing Capture Rates of individual store categories provides an understanding of the performance of the mall’s current retail mix – which categories have the highest Capture Rates and so which represent the best opportunity for the mall to offer customers the stores they are demanding.
The importance of adjacencies can be determined by tracking the Capture Rates of clusters of stores in different parts of the mall – identifying whether the siting of certain stores alongside others drives up their individual Capture Rates.
These factors – which can be identified, tracked and reviewed on an ongoing basis – can be incorporated into a leasing strategy to deliver robust metrics that demonstrate to potential tenants the value of trading within the mall.
There is clearly no denying the fact that the Capture Rate is a hugely under-utilised but enormously valuable metric in the evaluation of mall performance.
The next step is understanding how you can gather and apply this metric; and as with all aspects of the Capture Rate, it is a simple process with a very light touch on your business.