Facepaint, skate parks and Katy Perry – how Westfield turned malls into living centres
Why go to a shopping centre when you can browse from your sofa? Putting customer experience at the heart of its business, the 60-year-old Westfield beats the odds to thrive.
At Mumbrella360, Scentre Group’s director of customer experience, Phil McAveety, vowed: “We can’t just be in the shopping centre business anymore.”
Quite a statement from a company with 41 Westfield shopping centres, 535 million annual visits and assets valued at more than $54 billion.
McAveety, of course, was not announcing Scentre Group’s sensational exit from the shopping centre business, but articulating the philosophy that has characterised the company’s recent strategy.
Part of this evolution has seen Westfield repackage its shopping centres as “destinations” and “living centres”.
“If we think we’re in the shopping centre business, we’re just going to work in that way. So, we don’t talk about shopping centres anymore. We don’t use the ‘M’ word because if you say mall, psychologically, it takes you to a certain place in your head,” McAveety said. “We need to be in a broader world, in what we call the ‘living centre’ business. We need to be providing destinations where people choose to go and spend time, to live. They may shop, they may not. They may do a whole range of things.”
On a journey that started a few years ago, Westfield has transformed its approach from being a real estate company where retailers were its principal customers to one where shoppers are at its very core.
The success of extraordinary retail is evident across the Westfield living centre portfolio, with 437 new brands introduced into Westfield centres and 317 existing brands growing their store network within Westfield during 2018.
“We are now a customer-led, customer-focused business that just happens to deliver that customer through a real estate platform,” McAveety said. “That may sound like a nuance. But for a 60-year-old business that has led the category, it was a fundamental change in how we think and operate.”
In outlining Scentre Group’s journey, McAveety said, “It was clear to us that customer behaviour was changing and we needed to change with it. Customers are more connected, they are always-on and they are more informed about brands and product.
“But they are also demanding vibrant and stimulating environments which deliver extraordinary experiences, and if they don’t get that then they – and their wallets – will go somewhere else.”
“It’s not enough for us any longer to be just a curator of retail and brand experiences. We really need to be a creator of the overall customer experience. In an increasingly digitised world, there’s often a tendency to think physical destinations are less relevant or necessary. I tend to be more optimistic and think there’s huge opportunities for destinations.”
To support this, last year there were more than 14,000 events and collaborative brand activations across Scentre Group’s portfolio of 41 Westfield living centres, everything from face painting to hosting pop star Katy Perry as she promoted her world tour.
At the new Westfield Coomera living centre on Queensland’s northern Gold Coast, for example, more than 40 per cent of the space is for non-traditional retail. There is an area called “The Backyard” which has a water play area for kids, and BBQ pits for families.
“You can bring your own food, you don’t have to buy anything from the centre – although it is all there if you want to,” said McAveety. “But it’s creating that sense of community and sense of belonging.”
“Fundamentally, I believe we need and want to come together for a sense of belonging and a sense of discovery.”
Yet for all the face painting, skate parks and sense of community, Scentre Group acknowledged that, ultimately, it’s a profit-making entity, with shareholders and retail partners to satisfy.
In the last three years, Scentre Group’s Positive Reputation and Net Promoter Scores have both risen steeply. This means that not only are customers happier, but it’s proof that better CX delivers commercial outcomes.
“The higher you go in terms of NPS, the higher your sales are going. There is business delivery here, and it’s not just about doing the right thing, it’s about delivering great outcomes. We want to do both – but elevating the customer experience is the key.”