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Australian shopping mall owners not worried about e-commerce development


With the imminent descent of online platform Amazon into the Australian retail market, shopping mall owners say they aren’t worried about the pressures to develop digitally via e-commerce to stop international e-tailers from stealing their shoppers.

Concepts like a shopper’s need for real-world interactions, means mall owner Bob Ell has a strong view on the future of retail in Australia. He owns major centres in Queensland’s Ipswich, Morayfield and Victoria Point, and Tuggeranong in Canberra. For Ell, technology may not have such a painful effect on sales, thanks to ‘retailtainment’.

“Technology is obviously always going to have some effect and take a percentage away from the market,” said Ell in an interview with AFR Weekend.

“The Amazon shopping style will grow but there is still a thrill taking the wife and family shopping. It’s entertainment, people still want that. People don’t want to be locked up in the house all day, they want to get out and see what’s going on in the world.”

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While Westfield shareholders Steven Lowy, Frank Lowy and Peter Lowy remain confident that bricks-and-mortar retailing will remain strong for a long time to come, the billionaire mall operators are still rapidly deploying technology to try to track retailers and influence spending habits.

Doing thing in reverse is online Perth retailer Kitchen Warehouse. The retailer is pushing into physical stores on the Australian east coat, mimicking Amazon’s strategy of developing a bricks-and-mortar presence.

“The way forward for us is not as a pure play online retailer or bricks-and-mortar business, but as a combination of both. You have to offer both,” Kitchen Warehouse director Chris Murphy told the Financial Review.

Most Australian retailers have developed, or are looking at developing, omnichannel business models that incorporate the importance of a storefront and an e-commerce point of contact. Shaun Bonett owns several prime shopping centres in cities around Australia including Melbourne, Adelaide, Brisbane and the Gold Coast.

“Even the pure technology companies are now all including a bricks-and-mortar presence as part of the delivery of their products and re-enforcement of their brands,” Bonett told AFR.