E-commerce has brought a new issue to physical retail. Real estate companies building shopping malls are in truce with giant retailers like Zara, H&M, and others. The issue raised with Zara promoting their online store into their physical store located in a mall space. The developer raised the issue but could not stop them legally as the agreement did not have the terms related to this. The revised agreements started coming with a clause restricting retailers promoting their online shops inside the physical store.
Actually, the business terms between property owners and retailers were to share the revenue out of the sell happened. But the online commerce (say increased omnichannel practices) has started moving offline revenue to online. This left retailers with a clear benefit and builders at a loss since customer came to a physical store but bought from the online channel. So retailers earning all the share of sell and builders get nothing. In latest update into lease agreements real estate developers have started asking for a minimum fee as well along with revenue sharing.
In the benefits of consumer, retailers and real estate developers, setting up right omnichannel practices are essential. Retailers can’t rollback the online shopping habits. On the other side, people won’t ever shop 100% online. In fact, people don’t go to malls just to shop but to spend their time as well. So mall will keep getting millions of footfalls. So co-existence is the only way. I am sure this temporary tussle will improve omnichannel shopping capabilities for users finally.