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Westfield marketing boss questions long term future of pure-play online retailers

Screen Shot 2015-09-17 at 5.52.34 PMThe marketing boss of Australia’s largest shopping centre owner has dismissed the threat of online-only retailing, arguing “very few” pure plays have ever made a profit.

John Batistich, marketing and digital director of Westfield owner Scentre Group, even questioned how many of them will be around in five years as he launched a robust defence of the shopping mall, insisting people still “crave physical experiences”.

Responding to reports from the US that many shopping malls are suffering and will shut down, Batistich referred to a decade-old story from Fortune magazine which also foretold the demise of the physical store environment.

Describing the story as “rubbish”, he told a conference that “things have changed dramatically” since the days when online saw annual growth of 30 per cent.

Today, sales growth at Westfield shopping malls are almost on par with that of online, he said.

“Physical retailers at Westfield…..are growing in line with how online in Australia is growing,” Batistich said, adding that bricks and mortar still generate 93 per cent of sales.

“In Australia online had been growing at 20-30 per cent but it is now growing at only 6.9 per cent and Westfield is growing at 6.1 per cent on $21b worth of retail.”

While acknowledging online-only sales remained as “issue” for the physical environment, the Westfield executive said the demise of the shopping mall has been “exaggerated”.

“Humans crave physical experiences,” he told the Forrester marketing leaders summit in Sydney.

“What we are focused on at Westfield is connecting the physical environment with the digital shopper.”

That meant driving people to shopping malls by creating experiences, services and products that cannot be replicated online, he said, including “food experiences” and a focus on health and beauty.

“You can’t download a meal and you can’t subscribe to a haircut,” Batistich said.

Westfield was also set on creating location and analytics platform to help brands create “personalised, contextual content for the future”.

“We are helping shoppers move from web to store because the big game in town is not online,” he said. “There are very few pure play retailers which are making any money and who may not be in this market place in five or 10 years time.”

He added: “At Westfield we have stopped talking about multi-channel and omni-channel because our customers don’t talk that way. Our focus is around one seamless experience.”

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