Marketing Perspective (MALL-- June 14)<\/p>\n
Great sales! Shop until you drop<\/p>\n
Arif T. Syam
\nContributor\/Jakarta<\/p>\n
Are you a window shopper or a shopaholic? If you are the
\nlatter, you will be in your element during the Jakarta Great
\nSale. During this event, which will be held from mid-June to mid-
\nJuly, shopping centers in Jakarta will compete with one another
\nto slash prices for buyers.<\/p>\n
In addition, to draw shoppers, a series of attractive
\nentertainment programs will be held in shopping centers, ranging
\nfrom the presence of celebrities to a variety of contests. In
\nshort, Jakarta will be a haven for shoppers.<\/p>\n
Jakarta Great Sale, held in conjunction with Jakarta City's
\nanniversary, has been designed along with other programs held in
\nthe city's recreational centers and several housing complexes in
\nthe city.<\/p>\n
Jakarta has recently witnessed the emergence of many new
\nshopping centers. Almost every day there are advertisements in
\nthe print media about the opening of these centers or the
\ncommencement of the construction of a new mall.<\/p>\n
Sometimes the advertisements give information about certain
\nprograms and special discounts.<\/p>\n
A look at the growing number of structures being built will
\nshow that the Jakarta residents in particular and Indonesians in
\ngeneral, are being increasingly pampered. The greater number of
\ncenters also means keener competition. At the end of the day,
\nbuyers will be able to enjoy the most competitive prices.<\/p>\n
The trend in the construction of shopping centers has also
\ncaused some worries among economists because many kiosks and
\nstalls are unoccupied, closed, or offered for sale or for rent.<\/p>\n
This situation gives the impression that investment in the
\nconstruction of these buildings has been wasted or there are huge
\nbad debts involved.<\/p>\n
In spite of this, construction never seems to stop. An
\nillustration of this is the annual report issued by PT Procon
\nIndah indicates that this year there will be many more shops and
\nkiosks that remain unoccupied.<\/p>\n
As many new buildings housing shopping centers have emerged,
\nthe supply of kiosks that these buildings offer has also risen.<\/p>\n
The report says that up to December 2004, Jakarta had a supply
\nof 1.89 million m2 of buildings for shopping centers. In Depok,
\nBogor, Tangerang and Bekasi -- or Debotabek - the supply of
\nshopping center space has risen to 567,000 m2. In 2005, it is
\nestimated that the combined supply of space in Jakarta and
\nDebotabek will almost double to 3.47 million m2.<\/p>\n
According to the report, around 427,860 m2 of the entire
\nshopping center space provided in Jakarta and Debotabek will be
\nunoccupied.<\/p>\n
This means that the occupancy rate has yet to reach 90 percent
\nof the total supply, or, to be precise, this rate stands at only
\n82 percent to 83 percent. A greater area is expected to remain
\nunoccupied as more new malls or shopping centers emerge.<\/p>\n
\"These shopping centers need some time to reach the optimum
\noccupancy rate,\" said Lini Djafar, director of PT Procon Indah.
\nAs a result, the average occupancy rate in these areas will drop.<\/p>\n
According to PT Procon Indah, Jakarta will see the emergence
\nof new shopping centers like Roxy Square, Mangga Dua Square and
\nTanah Abang Wholesaler Center. Meanwhile, Debotabek will witness
\nthe opening of Plaza Sinar Merdeka Mas, Mahkota Trade Center and
\nITC BSD this year.<\/p>\n
PT Procon Indah issued a report in 2003 flashing a red light
\nat the property industry in the retail sector warning of the
\ngreat amount of unoccupied space in shopping centers.<\/p>\n
However, as time went on, businesspeople were increasingly
\nupbeat about Indonesia's economic conditions and there was an
\nincrease in the sales of kiosk space in shopping centers.<\/p>\n
The building management of shopping centers realize the need
\nto organize events to attract the public. They often use one or
\ntwo anchor tenants to attract visitors. These anchor tenants will
\nalso attract other vendors to set up business in these centers.<\/p>\n
The emergence of combined mall and shop-office blocks like
\nMegaglodok Kemayoran (MGK) is interesting, observers say. MGK has
\nbeen built using a totally different concept from that used in
\nother shopping centers. Intended to serve as a shopping center
\nfor industrial products and electronic goods, which are usually
\nfound only in Glodok, Kota, the mall should also have competitive
\nprices because many of the Glodok traders are expanding their
\nbusiness there.<\/p>\n
\"We have built a mall with a different concept from other
\nmalls or shopping centers that are springing up fast everywhere,\"
\nsaid Suhandi, the marketing director of MGK. MGK is also much
\ncleaner and more modern in appearance than the traditional,
\ndirty, crowded and run-down Glodok-Kota area. Not surprisingly,
\nall the spaces in MGK were sold by September last year.<\/p>\n
In addition, MGK Mall will also house the Indonesian Marine
\nCenter (IMC), which will be the only one of its kind in
\nIndonesia. The IMC, a center dedicated to promoting boat-building
\nfishing and other sea-based activities, will occupy an entire
\nfloor. \"Hopefully, the IMC will encourage the revival of the
\nmaritime industry in Indonesia,\" Suhandi said.<\/p>\n
Location is vital to determine whether a shopping center will
\nattract vendors or visitors. Bekasi Trade Center (BTC), which is
\nlocated close to the East Bekasi exit toll gate has no competitor
\nin the area. The BTC has taken only a short time to attract
\nvisitors although it has no anchor tenant. A similar situation is
\nfound at the Cililitan Wholesale Center (PGC). Around the PGC
\nyou can find only the Ramayana Shopping Center and Kramat Jati
\ntraditional market, both less attractive in appearance.<\/p>\n
Another factor that can attract both vendors and visitors to a
\nshopping center is the promotional programs the building
\nmanagement organizes. Many shopping centers organize these events
\nfrequently to attract visitors.<\/p>\n
Print ads or banners put up on the roadsides are commonly used
\nto keep the punters rolling in. Generally, these malls organize
\nentertainment programs or invite celebrities for a meet-the-fans
\nevent.<\/p>\n
\"Meet-the-fans programs are quite effective in attracting
\nvisitors to a new shopping center,\" said Sandi Ariandi of Benang
\nMerah Communications, a marketing-communications company that has
\norganized similar events in a shopping center in North Jakarta.<\/p>\n
Kelapa Gading Mall (MKG) organizes these programs every month.<\/p>\n
The Jakarta Great Sale, of course, is a mega-version of this
\nkind of promotional event. The sale organizers hope to change the
\nshopping atmosphere the entire city, creating a more colorful and
\ncompetitive environment.<\/p>\n
The question mall operators must ask themselves is how
\nprepared are they? Will they make use of this opportunity or will
\nthey simply let it pass without leaving any impression on
\nprospective visitors or buyers?<\/p>",
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