Malls outperform high streets on footfall as ethnic wear leads demand and premium stores drive better engagement, reveals Enalytix report
Tier 3 and Tier 4 cities are fast emerging as key retail growth hotspots in India, even as malls continue to outperform high-street formats on footfall, according to a latest FY2026 analysis by Enalytix, an AI-driven video analytics firm.
The report highlights a structural shift in India’s physical retail landscape, where growth is increasingly being driven not just by higher footfall but by improved quality of shopper engagement and conversion potential.
Mall-based retail continues to dominate in terms of scale, recording nearly 50 per cent higher footfall compared to high-street stores, with overall mall traffic rising around 15 per cent year-on-year. Weekend shopping remains a significant driver, with mall stores witnessing a 40 per cent surge in footfall, while high-street outlets see relatively moderate gains.
However, high-street formats retain an edge in shopper intent, recording around 10 per cent higher dwell time, suggesting more focused and purpose-driven visits.
Across city tiers, Tier 1 markets continue to lead with approximately 20 per cent year-on-year growth and 25 per cent higher footfall than Tier 2 cities. At the same time, Tier 3 and Tier 4 cities are steadily gaining traction, posting around 10 per cent growth while demonstrating stronger in-store engagement and higher conversion potential.
Consumer behaviour trends indicate that the 5 PM to 8 PM window remains the peak shopping period, accounting for nearly 46 per cent of daily footfall. Categories such as jewellery and electronics see the highest engagement levels, with significantly longer dwell times, while apparel continues to attract consistent browsing interest.
Within fashion, ethnic wear has emerged as the top-performing segment, driving nearly double the footfall compared to other categories. Fast fashion continues to benefit from repeat purchases, while the overall apparel category has recorded around 10 per cent growth year-on-year.
A notable divergence is visible between value and premium fashion segments. Premium stores report stronger engagement and higher dwell time, while value fashion brands face nearly double the abandonment rate, indicating challenges in converting store visits into purchases despite high traffic.
Commenting on the trends, Rajul Tandon, Founder and CEO of Enalytix, said retail growth is increasingly being defined by the quality of engagement rather than just scale. He added that while malls and Tier 1 cities continue to drive volume, emerging markets in Tier 3 and Tier 4 cities are becoming high-engagement ecosystems with strong conversion potential.
Store experience and staff interaction are also proving critical. Retail outlets where staff engage customers within the first two minutes of entry see higher dwell times and lower bounce rates, especially during peak evening hours.
Looking ahead, expansion strategies are aligning with regional demand patterns. Apparel and fast fashion brands are accelerating their presence in smaller cities, while sports and fitness formats are focusing on Tier 1 and Tier 2 markets. Increasingly, retailers are leveraging AI-led insights to optimise store formats, locations and in-store strategies.
