February 27, 2007
Consumers Staying Out Late at the Mall
Malls are looking to keep time with their standalone competitors by opening earlier and closing later.
Last month, General Growth Properties made a decision to expand its hours at 200 of its malls in 44 states across the U.S. The company is looking to draw extra shoppers on weekends by opening malls earlier and keeping them operating later, as well.
“Shoppers have gotten used to shopping whenever they’re available and whenever it’s convenient to them,” Lisa Bisenius, group vice president of marketing for General Growth Properties, told The Baltimore Sun. “They are more time-strapped and overcommitted in a number of ways and they need to have our flexibility.”
General Growth decided to make the change after two-thirds of consumers who responded to a survey said they would like the mall to expand its hours of operations. The company’s malls had always had extended hours during holiday shopping season but expanded it into the New Year.
Britt of Beemer, founder of America’s Research Group, said, “I’m sure they’ll do business but the question is how much more business they’ll do. It’s going to make them feel good, and they’ll be able to tell Wall Street this is what we have to do to go up against Wal-Mart. But until they get the merchandising right, consumers don’t care when you open.”
Howard Davidowitz, chairman of Davidowitz & Associates, sees value in the strategy. “I think when you’re losing market share you have to try to do new things,” he said.
Patrice Duker, a spokesperson for the International Council of Shopping Centers, said other malls will likely follow General Growth if it turns out to have positive results over a longer period of time. General Growth only began expanding mall hours last month.
“I think you need that year or length of time to benchmark it before we make the decision of whether it’s good, bad or indifferent,” said Ms. Duker.
Jen Tollick, a manager at Kokopelli boutique at The Mall in Columbia, said business has picked up with the expanded evening hours. “We’ve definitely done better during the evening hours,” she said.
Ouida Freeman is one consumer who is happy malls are staying open later.
“As a working adult I like to come at night, and this is good for me because it gives me more time to shop,” she said.
Discussion Questions: Will longer hours of operation make malls a more attractive shopping destination? Will the longer hours draw consumers who are primarily mall shoppers already or will it also start to bring in those who shop at standalone locations?
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I agree that behavior does not always follow the expressed desires of consumers. Differentiation is key here and the mall model is outdated and pretty irrelevant. While trying new things is certainly admirable, I’m not sure longer hours will accomplish much in the long run.
I hope GGP has increased its security. My pessimism suggests that these extended hours will attract shoppers that gave rise to the Loss Prevention Officer. Perhaps I’ll be pleasantly surprised….
When a supermarket is open 24 hours, the economics work because employees are cross-trained to be stockers as well as cashiers. They can be productive even when no customers are present. Small mall specialty stores often don’t have that flexibility. When there aren’t any customers, the staff can be reduced to socializing with each other or staring into space.
During an energy crisis years ago, certain malls cut their hours. Maybe some malls should open at 11 AM or noon weekdays if they’re going to stay open later in the evening. How profitable can the AM weekday hours be for the tenants?
On the surface, it sounds like a good idea but unless the mall can sustain enough traffic to give it an aura of being busy, it could actually wind up having an opposite effect. Nothing will turn people off faster than if they believe they are the only ones in a mall which for many people can give them a feeling of being unsafe. If this occurs, then the change can be a big negative.
Increasing hours is not the way to compete with stand-alone stores and the internet. It is not about being open at 2am, it is about having better, more interesting and more unique products and services plus more local stores, and a significantly better atmosphere. The Mall as we know it is becoming irrelevant…it is not quick enough, it is not fun enough, it is not visually interesting and it is not interesting merchandising wise. If interested in this subject and you haven’t read Paco Underhill’s “The Call of the Mall,” now is the time. Paco saw many years ago what the Mall owners are still refusing to believe…the model created in the 60s just does not work any more, and little cosmetic adjustments like increasing hours are just that…cosmetic, meaningless adjustments.
I applaud General Growth for asking their customers what hours they would like to see. Too many times, policy is made without asking the core constituents. However, having additional hours does not mean additional profits; just because a consumer appreciates the opportunity to shop later, doesn’t mean their behavior will match. The largest expense after rent is payroll. Retailers will struggle with the additional expense….
I am not sure if a traditional mall can compete head to head with a destination retailer that offers grocery and personal items. I am not sure they want to. Customers shop at malls for differentiation. Just because the hours are expanded does not mean they will shop more or spend more.
I agree with the other respondent that stated her pessimism lead her to believe that Loss Prevention may be the biggest gain here. Malls that traditionally have stayed open later struggle to maintain the safety of the property. I think General Growth will have to evaluate this decision closely to see if it is truly a profitable decision.
Freestanding stores and anchors of strip malls and power centers figured out a long time ago that the customer values convenience. My neighborhood Target store is open 97 hours a week during a non-holiday shopping period. It’s not just about opening later, but also about opening earlier to catch the shopper on her way to work or even the shopper at the end of an overnight shift.
For this tactic to work effectively for malls, a few things need to happen:
1. Open earlier and stay open later.
2. Make sure both the anchor tenants and other mall tenants are “on the same page” with respect to these hours.
3. Don’t starve staffing during the extended hours for the sake of productivity or it won’t resonate with customers.
4. Publicize the move as a convenience to consumers.
Mall anchors seem to be regaining some traction, and this move might help some specialty apparel tenants improve their trend too…assuming that they have the merchandise content in place.
I can’t imagine that longer mall hours will equate to anything other than the same number of customers spread out over more time. Dittos on the comments regarding safety concerns, particularly as enclosed malls are being replaced by outdoor lifestyle centers. Many of these venues, even when technically “busy,” look like giant labyrinths with a few ants crawling about. When night falls? Even scarier.
I am a Store Manager at a General Growth Properties Mall. My company has chosen not to comply with the new mall hours. The one Saturday morning my store was open we did $4 in business in the first two hours. I also don’t think the spring season is the time to implement this hours strategy; the fall season would have been better, going into the holiday season. More retailers would have supported it. Now, other stores in the mall are also quietly closing their doors early.
With the resurgence and popularity of malls, mall operators have to take measures to remain competitive with retailers such as Target. In the long run, they may find that changing the hours hasn’t brought the benefits they’re hoping for. However, in the mean time, they’re at least trying to accommodate their customers. Time will tell, but right now I believe they’re doing the right thing.
Will longer hours be the answer malls are looking for? Not really…although asking customers what they want and trying to respond is a good sign. There may be some marginal pick up of business in the evening hours but staffing costs during quiet morning hours plus issues about security when few people are about could largely offset that benefit. Unless other factors also change, revenues will just get spread out over a longer day. To be an attractive shopping destination, malls have to compete against “stand-alone” alternatives and offer services, products and a shopping experience that consumers really value. For mall owners, this is back to marketing and retailing basics: i.e. how best to position their venue in the minds of potential shoppers, identifying a unique point of difference they can leverage in their advertising and PR efforts, attracting tenants (national & local) that deliver on and extend their positioning, investing in facilities “make overs” that enhance the mall shopping experience for consumers and reinforce their competitive stance. Some malls have shown ingenuity by offering an experience that stand-alone retailers can’t: examples are “destination” malls that offer attractions or services beyond normal retail. Whatever the answer, longer hours is only part of the puzzle.
My experience has shown me that just because a group says that they want something doesn’t mean that they’ll necessarily do it. It will be interesting to see what kind of traffic this new extended hours policy actually secures. And, as Adrian mentions, what kind of clientele and actual sales it generates.
Mike hits the nail on the head with his response above. The pain points with these groups is not hours…it’s about creating more attractive destinations. There are so many interesting, strategic things that mall owners could be doing to take their properties to the next level. The technology as well as the trends are there just beckoning for someone to do something with them! Instead, we see some of the giants using new tools to blast ads at the shopper and sell space for “eyeball value” rather than finding breakthrough methods to serve and delight the pedestrian traffic. This is just crazy because it’s actually detracting from the mall experience, worsening the problem at hand.
I’m sure that someone will “get it” and create a model that raises the bar in the near future. When they do, I’m thinking that the hours won’t be an issue because folks will do what’s required to simply be there.
Is the mall competing with supercenter stores? If so, then hours of operation are important. If the consumers who frequent supercenter stores are not mall consumers, then why open longer? Opening for more hours in itself doesn’t really solve a problem. Do consumers want to go to your mall? Why aren’t they? If the number one reason is hours of operation then longer hours will resolve the issue. If longer hours of operation is one of several reasons and the rest of the reasons are not addressed, longer hours will not resolve the issue.
I recently made the mistake go going to a shopping mall at 9AM thinking it would be open. Wrong. It didn’t open until 10AM. I didn’t go back and don’t plan to. Another time, I went because I saw people walking in at 7AM. None of the stores were open but it was like “Dawn of the Dead” watching all these people doing their “mall walking.” I don’t think they need to be open by 7AM but at least open by 9AM.
For many regional malls in small markets, extending hours would only worsen an already difficult circumstance for both retailers and mall ownership.
Each hour that the mall is open adds to the operating costs (heating, cooling, lighting, housekeeping, security) that are passed through to tenants via CAM charges–which are already driving tenants away from some enclosed centers.
Small specialty shops have minimal staff allocations, which will be stressed even further if they need to cover more hours. Customer service, already scarce, will disappear. Loss prevention issues will increase as a result.
In many markets, downtown shopping districts and strip centers continue to lure retailers from malls with their lower or non-existent CAM costs, and lack of mandated business hours.
Shoppers want malls to have longer hours, a more secure environment, more local and diverse retailers and lower prices. Unless something in the equation gives (perhaps later opening times on weekdays, or restricting late night hours to one or two days a week) this math won’t work.
On the surface, it appears to be a good move. But one must look deeper. Perhaps mall traffic is off because generally mall stores have less customer service and a lesser customer experience that stand-alone stores. Perhaps they are off because of a over-saturation of the stores that generally are found in a mall.
My main concern about malls being open later is whether or not there will be sufficient staffing of the stores, enough security both inside the mall and in the parking lots and if enough people will be in the malls.
Will longer hours generate more business? Only time will tell. I would want to closely analyze the convenience and service that exists with these additional hours. Will associates really be there to answer customer questions and check them out quickly, or will they be so scarce that there is no one to talk to and only one register located in the far corner of the store, next to a security guard?
I would hope that some of the restaurants and eateries in their shopping centers would also extend their hours, at least for a test, so the shopping center doesn’t look like a ghost town with only a few shops open. I never like the feeling I get when I arrive at an airport at 10PM and everything is closed or being cleaned by staffers.
I applaud them for trying new hours, but I tend to think that opening earlier, say between 7 and 9AM might attract an equal number of customers who are looking for added convenience.
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I agree that behavior does not always follow the expressed desires of consumers. Differentiation is key here and the mall model is outdated and pretty irrelevant. While trying new things is certainly admirable, I’m not sure longer hours will accomplish much in the long run.
I hope GGP has increased its security. My pessimism suggests that these extended hours will attract shoppers that gave rise to the Loss Prevention Officer. Perhaps I’ll be pleasantly surprised….
When a supermarket is open 24 hours, the economics work because employees are cross-trained to be stockers as well as cashiers. They can be productive even when no customers are present. Small mall specialty stores often don’t have that flexibility. When there aren’t any customers, the staff can be reduced to socializing with each other or staring into space.
During an energy crisis years ago, certain malls cut their hours. Maybe some malls should open at 11 AM or noon weekdays if they’re going to stay open later in the evening. How profitable can the AM weekday hours be for the tenants?
On the surface, it sounds like a good idea but unless the mall can sustain enough traffic to give it an aura of being busy, it could actually wind up having an opposite effect. Nothing will turn people off faster than if they believe they are the only ones in a mall which for many people can give them a feeling of being unsafe. If this occurs, then the change can be a big negative.
Increasing hours is not the way to compete with stand-alone stores and the internet. It is not about being open at 2am, it is about having better, more interesting and more unique products and services plus more local stores, and a significantly better atmosphere. The Mall as we know it is becoming irrelevant…it is not quick enough, it is not fun enough, it is not visually interesting and it is not interesting merchandising wise. If interested in this subject and you haven’t read Paco Underhill’s “The Call of the Mall,” now is the time. Paco saw many years ago what the Mall owners are still refusing to believe…the model created in the 60s just does not work any more, and little cosmetic adjustments like increasing hours are just that…cosmetic, meaningless adjustments.
I applaud General Growth for asking their customers what hours they would like to see. Too many times, policy is made without asking the core constituents. However, having additional hours does not mean additional profits; just because a consumer appreciates the opportunity to shop later, doesn’t mean their behavior will match. The largest expense after rent is payroll. Retailers will struggle with the additional expense….
I am not sure if a traditional mall can compete head to head with a destination retailer that offers grocery and personal items. I am not sure they want to. Customers shop at malls for differentiation. Just because the hours are expanded does not mean they will shop more or spend more.
I agree with the other respondent that stated her pessimism lead her to believe that Loss Prevention may be the biggest gain here. Malls that traditionally have stayed open later struggle to maintain the safety of the property. I think General Growth will have to evaluate this decision closely to see if it is truly a profitable decision.
Freestanding stores and anchors of strip malls and power centers figured out a long time ago that the customer values convenience. My neighborhood Target store is open 97 hours a week during a non-holiday shopping period. It’s not just about opening later, but also about opening earlier to catch the shopper on her way to work or even the shopper at the end of an overnight shift.
For this tactic to work effectively for malls, a few things need to happen:
1. Open earlier and stay open later.
2. Make sure both the anchor tenants and other mall tenants are “on the same page” with respect to these hours.
3. Don’t starve staffing during the extended hours for the sake of productivity or it won’t resonate with customers.
4. Publicize the move as a convenience to consumers.
Mall anchors seem to be regaining some traction, and this move might help some specialty apparel tenants improve their trend too…assuming that they have the merchandise content in place.
I can’t imagine that longer mall hours will equate to anything other than the same number of customers spread out over more time. Dittos on the comments regarding safety concerns, particularly as enclosed malls are being replaced by outdoor lifestyle centers. Many of these venues, even when technically “busy,” look like giant labyrinths with a few ants crawling about. When night falls? Even scarier.
I am a Store Manager at a General Growth Properties Mall. My company has chosen not to comply with the new mall hours. The one Saturday morning my store was open we did $4 in business in the first two hours. I also don’t think the spring season is the time to implement this hours strategy; the fall season would have been better, going into the holiday season. More retailers would have supported it. Now, other stores in the mall are also quietly closing their doors early.
With the resurgence and popularity of malls, mall operators have to take measures to remain competitive with retailers such as Target. In the long run, they may find that changing the hours hasn’t brought the benefits they’re hoping for. However, in the mean time, they’re at least trying to accommodate their customers. Time will tell, but right now I believe they’re doing the right thing.
Will longer hours be the answer malls are looking for? Not really…although asking customers what they want and trying to respond is a good sign. There may be some marginal pick up of business in the evening hours but staffing costs during quiet morning hours plus issues about security when few people are about could largely offset that benefit. Unless other factors also change, revenues will just get spread out over a longer day. To be an attractive shopping destination, malls have to compete against “stand-alone” alternatives and offer services, products and a shopping experience that consumers really value. For mall owners, this is back to marketing and retailing basics: i.e. how best to position their venue in the minds of potential shoppers, identifying a unique point of difference they can leverage in their advertising and PR efforts, attracting tenants (national & local) that deliver on and extend their positioning, investing in facilities “make overs” that enhance the mall shopping experience for consumers and reinforce their competitive stance. Some malls have shown ingenuity by offering an experience that stand-alone retailers can’t: examples are “destination” malls that offer attractions or services beyond normal retail. Whatever the answer, longer hours is only part of the puzzle.
My experience has shown me that just because a group says that they want something doesn’t mean that they’ll necessarily do it. It will be interesting to see what kind of traffic this new extended hours policy actually secures. And, as Adrian mentions, what kind of clientele and actual sales it generates.
Mike hits the nail on the head with his response above. The pain points with these groups is not hours…it’s about creating more attractive destinations. There are so many interesting, strategic things that mall owners could be doing to take their properties to the next level. The technology as well as the trends are there just beckoning for someone to do something with them! Instead, we see some of the giants using new tools to blast ads at the shopper and sell space for “eyeball value” rather than finding breakthrough methods to serve and delight the pedestrian traffic. This is just crazy because it’s actually detracting from the mall experience, worsening the problem at hand.
I’m sure that someone will “get it” and create a model that raises the bar in the near future. When they do, I’m thinking that the hours won’t be an issue because folks will do what’s required to simply be there.
Is the mall competing with supercenter stores? If so, then hours of operation are important. If the consumers who frequent supercenter stores are not mall consumers, then why open longer? Opening for more hours in itself doesn’t really solve a problem. Do consumers want to go to your mall? Why aren’t they? If the number one reason is hours of operation then longer hours will resolve the issue. If longer hours of operation is one of several reasons and the rest of the reasons are not addressed, longer hours will not resolve the issue.
I recently made the mistake go going to a shopping mall at 9AM thinking it would be open. Wrong. It didn’t open until 10AM. I didn’t go back and don’t plan to. Another time, I went because I saw people walking in at 7AM. None of the stores were open but it was like “Dawn of the Dead” watching all these people doing their “mall walking.” I don’t think they need to be open by 7AM but at least open by 9AM.
For many regional malls in small markets, extending hours would only worsen an already difficult circumstance for both retailers and mall ownership.
Each hour that the mall is open adds to the operating costs (heating, cooling, lighting, housekeeping, security) that are passed through to tenants via CAM charges–which are already driving tenants away from some enclosed centers.
Small specialty shops have minimal staff allocations, which will be stressed even further if they need to cover more hours. Customer service, already scarce, will disappear. Loss prevention issues will increase as a result.
In many markets, downtown shopping districts and strip centers continue to lure retailers from malls with their lower or non-existent CAM costs, and lack of mandated business hours.
Shoppers want malls to have longer hours, a more secure environment, more local and diverse retailers and lower prices. Unless something in the equation gives (perhaps later opening times on weekdays, or restricting late night hours to one or two days a week) this math won’t work.
On the surface, it appears to be a good move. But one must look deeper. Perhaps mall traffic is off because generally mall stores have less customer service and a lesser customer experience that stand-alone stores. Perhaps they are off because of a over-saturation of the stores that generally are found in a mall.
My main concern about malls being open later is whether or not there will be sufficient staffing of the stores, enough security both inside the mall and in the parking lots and if enough people will be in the malls.
Will longer hours generate more business? Only time will tell. I would want to closely analyze the convenience and service that exists with these additional hours. Will associates really be there to answer customer questions and check them out quickly, or will they be so scarce that there is no one to talk to and only one register located in the far corner of the store, next to a security guard?
I would hope that some of the restaurants and eateries in their shopping centers would also extend their hours, at least for a test, so the shopping center doesn’t look like a ghost town with only a few shops open. I never like the feeling I get when I arrive at an airport at 10PM and everything is closed or being cleaned by staffers.
I applaud them for trying new hours, but I tend to think that opening earlier, say between 7 and 9AM might attract an equal number of customers who are looking for added convenience.