How Malaysian retail is adapting to consumers’ changing behaviours

From concept stores to niche groceries to digitalisation efforts, retailers are going all out.

Amid shifting shopping patterns and evolving e-commerce landscape in this age of digitalisation, Knight Frank says retailers and mall operators in Malaysia are increasingly leveraging on flagship and specialty stores to increase sales and improve engagement. 

Retailers across the spectrum have introduced new flagships and concept stores such as Mothercare in Suria KLCC, llaollao in Pavilion Kuala Lumpur, MINISO in Setia City Mall, and Grand SenQ in Cheras Leisure Mall, among others. Aside from enhancing the shopping experience, these stores aim to evoke an emotional sensation and create a statement, which ultimately strengthens the brands’ image and customer loyalty. 

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Meanwhile, the opening of K Plus Food Market at The Curve, which offers an expansive range of Korean consumer goods shows the growing popularity of ethnic grocery such as Jaya Grocer’s Korean Grocer and Don Don Donki. The rise of niche grocery with smaller store formats is also concurrent with the growth of ready-to-eat convenience stores, which include FamilyMart, CU, emart24, and 7-café. 

With the changing landscape in consumers attitudes, behaviours and purchasing habits, retailers are adopting omnichannel strategies, and placing greater emphasis on convenience and accessibility as well as creating immersive experiences to drive sales. 

Adapting to consumers’ on-the-go lifestyle, several retailers including Texas Chicken, Subway, The Coffee Bean and Tea Leaf, Starbucks and Taco Bell, are expanding on their drive-thru outlets. The rise of these outlets seeks to provide better reach and greater service to consumers, while increasing the retailers’ profitability. 

To further enhance consumer experience, retailers including Starbucks and Tealive are actively accelerating their digitalisation process for ordering and payment methods. Tealive is implementing various cashless and contactless ordering channels such as scan-to-order, order ahead and drive-in or pick-up models. 

Retailers such as Senheng are expanding their payment methods by offering Buy Now Pay Later (BNPL) options which enables consumers to benefit from flexible deferred payments. Supporting affordability and making products more attainable for those without access to card scheme instalments, the recent partnership between Razer Merchant Services and Atome, is expected to further accelerate the adoption of BNPL, online and offline. 

Leveraging on its ecosystem, airasia Super App has launched an intercity food delivery service. Utilising its low-cost carrier services to fly delicacies from Penang to Klang Valley, this unique service enables airasia’s retailers to reach a vast audience. Although only available on Wednesday, the delivery service is expected to increase frequency and involve other states.