PETALING JAYA: Local retailers remain optimistic about the industry’s recovery this year despite the Omicron variant and inflationary pressures which could pose a threat to the economy and consumer confidence.
Pavilion Kuala Lumpur Retail Managing Director Datuk Joyce Yap expects the retail sector to remain positive this year as long as no lockdowns or ‘heavy’ movement restrictions are put in place to curb the Covid-19 infections.
“Provided there are no further lockdowns or heavy restrictions, I am optimistic that the retail sector in Malaysia will benefit from the country’s economic growth with increased consumer spending and footfall in our malls,” she told StarBiz in an email interview.
She admits that the past two years have been one of the toughest times for the retail industry and that recovery to pre-pandemic levels will be gradual.
“I also hope that 2022 will bring the relaxation of border controls and quarantine, encouraging international travel and tourists to return to Malaysia, to further boost our retail industry,” she added. .
It expects retail sales to improve 5% this year from a year ago, with value-added merchandise a key area of growth.
“I also expect key growth in the retail sectors of health and wellness, food and beverage, luxury and premium brands, as well as household names with strong brand equity,” Yap said.
Retail Group Malaysia (RGM) in its latest report on the retail industry in Malaysia predicts a growth rate of 6% for the industry in 2022.
The report notes that the number of daily positive cases still remains of concern.
“A potential fourth wave pandemic is haunting Malaysian retailers.
“Malaysian non-essential retailers cannot afford another forced closure of physical stores.”
Although many consumers are opting for online shopping, Yap pointed out that malls continue to be the center to meet the needs and wants of the community,
“After being cooped up at home during the lockdown, shoppers are increasingly looking for experiential retail inside and outside commercial spaces, as well as omnichannel and immersive shopping experiences,” said she declared.
Still, she said retailers should keep up with consumer trends and adoption of the digital space shouldn’t be seen as a disruption.
Yap said the online platform was an additional channel to educate and provide in-depth product understanding and expand information dissemination.
Citing Think With Google marketing research, Yap said 51% of offline purchases were reported to be digitally influenced, showing that digitization can be used as a tool to increase footfall.
“For example, taking greater advantage of digital channels to deliver timely promotions and offers to more consumers.
“For our malls, we have used this time to build, innovate, improve and deliver more value to our customers.
“For example, we launched Pavilion KL and Pavilion Bukit Jalil mobile apps, which we use as fast and convenient platforms to roll out our rewards campaigns,” she said.
“It’s important for retailers to keep up with consumer trends and go digital,” she added.
Yap thinks retailers who can react quickly and evolve with the changing market will do well.
“The pandemic has accelerated our digital economy and it’s important for businesses to keep pace with changing consumer behavior and embrace digital solutions,” she said.
In terms of the inflationary pressure that has driven the price of goods, Yap said consumer purchasing power will remain stable and businesses should see this as an opportunity to pivot to meet consumer demand.
“Despite inflation and rising prices, consumers in the middle to upper income brackets are looking for value-based purchases and are looking for exclusive premium products with added value.
“Interestingly, we’ve noticed that our luxury tenants, particularly those releasing exclusive or limited collections, have seen greater retail usage than before the pandemic,” she said. declared.
Yap noted the importance of continued aggressive marketing strategies to attract shoppers to malls and drive spending.
“We are committed to continually improving our facilities and services, and remain steadfast in our support for retailers.
“For example, we’ve embarked on a number of voucher bonanzas as part of our rewards program that have proven to be very effective in driving spending,” Yap said.