With the massive success of e-commerce in China, people expect malls to be more than a destination to buy things. They want an engaging experience and a place to spend their leisure time.
Real estate companies have long honed a successful business model of replicating tried and trusted shopping centers across cities. China Resources Land (CRL), a leading Chinese real estate company, approached IDEO to rethink this model and create greater value within their existing properties.
Consumers’ needs and tastes are rapidly changing and it’s driven us to rethink how China Resources Land contributes to an improved quality of urban life.
Zhang Dawei, Senior Vice-President, China Resources Land
The Galleria Shopping Centre is one of CRL’s key commercial projects in Northern China, located near Beijing’s Central Business District. Historically, food and beverage businesses accounted for nearly 40% of its tenants, and had been instrumental in attracting customers to the mall. However, when the development’s food court started to age, CRL identified an opportunity to not only update its aesthetic, but to redesign the entire customer experience.
Taking a human-centered approach, IDEO and CRL asked: Who is the target market for a newly designed food court? How do we identify a distinct value proposition? What kind of business model would make such a proposition viable?
Traditionally, most food court spaces are leased to chain operators. The team believed that for Galleria to achieve a true upgrade, they would need to move beyond an efficiency and operations-driven approach to one that’s led by a deeper understanding of visitors’ food and beverage needs.
The IDEO team led immersive research with populations who lived and worked in the area. It became clear that visitors have distinct modes of selecting and consuming food that fluctuate depending on the time of day. At times, food is social—a way to catch up with colleagues. At others, it’s solitary—a quick breakfast on a morning commute. Sometimes food provides comfort and familiarity; other times, it’s an opportunity to try something new.
These insights informed a holistic food and beverage strategy for Galleria. IDEO reimagined the mall’s food experience as a diverse portfolio of offerings working together to fit customers’ different needs. Four zones were designed: one for Asian foods that provided comfort via specialized stalls; another for freshly prepared Western food with fast-casual service; a market zone for breakfast and snack; and a lounge area for off-peak activities and space to work or socialize.
Work-in-progress research and strategy for the proposed food court zones.
The business model that IDEO and CRL co-created went deeper than the conventional food court operations model to consider the appropriate product-offering mix, customer visit duration, general price ranges, and vendor screening standards for each zone. This strategic plan enabled CRL’s operations team to thoughtfully curate vendors and quickly implement a diverse set of high-quality and popular food brands.
Working with IDEO has given us the confidence to evolve. We learned the importance of focusing on customer needs, instead of getting distracted or overwhelmed by industry trends.
Meng Yunyun, Director of Business Innovation (North China), China Resources Land Limited
The CRL team quickly implemented the Galleria strategy in the year following their engagement with IDEO, reopening the food court in February 2019. The different zones have since become bustling places where people come for more than just a meal—colleagues converse over coffee, teams host off-site brainstorms, and vloggers livestream from the snack stand.
The reopened food court at different times of the day.
Since the revamp, customer visit times have noticeably extended and revenue has tripled. The Galleria is attracting younger consumers and desirable “affordable luxury” brands are inquiring about becoming tenants, hosting events, and creating co-branded experiences within the mall.
CRL plans to scale the design of this food court experience in a new mall opening up in Jinan in September 2019.