Sunday, November 25, 2012

What are they thinking with the free Wi-Fi at the mall?

Simon Property Group, Inc. (NYSE:SPG) is an S&P 100 company and the largest real estate company in the world. The Company currently owns or has an interest in 332 retail real estate properties in North America and Asia comprising 241 million square feet as well as a 29% interest in Kl├ępierre, a publicly-traded French REIT with a portfolio of more than 260 shopping centers in 13 countries in Europe. They are headquartered in Indianapolis, Indiana and employ approximately 5,500 people in the U.S.

  If you visit you will most likely find a Simon Property Mall near you. I went shopping on “Black Friday” with my two sons, mostly for the entertainment factor. Of course it was at a Simon Mall.

Here is what I found to be amazing. The entire mall had free Wi-Fi, even in the parking lot. Every shopper in the mall had smartphones in their hands. Not just cell phones - but smartphones.  I would say that most had iPhones, but I could not find a “regular” cell phone in the building.

For the first time I witnessed people using their smartphones while they were actively shopping. Simply scanning the bar codes of the item told you if the price on the item you were look at was good, great or terrible. It showed you what you could get the same item for online, also saving you sales tax and shipping. It showed product reviews. It was like having a professional shopper in your hand. All it took was one person doing it, and everyone would learn from the leader. People would say to strangers "would you scan this for me" if they did not know how to do it. 

And let the haggling begin!

I saw people holding up their smartphones, showing the clerks behind the counter why their sale price was no good. Or why they could get it cheaper online. Or why the store 200 feet away had a better price, or had a better instant coupon. All of these poor kids with holiday jobs at the mall, they did not know what to do but shrug their shoulders and smile. Happy Holidays!

Here is the question: why did the largest real estate company in the world give FREE Wi-Fi to everyone in the mall - so that the smartphone shoppers could beat up their rent paying tenants in said mall? Many people did not need the free Wi-Fi to use their smartphones, but now Simon Properties made it way too easy. By giving free Wi-Fi to every single shopper, they basically gave all the power to the consumer. Anyone with an item “on sale” at 50% off was caught red-handed, as we all can see that they just raised the prices just days before to then offer the 50% off discount. How embarrassing for the store owner.

Shopping with a smartphone. The smartphone genie is officially out of the bottle. The shopping malls of the future will continue to morph. Retail stores will need to compete against the smartphone shopper, battling against free shipping, no sales tax and hassle free returns without having to leave your home or office.  

I did my best to shop locally on Small Business Saturday, but it was very hard to not check pricing with my smartphone. I knew I was paying more, but I was supporting my local community. I don’t know how long this will last, but I am thinking that the era of the smartphone shopper is here to stay. 

And not just during the holidays.

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