Calculating the KPI: the efficiency of the shopping mall's marketing communications
Nataliia Dmytrenko, Chief Marketing Officer Arricano Real Estate Plc: Calculating the KPI: what indicators help determining the efficiency of the shopping mall's marketing communications
The commercial real estate and shopping malls, in particular, are the same territory for marketing and PR, as well as any other goods and services market. Goods - Promotion - Purchaser - in the shopping mall are all the same, but more interesting. Shopping center's marketing has to work with target audiences both in B2B and B2C. This has its own difficulties and challenges, but it is more interesting for performance metrics building - what we call KPI.
The KPI theme always evokes a keen interest in the audience at profile retail & development events. And that makes sense: on the one hand, metrics are needed by the shopping mall’s CEOs and owners - they must be sure that people in marketing and PR are really efficient guys, and their efforts can affect something. On the other hand, marketing KPI affects the payment and bonuses level in many companies. And I have news for both the first and second: KPIs no longer work in the form in which we are all used to measure them. Everything is much more complicated, and it is impossible to apply a standard formula without taking into account the individual parameters of the facility, its development strategy, the company's goals and the team in particular. Let's consider only some KPI indicators.
Shopping center's attendance. Not so long ago, the attendance has almost been the facility's efficiency key parameter. Today, we investigate traffic not only quantitatively, but also qualitatively. Thus, attendance is supplemented by a new aspect: the facility sales level as a whole and by tenants' categories. Is the attendance a marketing achievement only? I don’t think so - this is a cumulative parameter influenced by the marketing activities of the shopping mall, tenant mix, the activity of the tenants themselves, and the level of comfort inside the facility. Can the attendance be one of the KPIs? Yes. The question is how to compare. Right: from year to year, month to month, and so on.
Tenants' turnover. The difficulties may be found here. Not all tenants report, some report, but not for the entire sales volume. At the same time, together with attendance, the tenants' sales figures allow managing company determining the traffic quality and the entire facility's efficiency.
Tenants' marketing support. This indicator can be considered in different ways: the number of joint shares for a certain period, the number of tenants' processed applications. Anyway, today, it is difficult to imagine the shopping center's effective marketing without the tenants' participation. The more joint projects marketing implements, the higher this KPI will be. However, while assessing its effectiveness, we look at these tenants' turnover, the incoming visitors' number, conversion (if there is access to such information).
Marketing income. In addition to this fixed marketing payment, each shopping center has an additional chance to earn. And marketing sells a certain set of services for tenants and third parties. This is an excellent tool for KPI, because it is unambiguous (whether there is a gain or not), it is very easy to count, and finally allows the marketing team pimping sales skills. A useful exercise, don't you agree? And it is even more for commercial activities.
Spot efficiency measurements. This parameter concerns mainly small events, in the expediency of which it is necessary to be sure. The spot measurements can be performed with by offline and online polls (Do you like the event? Why?), or by registering for an event, if it is stipulated by the concept (guests register actively - excellent, everyone is sluggish - perhaps this is not quite the right event). The visitors' number directly at the event is also an indicator.
Special projects. This is an indicator that works great for evaluating and stimulating the marketing teams' creativity. Many shopping centers' marketing teams demonstrate innovative ideas, implement bold and bright projects. It's not about projects that require a large budget - it's more about creativity. We in Arricano are used to strike marketing projects that no one has done before, and even better - to become partners with such project in such a way that it could allow optimizing all the resources, not only financial, but also human ones. A competent conceptual partnership is a very valuable device for a shopping mall, and if marketing makes a wow-project it would be worthy of a medal. The minus of such a KPI parameter is that it is more subjective and is assessed according to the scale adopted by the company. The creativity is also difficult for assessment because unusual and creative projects have a deferred effect; often they «switch» the attention of the TA to a specific shopping mall. A good hype has not bothered anyone yet.
Web-sites and social networks. Everything is transparent and understandable with such parameters: the visitors' number, subscribers' growth, engagement, coverage ... The settings allow all these metrics to be monitored and checked. Another issue is that there have been disputes for a long time: does the number of likes affect the shopping mall's actual success? I believe that yes, to a greater extent, under one condition: the authors of the facility's page in social networks know that subscribers are residents of that city or at least the country in which this shopping mall is located. The environmentally friendly shopping mall's SMM policy operates in its favor, and not in a parallel reality.
Media field research. Mass media periodic or regular monitoring will show how often the facility's name is mentioned in the media field, in what context, in the media of which level and positioning. It is also useful to assess the shopping mall's presence in a media field, where other objects are present, formally (on the basis of the facility's category) or objectively (a direct competitor for a number of characteristics) that provides competition for your shopping mall. The indicator refers to PR activity and can be divided into the context field assessment in both B2B and B2C.
There are many other parameters that can be taken into account while developing a shopping center's KPI. It is even possible to calculate the cost of each new attracted offline and online visitor and simply the cost of attracting each guest. However, if these calculations are relevant - the question may emerge. The fundamental parameters, on the basis of which it is possible to determine the efficiency of the shopping mall's marketing communications, are listed below.
Almost all these KPIs can be accurately calculated. And you can still add 5 - 10 indicators. For example, vacancy. Both for the shopping mall's visitor, and for the tenant (new and existing), vacancy is a success marker. Zero or approaching to zero vacancy is the result of great teamwork. Potential tenant, while analyzing the shopping center as a new site, draws attention to the existing tenant mix, and marketing activities. Does the shopping center's name sound familiar? Is there anything interesting happening there? And what about the social networks they have? Definitely, the KPI is the teamwork’s story, painstaking and coordinated, in which every participant of the managing facilities' process wins and everyone is interested in the result.