Malls are no longer the big ticket attraction they once were. As ecommerce accelerates, larger tenants are making way for smaller tenants trialing bricks and mortar experiences.
Throughout the decades, malls and shopping centres have played a critical role in supporting everything from mid market stores to large department stores and luxury retailers, giving them unrivalled exposure to their customers looking to spend time and ideally, money.
As both mid-market and large anchor retailers face considerable challenges in the wake of e-commerce and more recently COVID-19, malls are replacing incumbents with non-traditional tenants and in turn, redefining the purpose of a mall visit for consumers. There is now an accelerated need to seek out the next iteration of the mall experience, using in store technologies to provide new and varied options when shopping.
Enticing the new wave of retail
Mall locations in the US alone will shrink from 1200 to 900 in the next decade - it’s possible COVID-19 will accelerate this. Currently, malls are providing everything from temporary housing to hospitals, but inevitably they will look to reopen and will face an inflection point. The ones that thrive will emphasize safety (think contactless solutions and queue management) and will entice a new wave of desirable brands whilst recuperating the lingering costs of the pandemic.
To innovate for the new frontier, malls will need to invest in retail technologies like Foyer that create operational efficiencies for these new wave tenants - connected stores that provide omni channel fulfillment and drive a better customer experience and in turn, higher sales.
Pop-ups for local retailers, showcase stores for e-commerce businesses and experiential brand spaces, all which blend digital and physical, are once again demonstrating the value in tangibility and physical browsing in the customer journey.
And when tech companies like Amazon are expanding the customer experience to physical contactless stores, you can be sure there is considerable long-term investment behind the next evolution of the mall (even if it’s mall kiosks were largely abandoned).
‘Mall’ and ‘community’ still appear to play a role together, albeit reframed in a very different climate. Gone are the arcades and cinemas as development groups are constructing hybrid spaces for shopping and living, as well as temporary stays, hospitals, entertainment and offices.
So what will a successful mall look like?
- Diversified offering that blends retail with housing, healthcare and more and less reliance on anchor tenants like legacy department stores
- Look to new and emerging trends and industries like experiential showrooms and cannabis dispensaries
- Short-term leases with plug n play digital solutions that can surface online inventory and integrate with existing systems
- Invest in connected retail offerings for specific industries - digital storefronts like Digital Shopper for restaurants or Queue Managers for pharmaceutical
- Emphasise contactless solutions where possible across all touchpoints
Check out how Foyer helped Steiner & Associates attract e-commerce tenants by bringing their brands to life.