Real estate investment expert Miguel Sanchez Navarro Madero posted recently about the challenges that bricks and mortar retailers face from online. If you haven’t seen it, take a look here – it’s well worth a read. In that post, he outlined some of the very real issues facing physical stores in the coming years.

The rise of digital retailing is having a particularly powerful impact on shopping centres.

The future of shopping centres

Take the latest research from the experts at Credit Suisse. They predict that up to a quarter of US shopping malls will be gone in the next five years. So, does this mean that time is running out for shopping centres?

Miguel’s sense is that the reality is more complex than that. He believes that technology actually presents many more opportunities for shopping centres than threats. The key is that shopping centre retailers and owners seize them now, before it is too late.

The traditional shopping centre – the kind that readers might remember from the 1970s, 80s and 90s – is dying. But new technology promises an opportunity for the rebirth of shopping centres as a mix of high-tech convenience and low-tech customer service and human authenticity.

So, what does this opportunity look like? What are the key technologies that will help to keep shopping centres relevant in the coming years?

Artificial intelligence (AI) helps to predict and manage behaviour

“While some people feel threatened by the potential power of artificial intelligence, it holds great promise for transforming the world’s shopping centres,” says Miguel. “The technology offers a number of potential applications.”

For retailers themselves, there is a big opportunity in the area of data analysis and predicting shopper behaviour.

“AI will help retailers to understand their customers better, allowing them to profile them and assess the effectiveness of adverts and promotions,” he says. “AI data models will help to monitor and even predict performance, both of staff and of products. And AI can provide retailers with a detailed breakdown of how customers behave, in real life, in their physical store.”

For shopping centre owners, AI will help them to increase the efficiency of the store and allow them to optimise everything from the way they price different rental units to the layout of the mall itself. And again, AI prediction models can help mall owners to optimise staff rotas and stock levels.

Facial recognition means a more personalised service

Facial recognition will be one of the cornerstones of the new shopping centre experience. Online, we’re already used to the idea of a particular retailer knowing who we are and making suggestions about the kind of products we might like. Facial recognition in physical stores within shopping centres allows this to happen in a bricks and mortar store. The in-store team (or perhaps your augmented reality glasses or smartphone app) will suggest products based on your likes as you walk around. Personalisation is everything now, offline as well as on.

No pay stores are on their way

Building on this kind of facial recognition technology, we will also see the rise of ‘no pay’ physical stores. Amazon are already doing this with their bricks and mortar stores.

The idea is that you move through the store choosing the products you want, with your shopping behaviour constantly monitored by cameras. And, because it is now possible to pay wirelessly, payment for the products you want is taken automatically, with no need for cash or a card.

Augmented/virtual reality dressing rooms help you try before you buy

One of the biggest draws of traditional shopping centres for many shoppers is the chance to ‘try before you buy’. There have been some advances, but buying online generally doesn’t allow you to try different styles or colours on.

In the shopping centres of the future, augmented or virtual reality mirrors in dressing rooms will allow customers to try clothes, without actually putting them on. You’ll be able to quickly swap styles, colours or sizes seamlessly.

Or, if you’re shopping in a physical store for a piece of furniture, augmented reality will allow you to see if it looks good in your room.

Miguel tells us this is a good example of how the physical and digital worlds will come together in shopping centres of the future.

“People want to try before they buy,” he says. 80 per cent of 50-75 year olds like to try clothes before they buy, rather than just clicking online. “AR or VR is a way to make that experience even easier for them, while still drawing people into a physical store.”

There is even the opportunity here for completely stockless shops. These would be physical spaces within a bricks and mortar shopping centre, offering augmented reality products and same-day home delivery or pick up.

Communal tech experiences

“Technology is at its most powerful when it brings people together, and this will be key for the shopping malls of the future,” says Miguel. “They will become far more than just places to shop, and more of an entertainment destination. They will be somewhere you go to play video games together, to watch movies or to eat and drink with friends.”

So, in this way, shopping centres will leverage the biggest advantage they have over the digital only retailers: they are a place where people can interact and have shared experiences. Technology will play a pivotal role in making this happen.

Ultimately, it is important to see that the lines between on and off-line will become increasingly blurred, in every aspect of our lives. The fact is, in the future, there won’t be just online retailers, or just bricks and mortar ones.

This is happening already – see how Amazon are moving into physical stores, while traditional retailers are upping their online offering. With the advent of technologies using AI, augmented reality, or digital implants, the physical and digital worlds are merging. We’ve seen this to an extent with the ‘internet of things’, and we’ll see this increasingly in shopping malls.

But, what will set the successful malls of the future apart?

“They will bring together all the authenticity, and the tactile, emotional experience of a traditional store with the convenience and smart data handling of digital retailing,” says Miguel. “The key is that all of this needs to be a seamless process between a customer’s smart device, the in-store team, the mall owner and the wider supply chain.”

Technology must always enhance our experiences, not hinder them – and if we get this right, shopping centres have an exciting future ahead.