At Flame Analytics, we believe that sharing knowledge and industry expertise is essential to understanding the challenges and opportunities shaping the retail sector. Through our Flame Analytics Expert Interviews series, we bring together professionals who share their experience and perspectives on the evolution of shopping centres and the future of retail.
In this edition, we are pleased to feature Francesco Terra, Consumer Intelligence Lead at CBRE Investment Management. In this interview, Francesco shares his views on changing consumer behaviour, the role of technology and data analytics, the importance of visitor experience and the key trends that will shape shopping centres in the years ahead.
We would like to thank Francesco for sharing his valuable insights and contributing his expertise to the Flame Analytics community.
The Current Landscape of Shopping Centres
1. How would you describe the recent evolution of the shopping centre industry?
The evolution is slightly different from country to country within Europe. However, the shopping center industry is more broadly characterized by a distinction between developing new assets and extracting additional value from existing ones. In Spain, for example, the national council of shopping center (AECC) reports a strong pipeline of new developments supported by strong tenant sales, performance and footfall during the first half of 2026. In contrast, there are other mature markets like Italy, for example, showing more investments towards existing sets that have reached a visible maturity stage. Refurbishment, tenant-mix optimization and the introduction of new services are becoming important levers to strengthen competitiveness and protect long-term asset value. In general, retail is firmly back on the radar of investors with a transaction volume of €2.6 billion only in Italy during the first 9 months of 2026 as shared by CBRE Research showing confidence and appetite for the asset class.
2. What do you consider to be the most pressing challenges facing shopping centres in today’s environment?
The most pressing challenge for shopping centers is remaining relevant to consumers. The retail proposition is increasingly challenged by online shopping and new marketplaces supported by macro trends like the second-hand economy, the green transition and the ageing society. Moreover, the retail and leisure propositions of shopping centers are also challenged by emerging new trends, shifting consumer spending towards digital and entertainment experiences, including paid streaming and gaming services. In general, consumers have finite disposable incomes and the share of consumer spending allocated to shopping centers is at risk, if retail and leisure propositions do not innovate and continue to generate interest and appeal. Therefore, the challenge is not simply to compete with online retailers on convenience or price, but to offer compelling reasons for consumers to visit shopping centers in person. This requires combining an attractive retail mix with services, social experiences and leisure activities that create value beyond the transaction itself.
3. How has the role of shopping centres evolved in terms of visitors’ shopping, leisure and lifestyle habits?
Shopping centres are destinations that consumers visit for different reasons, extending beyond traditional shopping. While some visits remain functional and time-sensitive, others combine shopping with dining, leisure, entertainment and social interaction. This means that shopping centres must accommodate different needs and expectations, rather than adopting a one-size-fits-all approach.
Innovation and Technology in Shopping Centres
4. How do you think technology is transforming the visitor experience in shopping centres?
Consumers are more informed and increasingly adopt new technologies that help them to make rational decisions when visiting a shopping center, and generally when purchasing products and services. On the other hand, new technologies are also supporting the digital transformation of shopping centers, affecting the way the built environment interacts and communicates with end users The key to enhancing visitors experience in shopping centers is to use new technologies in a meaningful way that really impacts end users. These technologies can save resources, improve access to information and insights, or generate positive word of mouth and feedback on social media.
5. Which innovations or tools are currently shaping trends in shopping centre management and operations?
Shopping centre management is becoming increasingly data-driven and automated, while new technologies are significantly improving visitor satisfaction and operational efficiency. There are several innovative tools currently in use for the management of shopping centers. In my view, smart parking systems and digital building management systems are among those producing tangible results. Real-time sensor apps guide drivers to available parking spaces, reducing traffic congestion and the time required to find parking. Digital building management systems track power usage, water consumption, and carbon footprints, supporting the green transition. Therefore, the next step is to integrate these systems, enabling operators to monitor performance in real time and respond more quickly to changing conditions. The value of these technologies should be assessed not only through cost savings, but also through their contribution to service quality, resource efficiency and visitor satisfaction.
6. When it comes to data and analytics, which metrics and methodologies do you consider essential for improving decision-making and overall shopping centre performance?
It is essential to understand traffic beyond simple footfall figures, although this can be a complex exercise. There are three key metrics in my traffic analysis: 1) provenance or visitor origin, which shows the geographical area where most of the visits (at least 80%) to the shopping center originate, thus defining the so-called catchment area; 2) penetration, which shows the proportion of the population within the catchment area that visited the shopping centre at least once during the measurement period, thus defining the number of actual visitors; and 3) frequency, the average number of visits generated by each visitor within the catchment area. These three metrics should be analyzed together. Catchment area identifies the geographical market a shopping centre serves, penetration indicates how effectively it attracts the population within that market, and frequency helps assess the strength of its relationship with existing visitors. Their combined analysis can support decisions on marketing investment, tenant mix, competitive positioning and the identification of opportunities to attract new visitors or increase repeat visits. It is also important to distinguish unique visitors from total visits and to define the measurement period consistently. Finally, there are different methodologies in use to track these metrics, such as the analysis of mobile data, or the execution of traditional surveys using telephonic and face-to-face interviews. In my experience, some emerging research methods based on AI applications and synthetic data have not yet delivered sufficiently satisfactory results for these specific purposes. Their usefulness should be assessed against the quality, representativeness and practical reliability of the insights they produce.
Strategies for Success in Shopping Centres
7. What are the key factors that determine a shopping center’s success today?
In my opinion, successful shopping centers are those with a clear purpose and a well-defined market positioning. As consumers become increasingly informed and the competitive environment increasingly phygital, shopping centers will be selected according to their convenience and retail or leisure propositions. A shopping center with a strong convenience market positioning is usually grocery-centric, small, easy to navigate and time-saving, with a central location within a densely populated urban catchment. A dominant shopping centre typically large in size to accommodate a complete merchandising mix, including leisure activities and a tenant mix aligned with consumer demand. Moreover, dominant shopping centers have a wide, often drive-time catchment area, and typically perform strongly on key performance indicators like awareness, penetration and sales per visit.
In general, the key is to align the entire operating model with the chosen positioning. Location, accessibility, tenant mix, services, marketing and investment priorities should reinforce the same value proposition. Performance should therefore be assessed against the center’s strategic objectives and relevant competitors, rather than through a single set of indicators applied uniformly across all assets.
8. How can shopping centres enhance the visitors’ experience, build loyalty and strengthen their relationship with visitors?
In general, shopping centers must remain consistent with their market positioning and deliver what consumers expect from the visit to generate satisfaction and loyalty, reflected in repeat visits. Consumer expectations vary depending on the market positioning and dominant shopping centers naturally have more factors that influence satisfaction.
In recent years, some shopping centers introduced apps to enhance the visitor experience and build loyalty mainly through reward programs. However, the use of shopping centre apps has produced mixed results. For example, a recent census undertaken for Retail & Food magazine shows that only 11% of Italian shopping centers use apps to connect, communicate or reward visitors. A closer look at the results suggests that those who weren’t successful are mostly apps that simply replicate traditional loyalty cards. Digital engagement, like adopting apps, should solve visitor problems rather than simply reproduce a loyalty card on a smartphone. The effectiveness of digital engagement should be measured by the value it creates for visitors and the results it generates for the shopping centre. Relevant indicators may include active users, engagement with specific services, redemption of offers and changes in visit frequency. Ultimately, a digital solution is valuable when it removes friction, improves the experience or provides a clear reason to return.
9. What role do collaboration with retailers, service offerings and the creation of unique experiences play in a shopping center’s competitiveness?
Shopping centers are complex and interconnected ecosystems whose success depends on retailers' ability to generate sustainable sales and profits. Collaboration between landlords, property management, suppliers and retailers is a critical factor in creating a positive visit experience. The challenge is to align activities and operations with consumer expectations and in that context, research is essential to make informed decisions that affect all stakeholders. Sometimes, decisions are made without sufficiently considering consumer feedback. However, this approach rarely pays off in the long term, as it creates the risk of failing to meet consumer expectations and ultimately undermining the asset's competitiveness.
In conclusion, effective collaboration requires shared objectives, regular exchange of information and a common understanding of visitor needs. Insights into traffic patterns, shopping missions and consumer preferences can help landlords and retailers coordinate marketing initiatives, optimize the tenant mix and evaluate the performance of individual activities. Research therefore provides a common evidence base for decisions that affect the entire shopping center’s ecosystem.
Looking Ahead
10. How do you envision shopping centres evolving over the next five to ten years?
Shopping centers will become increasingly smart and sustainable acting as phygital platforms that connect consumers, retailers and services. Shopping itself will continue to be either a functional or a leisure activity while shopping centers will be polarized between convenience and dominant destinations. There will be additional adjustments in leasing agreements to extend data sharing on click-and-collect activities. Shopping centers and retailers will increasingly share information about events and promotions through digital channels. Services such as repair, reselling recycling will increasingly integrate into existing retail formats, responding to the growth of circular and second-hand consumption. Healthcare and well-being focused services already operating in some shopping centers will become increasingly relevant for ageing consumers. More broadly, shopping centers will continue to evolve in response to changing consumer behaviors and wider societal trends. However, an important implication is that shopping centre performance will inevitably depend on the ability to integrate physical infrastructure, retail activities and digital services into a single operating model. At the same time, this evolution will require appropriate data governance, clear responsibilities and respect for consumer privacy.
11. Which trends do you think will shape the future of these spaces and their relationship with consumers?
New technologies will increasingly impact how consumers shop using digital tools, social commerce, and AI-powered recommendations to make faster and better-informed decisions. Therefore, shopping centers that want to stay relevant to consumers must invest in digital tools to manage and influence the decision-making process. Moreover, migration and demographic change will contribute to an increasingly multiethnic society where understanding and responding to diversity will become an important factor in attracting visitors. Finally, the green transition is also a relevant trend shaping how consumers think and act on purchases. Studies such as PwC's Voice of the Consumer Survey indicate that consumers are willing to pay a premium of around 10% for eco-friendly or sustainable goods. These changes will make consumer understanding increasingly important. Shopping centres will need to recognize that visitors differ in their needs, motivations, digital behavior and expectations, and that these differences may influence how they discover, select and use retail and leisure destinations.