QuinxErin

25/01/2022

A shake-up of retail regulation is something to mall over
Why are retail sales in the doldrums, or headed online? To me, it’s in part because Australian shopping malls are bland, uninteresting containers of branded chain stores and the same old franchises offering shoppers a very limited choice of products, wherever they may go. There is no point crossing town to visit another mall when it’s the same as the one around the corner. No wonder the panoply of delights online is proving so tempting.

Why are our malls and stores so boring? Perhaps land use planning is part of the problem. The contrast between our retail environments and those of cities elsewhere is immediately apparent to anyone who travels broadly.

Planning, malls and monopolies
As noted by the Productivity Commission, retail planners in Australian state and local governments promote a hierarchy of “activity centres”. Their plans try to reinforce a dominant central business district (CBD), which is ringed by large suburban shopping malls, which in turn are ringed by smaller neighbourhood centres and supermarkets in surrounding suburbs. These plans accord with what is seen as the most efficient spatial arrangement if the market is left to its own devices.

The theories underpinning these plans derive from the work of German analyst Walter Christaller, who identified such hierarchical patterns in activity centres across southern Germany in the 1930s. Planners try to approve enough retail space to create competitive, vital retail environments.

Within this hierarchy, planners designate “key centres”, most of which are the largest suburban malls in the middle-ring and outer suburbs, owned and managed by the large mall operators. Clustering is encouraged to make it easier to provide infrastructure, including public transport. Out-of-centre developments are strongly discouraged, which is why, at the smaller scale of neighbourhood centres, Aldi has found it so hard to break in to the Coles/Woolworths duopoly.

The regulations hand a monopoly to existing mall owners. Existing malls can fight off new entrants in court to stop them coming near their patch. The run of mall expansions over the years have made these centres larger and larger, and the monopolies more entrenched.

For shopkeepers, the malls have the upper hand when it comes to negotiating leases. Rents are high and the stipulated conditions are tough. The malls have the only good store locations in key parts of the city and it’s difficult to prosper elsewhere. Small businesses find it too difficult to get in, ensuring the chain stores you find in malls are essentially the same all over the country. There is a startling lack of variety in such categories as men’s fashion. The possibilities of edgy new Australian brands emerging (the next Sass & Bide) are slim.

Regulating malls for competition and differentiation
By contrast, many Asian cities now plan activity centres for diversity, not for monopoly. At suburban Wu Jiao Chang in Shanghai, for example, there are four or five smaller shopping malls clustered together, stand-alone department stores, plus supporting restaurant strips and a “food mall” (which is very different!). Though the urban design is poor at times, the variety offered is no accident.

Each individual mall owner has a relatively low maximum floorspace they are allowed to own and operate. If other mall operators want to come in, they are encouraged - not discouraged - by the rules. The land designated within the activity centre area allows room for new malls to be built. But you can’t construct a mall elsewhere nearby, it must be in the centre, which is supported by two metro stations. As such, the adjacent malls compete fiercely with each other for tenants and in being as attractive as possible to customers.

There is a little over-capacity at Wu Jiao Chang, with cheaper rents in the upper floors. Small businesses are able to negotiate leases. All the main international and Chinese chain-stores are represented - and they dominate sales - but you find many stores with new designers and local start-ups. It makes for an interesting, varied shopping destination. Shopping is fun, in ways Australians only experience when abroad.

Alas, such proactive regulation was not even looked at by the Productivity Commission, which appears quite an oversight.

So don’t cheer if you hear that your local mall is expanding yet again. Think how much better it might be if a new mall opened next door instead.

It’s all a matter of better (and not more) regulation. If we get the settings right, we’ll get cheaper prices, more variety for customers and bring people back to the shops.

25/01/2022

Money can’t buy you happiness, but it can put it on lay-by
The fact that that money can’t buy you happiness is generally well accepted. Happiness, it appears, is more about meaning and satisfaction than the acquisition of more stuff.

But money isn’t all bad. It can feed your family and pay off your mortgage, so it has its upsides.

Reflecting this reality, research consistently demonstrates a non-linear relationship between money and happiness. It shows that those of us who earn too little are unhappy, but so are those of us who earn too much.

The most up-to-date figures on this relationship suggest that, in Australia, A$100,000 is the income “sweet spot” for maximising happiness.

So, money in moderation appears to promote the most happiness. Still, perhaps it’s not just how much money we have, but also how we value and spend it that matters for happiness.

The pursuit of happiness
It is now well accepted that materialism – the love of things – tends to have adverse consequences for well-being.

People who hold these values tend to be less happy, depressed and less satisfied with their lives. This fact is best remembered when sitting at the traffic lights in your Toyota Corolla next to a much younger person driving a rather swish looking Mercedes sports convertible.

Shutterstock
We also know that what people spend their money on is an important determinant of happiness. Money tends to reduce happiness when it is spent on more stuff for ourselves.

But money can bring happiness when we spend it on experiences rather than things, use the money to benefit others, and perhaps unsurprisingly, don’t waste it on insurance policies.

When we spend money in less materialistic ways, it may actually promote eudaimonia - a sense of well-being and the feeling of flourishing and excelling in life.

But is there any hope for those poor materialists? A recently published study suggests there may be.

Wanting vs. having
Marsha Richins of the University of Missouri examined whether buying things may actually promote happiness.

In three studies, consumers were asked about the emotions they experienced when contemplating an important purchase, while shopping for an important purchase, or when using the product after it was purchased.

After grouping the sample according to whether consumers reported either high or low levels of materialism, Richins found materialists experienced more positive emotion when contemplating a future purchase, and a decline in positive emotion after the purchase had occurred.

Money can often bring us happiness when it is spent on experiences rather than things. Shutterstock"
Richins also found that the experience of positive emotion when contemplating a new purchase was related to how transformative materialists thought the new purchase would be.

That is, whether they thought the product would make them more likeable, more attractive and closer to their friends. Whether it would mean that they would have more fun and enjoyment in life, and would they be more effective and efficient in their lives.

This experience of pre-purchase increases and post-purchase decreases in positive emotion was not evident for lesser materialists, who appear to be emotionally ambivalent about acquiring more stuff.

The findings of this research demonstrate that, for materialists, happiness lies in the anticipation, rather than the outcome of spending money on things.

Maximising return on investment

nateog/Flickr
How can we use this to improve our daily levels of happiness? Here are a few pearls of wisdom (well, at least, for the materialists among us):

1) Don’t rush into a purchase. Spend time contemplating how much of a better person the new product will make you first.

2) Buy lotto tickets a week before the draw. That’s seven days of happy expectation and probably the only return on investment you will ever receive!

3) Revive the lay-by. Putting something behind the counter and paying it off over time should maximise its happiness pay-offs.

4) Don’t buy now and pay later. It will not only contribute to the pain of debt, but will rob you of the joy of contemplating the purchase while you diligently save for it.

Can money buy happiness? Well, maybe it can.

If we don’t have too much of it, spend it on a good meal out or presents for our loved ones, and spend more time contemplating our purchases than shopping for them, we just may be able to maximise the happiness returns on our investments.

25/01/2022

Can Google kill the Gruen transfer in time for Christmas?
Christmas is fast approaching and there’s a (very big) chance you’ve got some last-minute shopping to do. You won’t be the only one, and with shopping centres packed to capacity, it’s easy to get lost, even in a shopping centre you’re quite familiar with.

But just as a GPS device can help bushwalkers to navigate the wilderness, indoor positioning systems (IPS) can help shoppers navigate the deliberate confusion caused by shopping centres – a manipulation strategy known as the Gruen transfer. How will it work? See the videos below.

A recent post on the official Google blog announced the addition of indoor mapping to Google Maps for selected stores in the US and Japan. The feature is initially only available in Google Maps 6.0 on the Android mobile operating system, but other systems are sure to be included sooner or later.

Google is not alone in their endeavours. Communications multinational Nokia is also developing its own IPS and Scottish start-up, Sensewhere, is also trying its hand.

Traditionally, indoor positioning and navigation has been very challenging technologically because GPS cannot be used reliably indoors, if at all. Therefore, alternative technologies for indoor navigation have to be used.

These technologies can be classified into three categories:

Technologies based on pre-deployed signal transmission infrastructure, such as systems using infra-red or ultrasonic signals, ultra-wide-band or other similar systems.
Technologies based on “signals-of-opportunity” – that is, radio-frequency signals not intended for positioning, including WiFi, digital television, mobile telephony and FM radio.
Technologies not based on signals, including inertial navigation systems (INS) (using inbuilt accelerometers and gyroscopes), vision/camera systems, and others.
Deploying new IPS infrastructure is normally costly, but can lead to accurate positioning results – within one metre. A good example is Nokia’s Bluetooth indoor positioning system. To use this system, new antenna arrays will have to be installed throughout buildings such as shopping centres.

The antenna arrays are then used to measure the angle of arrival of signals transmitted by the Bluetooth-enabled mobile device. At that point, triangulation can be applied to calculate the location of the mobile device in 2D (or 3D in the case of multi-story shopping centres).

Since standard Bluetooth cannot be used as an IPS – it is too slow, for one thing – a new Bluetooth protocol was required and developed by Nokia. Nokia claims the positioning accuracy is about 30 centimetres, which is very good for indoor applications.

But the cost of this indoor positioning system is not clear, despite Nokia’s claims the system could be cheap. There is no doubt this system has its uses, as do ultra-wide-band, infrared and ultrasonic systems. But there’s still a long way to go before Nokia’s system finds its way into the marketplace.

Another option is to harness the radio-frequency signals around us which are used for other purposes. One of the most promising examples is WiFi – it is already widely used (in homes and public places) and available at very low cost. With a growing number of WiFi-enabled mobile devices in circulation as well, WiFi-based positioning systems make a whole lot of sense.

Unsurprisingly, Google and Apple are the biggest players in this field. You might remember the first generation of iPhone which was unveiled by Steve Jobs in 2007.

There was no GPS in the original iPhone; instead, localisation was based on WiFi, supported by a company called Skyhook.

WiFi was not originally designed for positioning, and the only useful information that can be measured is the strength of the wireless signal reaching the device. The techniques used for WiFi positioning are called “trilateration” and “fingerprinting”.

Trilateration requires the coordinates of access points and the distances between the user and the access points, based on the signal strength. Creating a nice signal-strength-to-range model is difficult and the model varies depending on the environment.

The basis of fingerprinting is to build a database containing signal strength measurements at a range of reference points. The location of the user can then be identified by comparing signal strength to data in the database. An accuracy of several metres can be expected.

The fingerprinting approach has been accepted as an effective method for indoor positioning, despite two major problems: the creation and maintenance of the database. Mapping signal strength is not trivial, not least because signals can be affected by simply moving furniture. This, in turn, decreases positioning accuracy.

That said, if access points are densely deployed, signal strength accuracy would not be too bad. In the worst scenario, a simple cell ID algorithm can use the location of the connected access point as a proxy for the user’s location.

When a WiFi device creates a connection to a WiFi access point, normally the signal strength received from that access point is the strongest one and the device must be close to that access point. Then the access point’s location can be used as the approximate location of the user.

This technique can also be used to map the signal strength of mobile telephony or FM radio signals. In these cases, the sparse transmitters make positioning results less accurate but a combination of systems can improve performance.

Several other technologies have the potential to make indoor positioning as easy as GPS outdoors and researchers are working hard to overcome the shortcomings of these technologies. Inertial navigation systems (INS) are self-contained – they calculate position using in-built gyroscopes and accelerometers – but the accumulation of errors is a killer problem.

Vision positioning systems require intensive calculation and a huge database of landmarks, but superfast internet connections and cloud computing might make this technology attractive in the near future.

At the moment, there is no single winner in indoor positioning given the intrinsic complexity of the indoor environment. New technologies are always being developed but to achieve ubiquitous positioning and navigation, integration of old and new technologies seems the most likely outcome.

Sadly, it could still be a while before we see indoor positioning on mobile devices in Australia. But it’s good to know developments are underway. If you get lost at a shopping centre in the meantime, you might just need to look for the nearest information desk – or get some apologies ready for your disappointed family members.

25/01/2022

25/01/2022