SM Retail, a core unit of SM Investments Corporation, reported the revival of consumer spending in its stores following the resurgence of foot traffic in SM Malls which sales already exceeded pre-pandemic levels.
In a statement, SM Retail said the strong performance of retail in the first six months of 2022 shows the resilience of consumption in the Philippines despite economic headwinds.
Operating over 3,300 stores, SM Retail reported a rise in revenues by 18 percent to P163.7 billion in the first half of 2022, buoyed by the return of crowds in physical stores and malls.
SM Retail’s net income jumped by 91 percent to P7.0 billion, benefitting from efficiencies across all retail formats.
The SM Store Executive Vice President for Operations and Sales Support Dhinno S. Tiu said the Filipino consumer today is evolving but still focused on value shopping especially magnified by the pandemic.
While consumers are also getting more comfortable with technology as the pandemic pushed digital alternatives in consideration of safety, he said retail spaces, particularly malls, will always be the go-to community spaces in the Philippines for Filipino shoppers.
Beyond the purchase of life’s necessities, malls have evolved into a hub that serves as the modern-day plaza center for communities all over.
“As the new day social platform, the malls are a place of convergence, dining and shopping, where people can mingle and relax. Despite ecommerce, brick and mortar spaces will always have a compelling value and relevance for the Filipino shopper,” Tiu said.
While the business of shopping malls elsewhere around the world, especially in Western countries, were affected when COVID-19 struck, shopping and even “malling” in the Philippines have become an integral part of the everyday Filipino lifestyle.
Crowds have returned to Philippine malls, with SM malls’ foot traffic increasing by more than 100 percent over pre-pandemic levels year-to-date.
Renewed economic activity is spurring a revival in livelihood which, in turn, is driving rising incomes across the country. Cash remittances from overseas Filipino workers also hit new highs in July 2022, up 2.3%, providing more fuel for spending.
With added resources, Filipinos are returning to shopping, especially in fashion items with vigor. Many also treat shopping as therapy and entertainment. “People will always go shopping to feel good about everything that is going on,” Tiu said.
SM continues to listen, adapt and innovate to the ever-changing needs of Filipino consumers. When the pandemic struck, SM made it a point to connect with the customer conveniently and innovatively.
Call to Deliver, The SM Store’s hybrid and safe shopping service available through #143SM, Facebook Messenger and Viber, allowed customers to chat with personal shoppers and have their items delivered at their doorstep or picked up in-store.
“The introduction of our personal shopper channel (Call to Deliver) enabled us to continue serving our customers during the peak of the pandemic. We were the ones who went and reached out to our customers, offering the convenience of same and next day delivery and personalized service,” Tiu said.
He added that SM will continue building on its strengths to be relevant to its evolving customers. As SM welcomes more people back into its stores and malls, it is working to introduce more experiences, especially to the younger generation with more ‘Instagram-worthy’ areas to go along with its diverse and complete offerings.
“We continue to adapt to our customers’ modern needs and endeavor to provide them with new, safe, and enjoyable shopping experiences,” Tiu said.