Shopping malls have developed a reputation as dying remnants of a long-gone era, and at first glance, many do seem filled with sad, empty spots. Department stores have shuttered while small shops struggle on. Other malls, however, have changed with the times and become vibrant centers for small retailers, restaurants and entertainment venues.
Change Is Constant
For several years, America's malls have been undergoing a sea change. While over 400 department stores closed in 2017 alone, malls are still a viable spot for small retailers, restaurants and movie theaters. That 400 number is depressing, but more stores opened than closed in 2017, according to a recent study by JLL Research. But the type of store that is opening is changing.
Increasingly, malls are becoming mixed use. People may not visit them for the traditional anchor stores, such as Sears, Macy's or J.C. Penney's, but instead they go to malls to see movies, shop at specialized retails chains and maybe grab a bite to eat. This eating is being done less and less, however, at the traditional food courts. Now it's not uncommon to find diners filling up a sit-down restaurant like California Pizza Kitchen or Cheesecake Factory, for example, in between stints of shopping.
Online Shopping vs. Mall Visits
While online shopping has definitely become more popular during the past decade, people still want to visit brick and mortar stores, according to a 2016 study by Pew Research. The study found that although 79 percent of Americans shop online, 65 percent of those online shoppers still prefer to visit actual stores, primarily because they want to try on an outfit in person and get opinions from their friends. So it stands to reason that having a brick and mortar store in a mall is good for retailers.
Advantages of Being in a Mall
- Lots of Customer Parking: It's always easier to park at a mall, which has ample parking, than at a trendy shopping spot in a city. Your customers won't arrive grumpy from having to search for a spot.
- Ample Foot Traffic: If you're in a mall that's bringing in new types of business, you're likely to get a lot of people wandering by your store every day.
- You're Part of an "Experience": One thing stores are doing to lure customers is making shopping more of an experience. A cosmetics store may have stations everywhere for customers to try out the latest products or buy tiny samples. Clothing stores are curating their displays, making a store visit akin to an artistic adventure. Even if your shop hasn't quite hit these heights yet, you are around other stores, restaurants and businesses that are helping create an overall experience.
- Variety of Customers: If you're in a mall, your shop is more likely to be discovered by customers who never would've traveled to your business if it was a standalone store.
- Beneficial to Have Nearby Competitors: This sounds counter intuitive. If you run a clothing store for women, you would think having another clothing store for women nearby would be unwelcome. However, customers like having choices and alternatives. People are more likely to make purchases in general if they have several options, and like heading to a destination that has a few options nearby so they can see them all on one trip. That's why you often see big box stores close to each other. They understand the theory that competition is good for all.
Malls Aren't Dying, They're Evolving
If you're a retailer considering leasing space in a mall, ensure it's one that is changing and updating itself with the times. Mall management should be open about how they plan to use vacant spaces, and you should see good activity within the building.