2017 New Year Message - The Convergence of Online and Offline; expect the unexpected; or the new normal?
Being innovative to rise above the age of constant disruption. Mr Lim Ming Yan, CapitaLand’s President & Group CEO shares how building real estate of the future goes beyond technology – it’s about people too.
Issue: Jan 2017
Setting sights on the future – Building The Future CapitaLand: Mr Lim Ming Yan, President & Group CEO, CapitaLand Limited at the launch of lyf residences, a new brand under The Ascott Limited that is designed for and managed by millennials, to seize opportunities in the rising trends of coliving and coworking.
Happy New Year to all of you!
2016 was a year of many unexpected moments – from the Brexit vote to fanatical terrorist attacks and the results of the US elections. So unexpected were these events that Merriam-Webster picked 'Surreal' as 2016 Word of the Year. Every time a major unexpected event took place, the financial markets went into volatile gyrations, causing high levels of uncertainty.
Despite these “surprises”, we have done well with a very credible performance – thanks to our transformation over the past four years into a more resilient CapitaLand. For the year, besides strengthened operating PATMI and balance sheet, we achieved stellar residential sales; added a record of more than 10,000 serviced residence units to our portfolio; and achieved significant progress for many projects under development.
Looking ahead, the future will be no less challenging than 2016. Advances in technology and the development of the new economy are inevitable. With constant disruptions and a growing millennial market segment, how do we keep ourselves relevant or ‘desirable’ to our customers? How do we make sure that these customers will visit our properties more often and consume more when they are with us?
The Future – convergence of online and offline
CapitaLand touches the lives of millions of people through our network of over 500 properties across more than 130 cities in over 20 countries. In 2016, we took important steps towards our vision to create real estate of the future where customers can have convenience, value and a seamless experience between online and offline. We launched C31 Ventures to invest in new-economy startups relevant to our businesses; created the new brand lyf to tap into the millennial market; and started the redevelopment of Funan and Golden Shoe Car Park to provide for live, work and play of the future.
New-generation integrated development - The new Funan will house a mall of the future serving as a platform to inspire retail innovation; coworking spaces for the mobile workforce, freelancers and startups; and coliving apartments for hip, young professionals. With community, connectivity and convenience at its core, Funan will cater to the new breed of consumers who favour a collaborative environment and authentic experiences that reflect their passions and tastes.
In our malls, we leverage digital technology to improve our customers’ experience. CapitaStar, for example, is a good channel for us to gather shopper insights which we share with our retailers to help them engage shoppers and to increase their sales. In 2016, we enhanced CapitaStar as a conversational commerce platform with the pilot of Sparkle artificial intelligence chatbot that connects you with the products and services you want. Partnering new economy companies Grab and Chope, Sparkle has also extended its use beyond malls to include other lifestyle choices that are part of a shopper’s journey.
No longer just a data collection channel – CapitaStar is set to be a conversational commerce platform with the pilot of Sparkle chatbot, an artificial intelligence-powered concierge that connects you with the products and services you want.
Ascott has also expanded its collaboration with Tujia with the launch of the Somerset Tujia brand and forged a new partnership with Fliggy, formerly known as Alitrip. Our products and services are now accessible to hundreds of millions of Chinese travellers. Case in point on the reach of these new economy players, our sales during the recent Singles’ Day (11.11) went up six times through Fliggy, our highest number of room nights booked online in a single day in China.
For the future of the work place, we started working with Collective Works in Singapore, UrWork in China and Toong in Vietnam.
Instead of perceiving disrupters as threats, we leverage on them. These startups can provide innovative solutions to us in the areas of energy, operations and maintenance; building and construction; design and building materials; real estate funding as well as customer engagement.
What is clear from these initiatives to curate the right product and experience for our customers is that we must also evolve as an organisation.
Firstly, we cannot be a passive landlord. We need to constantly think about better ways for our retailers to sell, greater convenience for users of our properties and better engagement with both our customers as well as retailers. We must be prepared to make adjustments to our organisation and processes from the customer's perspective.
Secondly, we need to be highly adaptable, innovative and agile. To this end, we have simplified our organisation and are investing in our centres of innovation, ERP system as well as data analytics capability. One of the key objectives of these investments is to enable our key managers at the frontline to make better decisions driven by customer insights from data that we can share across our operational platforms.
The convergence of online and offline has brought about many possibilities, but real estate will remain relevant as physical spaces for social interactions. While technology will be crucial in real estate of the future, this change that we are experiencing is about people rather than technology. It is how we can use technology to strengthen our organisation, and how we equip ourselves with the right skills to be relevant in the current landscape. Ultimately, it is to improve the lives of people and to build the communities. Our credo of “Building People. Building Communities.” has become even more relevant as we embark on this journey.
Thank you for all the support and hard work in setting the stage for greater things to come in 2017. We are set to open eight malls including three Raffles City projects next year with a record 1 million square metres of gross floor area; and set to continue Ascott’s expansion momentum to hit its 80,000 unit target, entering more geographies including frontier markets. At the same time, Vietnam is going to play an increasingly important role in our portfolio. Working with capital partners through our Investment Management arm will also be an area of focus as we build larger scale, more capital intensive projects.
The journey ahead is an exciting one, with endless possibilities as we become more innovative and creative to rise above this era of constant disruption. I hope to have your continued commitment and passion in realising our vision of building real estate of the future.
Here’s wishing you a Happy New Year and a great 2017 ahead!