March 1, 2012
Downtown Retail Takes on the Malls
Recent evidence indicates shoppers are migrating from bricks and mortar to clicks. But when shoppers want real stores with real products they can touch and feel, where do they want them to be? Debate is raging.
Laura Brown of Insight with Passion told RetailWire about a series of clinics aimed at giving retailers and local businesses a strategy to revive their towns by revitalizing the customer experience to “increase footfall and profits.” Discussions between stakeholders evolve from social networking comments and mystery shopper research.
Several British papers reported on a fund launched by U.K. government adviser Mary Portas for towns with innovative suggestions on improving their centers. Also cited are Majestic Wine chairman Phil Wrigley who has declared high streets “irrelevant” and Sainsbury CEO Justin King’s belief that responsibility for empty town centers lies with retailers who didn’t adapt to changing demands.
“We must be brave enough to shrink the high street and allow empty shops to be converted for other uses,” Mr. King suggested, specifying housing and education.
As reported by the Daily Mirror, big chains (defined in the U.K. as those with six or more stores) closed more in 2011 than they opened for the first time since 2008, according to a study of the 500 biggest town centers in the U.K. by PriceWaterhouseCoopers and Local Data Company.
In the U.S., it is malls that are struggling. Stephanie Clifford writes in The New York Times that “many malls across the country” are taking drastic steps to make empty space more enticing. Cleveland’s Galleria contains a vegetable garden while “schools, medical clinics, call centers, government offices and even churches are now standard tenants. … Other malls have added aquariums, casinos and car showrooms.” Seattle is adding transit and trying to increase jobs and living space on one site, restoring a creek previously covered by a parking lot.
Patrick Phillips, chief executive of the Urban Land Institute, says there are more malls than needed nowadays and “it can have a blighting influence on communities.” Giant parking lots are often superfluous as public transportation improves. In both countries, some shopping spaces are now being considered for housing, complete with parks and putting greens.
- Portas invites towns to pitch for £1m – Telegraph
- How about gardening or golfing at the mall? – The New York Times
- Social scientists to work with retailers to improve the British high street The Higher Education
- Wrigley calls for residential UK high streets – Financial Times
- Don’t blame supermarkets for high street decline, says Sainsbury’s boss King – The Grocer
- End of the High Street? Big chains shut 14 stores a day last year – Mirror
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Recent Discussions
Discussion Questions
Discussion Questions: Is location becoming superfluous to consumers who can now buy almost anything they need without leaving home? What do you see as the relative strengths and weaknesses of in-town shopping districts trying to compete against mall and online operators?
Poll
It’s not location being superfluous, there never was demand in communities where every offramp had either a Michaels or Bed, Bath and Beyond, Lowe’s or Home Depot, Staples or Office Depot and a Starbucks or Dunkin’ Donuts.
The retail bubble fueled by easy money meant creating shopping where there was no need. Now with the internet and smart apps, all that concrete isn’t needed.
Smart malls like those in WA and AL who have incorporated libraries, post offices and other services are trying to keep the mall as the town center. But how much will we need those services in-person? As a gathering place, we seem to be doing more of that online too.
The idea of adding back what was paved over like the creek, etc., can revitalize an area — but without additional retail space.
There are many items that consumers would rather buy in stores rather than online. Those items that can be purchased at significant savings, or cannot be easily located in local stores will be purchased online. Retail locations need to offer variety, service and convenience and more than the routine. Customers want to be surprised and delighted. If malls and shopping districts can do this, they will draw customers. If they can’t, why would a consumer waste time and gasoline making the trip?
Location is where the heart is. Nothing is easier than sitting at home and buying online. That is until you have to return disappointing merchandise or you see a sale price at a brick establishment that is lower. That’s a trade-off that one sometimes has to evaluate.
If you don’t work downtown, there are fewer inviting forces drawing you there. Parking is expensive, safety can be an issue and traffic is bothersome. Shopping at malls is much like shopping downtown but with fewer inconveniences and possibly more neighbors and friends.
And so I now repeat my entry line, location is where the heart is.
This is an interesting discussion that might last for a period of time before any consensus is reached. Certainly today more people prefer the convenience of mall shopping where weather is not an issue, and convenience is prevalent. Of course, this depends on the quality level of the mall and the needs of the shopper.
However, more and more we are seeing shopping areas that can be described as “downtown” springing up. Areas where shoppers can go with the convenience of upscale stores, restaurants and entertainment to their shopping hearts’ content. The downside is weather. It can sometimes be too hot, cold, or inclement. Those were the same reasons malls began springing up originally. So the cycle continues.
I wonder if I still have any wide ties that might eventually come back into vogue also….
For consumers, there are still many reasons for shopping and buying in stores — it’s not just about price, all day and every day, for every last item.
Location has always been a critical piece of the retail equation. It’s all about convenience. Customers will only shop where they are or where it’s easy to get to (and park).
If retailers are ‘in-town’, are easy to get to, and parking is plentiful (if necessary, then customers will come — assuming the stores are compelling and have what those customers want to buy.
All too often, ‘in-town’ retailers have fallen short — on both the convenience and the compelling metric. Trying to revive ‘in-town’ is swimming upstream unless the location is convenient and the retailer is compelling.
Get serious. If one reads only what is on the web around this topic and never actually ventures out to many malls across the country, they might believe what is being written. HOWEVER, I see malls and shopping centers as crowded as ever in most regions in major markets. Sure there is a ton of vacant retail real estate, however, there are still the majority of consumers whom prefer to shop in REAL stores where they can touch the products. It will be a long time, if ever, before the majority of shopping goes online.
New York City, Chicago, Los Angeles and many other cities are seeing a surge in in-town and mall shopping.
I don’t know that location is superfluous — or that it will ever be. But I do believe that retail centers have a big challenge in the days ahead to rethink what they’re really there for. Location may not be superfluous, but different kinds of inventory will be, and we’ve all known for a long time that there is too much retail space out there in the US, and increasingly so in other mature retail markets.
So retail locations need to step up. I’m with George: location is where the heart is. So much disruption, between the economy, retailers’ responses to the economy, the impact of online and cross-channel, have sucked the heart out of most retail locations. If it’s just about commerce, that’s not going to be enough to cut it any longer. Schools, parks, services — these are all interesting first steps along a road that ultimately leads to assessing how well a location brings together a community. Whether a Galleria or a High Street, if you can figure that out, then I think you’ve got a future.
People like to be entertained, safe, and to be with other people.
If I am in the mall business, these three ingredients are a must. Lifestyle centers have mastered the entertainment part with wonderful mixes of restaurants and theaters for all ages. And there is perception of safety in that there are no scary elevators or stairways between the mall and car. The really successful ones have plazas where people can mingle and linger.
Any regional mall that doesn’t have a plan to integrate entertainment and improve safety should be selling itself to the local community college.
Can Downtown shopping develop these three? Entertainment and people watching are givens when the population density of downtown dwellers reaches twenty thousand or more upwardly mobile professionals. But safety? That’s much tougher.
One only has to look to New York City and Chicago to see how once dangerous places have been transformed to magnificent shopping destinations. But can this happen in Cleveland, Baltimore, Detroit, Newark? I think the answer is yes. Like all cycles, downtown shopping is on its way back.
I do not believe the battle is between malls vs in town, but it is about meeting the consumers’ needs, where, when, and how they want it. There will always be a need/want to purchase in a store, however, those needs/wants will vary with the occasion. Typically those shopping in town are the work force. They only have an hour for lunch to grab something. This calls for a different kind of store and convenience. The mall shopper is typically more leisurely and may not be looking for a specific thing. They are much more about the overall experience.I see more diverse formats as the key to success.
In the U.S., save for a handful of cities, the “city vs. (suburban) mall” battle ended decades ago; and the city lost … big time. Period. (even the Galleria in Cleveland mentioned was actually at the edge of downtown.)
Perhaps in the UK — and Europe, Asia, etc. — this is still an issue, but not here.
I don’t think it is an either/or scenario. It’s an and. Today’s customer is very comfortable in buying in multiple channels driven by different needs. So for stores I think the future is about creating incremental visits by giving the customer more reasons to come shop and not just fulfill a need.
I agree. In many locations I see shopping malls that are full and busy; there are also the complete losers. There seem to be more and more “it” malls and more “loser” malls in many places where I travel, and the “it” malls are BUSY and the losers and dying and failing even if they are trying to revive. This often seems to happen when tied to a star, such as the regional “near-by” location of Nordstrom or other desired stores, including, but not limited to, Wegmans, Whole foods, Forever 21, H&M, Apple Store; and a few others. sometimes in combination. Of course these mentioned stores do cross some age groups, however, a lot of people still want to try things on first, rather than be disappointed and have to send them back.
Downtown vs malls” — well, I agree that unfortunately, downtown lost decades ago. I cannot imagine Cleveland, Detroit, St. Louis, Newark, Baltimore, Memphis, etc, becoming shopping destinations ever again. These once beautiful, full line shopping districts, which offered everything from inexpensive panty hose to the finest furs, are ALL long dead. There now seems to be a regional winner in most of these cities for major shopping — Beechwood/Legacy Village, Somerset, Ross Park Mall, Easton and Polaris, Kenwood Town Center– just as a few examples. Having a bit of service and UNIQUENESS and associated goodies, nice restaurants, easy cheap parking, a nice retail mix, all play a part.
The brick and mortar locations definitely have a place, but where it exactly is does not matter — and in the US, not in the Downtown — because of what happened in the ’70s, ’80s, and ’90s.
Not to deny that there can be small local towns with some business districts that are surviving by being unique and easy, near-by with what you need right now, just for a quick “pick up,” or easy meal out.
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It’s not location being superfluous, there never was demand in communities where every offramp had either a Michaels or Bed, Bath and Beyond, Lowe’s or Home Depot, Staples or Office Depot and a Starbucks or Dunkin’ Donuts.
The retail bubble fueled by easy money meant creating shopping where there was no need. Now with the internet and smart apps, all that concrete isn’t needed.
Smart malls like those in WA and AL who have incorporated libraries, post offices and other services are trying to keep the mall as the town center. But how much will we need those services in-person? As a gathering place, we seem to be doing more of that online too.
The idea of adding back what was paved over like the creek, etc., can revitalize an area — but without additional retail space.
There are many items that consumers would rather buy in stores rather than online. Those items that can be purchased at significant savings, or cannot be easily located in local stores will be purchased online. Retail locations need to offer variety, service and convenience and more than the routine. Customers want to be surprised and delighted. If malls and shopping districts can do this, they will draw customers. If they can’t, why would a consumer waste time and gasoline making the trip?
Location is where the heart is. Nothing is easier than sitting at home and buying online. That is until you have to return disappointing merchandise or you see a sale price at a brick establishment that is lower. That’s a trade-off that one sometimes has to evaluate.
If you don’t work downtown, there are fewer inviting forces drawing you there. Parking is expensive, safety can be an issue and traffic is bothersome. Shopping at malls is much like shopping downtown but with fewer inconveniences and possibly more neighbors and friends.
And so I now repeat my entry line, location is where the heart is.
This is an interesting discussion that might last for a period of time before any consensus is reached. Certainly today more people prefer the convenience of mall shopping where weather is not an issue, and convenience is prevalent. Of course, this depends on the quality level of the mall and the needs of the shopper.
However, more and more we are seeing shopping areas that can be described as “downtown” springing up. Areas where shoppers can go with the convenience of upscale stores, restaurants and entertainment to their shopping hearts’ content. The downside is weather. It can sometimes be too hot, cold, or inclement. Those were the same reasons malls began springing up originally. So the cycle continues.
I wonder if I still have any wide ties that might eventually come back into vogue also….
For consumers, there are still many reasons for shopping and buying in stores — it’s not just about price, all day and every day, for every last item.
Location has always been a critical piece of the retail equation. It’s all about convenience. Customers will only shop where they are or where it’s easy to get to (and park).
If retailers are ‘in-town’, are easy to get to, and parking is plentiful (if necessary, then customers will come — assuming the stores are compelling and have what those customers want to buy.
All too often, ‘in-town’ retailers have fallen short — on both the convenience and the compelling metric. Trying to revive ‘in-town’ is swimming upstream unless the location is convenient and the retailer is compelling.
Get serious. If one reads only what is on the web around this topic and never actually ventures out to many malls across the country, they might believe what is being written. HOWEVER, I see malls and shopping centers as crowded as ever in most regions in major markets. Sure there is a ton of vacant retail real estate, however, there are still the majority of consumers whom prefer to shop in REAL stores where they can touch the products. It will be a long time, if ever, before the majority of shopping goes online.
New York City, Chicago, Los Angeles and many other cities are seeing a surge in in-town and mall shopping.
I don’t know that location is superfluous — or that it will ever be. But I do believe that retail centers have a big challenge in the days ahead to rethink what they’re really there for. Location may not be superfluous, but different kinds of inventory will be, and we’ve all known for a long time that there is too much retail space out there in the US, and increasingly so in other mature retail markets.
So retail locations need to step up. I’m with George: location is where the heart is. So much disruption, between the economy, retailers’ responses to the economy, the impact of online and cross-channel, have sucked the heart out of most retail locations. If it’s just about commerce, that’s not going to be enough to cut it any longer. Schools, parks, services — these are all interesting first steps along a road that ultimately leads to assessing how well a location brings together a community. Whether a Galleria or a High Street, if you can figure that out, then I think you’ve got a future.
People like to be entertained, safe, and to be with other people.
If I am in the mall business, these three ingredients are a must. Lifestyle centers have mastered the entertainment part with wonderful mixes of restaurants and theaters for all ages. And there is perception of safety in that there are no scary elevators or stairways between the mall and car. The really successful ones have plazas where people can mingle and linger.
Any regional mall that doesn’t have a plan to integrate entertainment and improve safety should be selling itself to the local community college.
Can Downtown shopping develop these three? Entertainment and people watching are givens when the population density of downtown dwellers reaches twenty thousand or more upwardly mobile professionals. But safety? That’s much tougher.
One only has to look to New York City and Chicago to see how once dangerous places have been transformed to magnificent shopping destinations. But can this happen in Cleveland, Baltimore, Detroit, Newark? I think the answer is yes. Like all cycles, downtown shopping is on its way back.
I do not believe the battle is between malls vs in town, but it is about meeting the consumers’ needs, where, when, and how they want it. There will always be a need/want to purchase in a store, however, those needs/wants will vary with the occasion. Typically those shopping in town are the work force. They only have an hour for lunch to grab something. This calls for a different kind of store and convenience. The mall shopper is typically more leisurely and may not be looking for a specific thing. They are much more about the overall experience.I see more diverse formats as the key to success.
In the U.S., save for a handful of cities, the “city vs. (suburban) mall” battle ended decades ago; and the city lost … big time. Period. (even the Galleria in Cleveland mentioned was actually at the edge of downtown.)
Perhaps in the UK — and Europe, Asia, etc. — this is still an issue, but not here.
I don’t think it is an either/or scenario. It’s an and. Today’s customer is very comfortable in buying in multiple channels driven by different needs. So for stores I think the future is about creating incremental visits by giving the customer more reasons to come shop and not just fulfill a need.
I agree. In many locations I see shopping malls that are full and busy; there are also the complete losers. There seem to be more and more “it” malls and more “loser” malls in many places where I travel, and the “it” malls are BUSY and the losers and dying and failing even if they are trying to revive. This often seems to happen when tied to a star, such as the regional “near-by” location of Nordstrom or other desired stores, including, but not limited to, Wegmans, Whole foods, Forever 21, H&M, Apple Store; and a few others. sometimes in combination. Of course these mentioned stores do cross some age groups, however, a lot of people still want to try things on first, rather than be disappointed and have to send them back.
Downtown vs malls” — well, I agree that unfortunately, downtown lost decades ago. I cannot imagine Cleveland, Detroit, St. Louis, Newark, Baltimore, Memphis, etc, becoming shopping destinations ever again. These once beautiful, full line shopping districts, which offered everything from inexpensive panty hose to the finest furs, are ALL long dead. There now seems to be a regional winner in most of these cities for major shopping — Beechwood/Legacy Village, Somerset, Ross Park Mall, Easton and Polaris, Kenwood Town Center– just as a few examples. Having a bit of service and UNIQUENESS and associated goodies, nice restaurants, easy cheap parking, a nice retail mix, all play a part.
The brick and mortar locations definitely have a place, but where it exactly is does not matter — and in the US, not in the Downtown — because of what happened in the ’70s, ’80s, and ’90s.
Not to deny that there can be small local towns with some business districts that are surviving by being unique and easy, near-by with what you need right now, just for a quick “pick up,” or easy meal out.