Australian shopping centre specialist Westfield has set up a special lab in Silicon Valley, California to monitor the physical and digital realms of shopping as they converge into what is becoming known as the ‘phy-gital’ world.
Australian shopping centre specialist Westfield has set up a special lab in Silicon Valley, California to monitor the physical and digital realms of shopping as they converge into what is becoming known as the ‘phy-gital’ world.
Westfield Labs is the brainchild of the company’s co-CEO Steve Lowy, delegates at ICSC Europe’s annual conference in London, learned on Tuesday. ‘We set up Westfield Labs to solve the needs of the changing consumer,’ Lowy said in a video message shown during a keynote address by Kevin McKenzie, group chief digital officer at Westfield Labs. ‘We are open-minded on where this can go for the industry,’ Lowy added.
A key driver behind the initiative is the fact that everybody has a mobile device these days, McKenzie explained during his presentation. ‘The management team at Westfield really started to see that the consumer is changing with mobile devices and that they are looking for new experiences created in a physical world.’
Westfield has already done a lot of things in the digital space, but the purpose of Westfield Labs is different, McKenzie said. ‘This is a major platform and it has a mission: how can we use technology to drive traffic for our retail partners. This is not a one-off initiative, we are building a platform that is robust and which has scale. There is a huge opportunity for digital technology in the physical retail world.’
Data is key, he added. ‘It’s amazing how well data can inform you. Silicon Valley has an amazing amount of innovation. But it’s one thing to create new technology and it’s quite another thing to have the physical reach and access that Westfield has to so many consumers. When we joined Westfield, we saw the same opportunity in the physical world.’
Westfield is active in many different areas of shopping, including core locations like in London to retail in airports, McKenzie said. ‘Altogether Westfield hosts 20,000 retail outlets.’
Computing on the go
Advances in technology such as beacons, sensors and wifi are enabling retail landlords to track consumers and generate data about consumer behaviour and patterns, McKenzie said. The technological advances are ‘dramatic’, he added. ‘Computing on the go is offering enormous opportunities to collect data in a very similar way to data collection online.‘
One of the approaches Westfield Labs has adopted is to work together with software builders and start-ups, McKenzie said. ‘We do a lot of partnering. It’s so easy to get capital in Silicon Valley and there are a number of new start-ups on a weekly basis. What they really value though is distribution.’
One of the projects Westfield Labs has embarked on with a local start-up is same-day delivery and fulfilment houses. Another initiative, Dine on Time, which Westfield is piloting at its London centre, revolves around an app with a digital offering of a food court in a physical shopping centre where consumers can order a meal in advance and pick it up at a designated time.
‘Time is currency,’ McKenzie explained. ‘Some consumers don’t want to deal with the rush of people that come into a food court at lunch hour. What we aim to do is see how we can use technology to make that experience better.’
Express parking controlled from a phone or computer is another service Westfield has embraced. ‘Parking can be awful for consumers,’ McKenzie said. ‘We have put a lot of thought into how we can make that experience better. Our Express Parking is a very successful programme.’
At present, Westfield is experimenting with a number of different initiatives in different shopping centres around the world, but these experiences will eventually come together in all its major shopping centres, he added. ‘We pilot these things in one or two shopping centres to test our hypotheses and assumptions. It’s all about not being afraid to fail and iterating really quickly.’