New Zealand's largest mall owner, Westfield, is looking at new ways to connect to its millions of customers and could consider electronically tracking their movements around its 12 malls here.

More than 500 people gathered in Auckland yesterday to hear about the changing face of retail and Justin Lynch, Westfield New Zealand director, said the main theme at the seminar at The Langham Auckland was 'the connected shopper' which he described as "a game-changer in retail".

The seminar looked at how shoppers interact with the their physical surroundings, the internet, Facebook, Twitter, their cellphones, other social media.

Westfield has a $1.4 billion investment in the malls with 437,483sq m which give total annual sales of $2.2 billion.


"With bricks and mortar, we're looking at how we connect to the shopper. We have invested in fibre optics and we are investing in Wi-Fi, mapping and GPS in malls and investigating the shopper journey," Lynch said.

On Friday, he spent six hours with American retail consultant Mike Lundgren, partner and director of innovation strategy at Kansas City-based VML who spoke at the seminar.

"Mike told us we need to do something because standing still is not an action within this environment. Mike asked us how we are connected and I've been dwelling on where Westfield is in this space," Lynch said.

Lundgren said social media could cripple a retail product. He cited how an internet video had adversely affected people's confidence in a commercially available lock when it was shown the lock could be quickly picked with a ballpoint pen.

On day four, the manufacturer denied the problem but by day 12 the product was severely damaged, Lundgren explained. And he warned that denial or spin could lead to further ridicule by bloggers and critics.

The locks were later changed to stop pens or other cylinder shaped objects defeating the locking system.

"If Facebook was a country, it would be the third largest in the world," Lundgren said, describing how people spent on average 30 to 45 minutes a day there, equivalent to one sit-com television show.

Gwen Morrison, the Chicago-based executive who runs The Store, one of the world's leading retail think-tanks, told how she had set up her own shop - Magazine Gwen which sold products aimed at other travellers including luggage, iPods and GPS.

Brazil's giant shopping chain, Magazine Luiza, with 571 stores and 500,000 mobile phone visits a month, had extended its reach via social media and an arm, Magazine Voce (your store) on Facebook enabled shoppers to create individualised stores for friends to visit and buy items, earning 2.5 per cent to 4 per cent commission. Another innovation was a Japanese vending machine with face recognition software able to recommend products to its customers based on its interpretation of who they were, she said.

Burberry, the iconic British retail brand, had shifted its focus because of social media and Morrison quoted Christopher Bailey, its chief creative officer saying: "We are now as much a media content company as we are a design company because it is all part of the overall experience."

Changing rooms at some retail chains offered virtual technology enabling customers to view the product on themselves without trying it on, Morrison said, and TopShop hooked up customers with stylists to give direct advice about its products and how they can be used.

"We are navigating a world of change in retail," she said, pointing out that many different types of social media affect purchases.

"They do a lot of pre-shopping online before they set foot in a store so retailers are having to rethink their communications models," Morrison said.

Jon Bird, Ideaworks' chief executive, cited Amazon as a revolutionary shopping experience, providing parcel tracking and peer reviews, giving both a superior retail and distribution experience to its customers.

Some retailers had bucked traditional marketing methods, he said, citing Britain's Selfridges' Project Ocean "no more fish in the sea" activism campaign aimed at drawing customers by identifying with their pro-environmental values and beliefs, Bird said.

* Leading international retail experts:
* Ruby Anik, former senior vice-president of brand marketing, JC Penney.
* Gwen Morrison, CEO, the Americas and Australasia, The Store.
* Mike Lundgren, partner and director of innovation strategy, Kansas City-based VML.
* Jon Bird, chairman, Sydney-based, of Ideaworks, Augustus Terrace, Parnell, Auckland.