How will most regional malls fare over the next 5-10 years? Vote and view live poll results
	Recent Poll: Almost 80% are doing location-based mobile with customers, or planning on it. See results below. See full results below.

The National Retail Federation’s magazine had a story on what they see as resurgence by regional malls, From Doom to Vroom.

The theme is that regional malls are nowhere near as dead as articles were saying they were six months or a year ago.

“Developers have gotten more creative with the space and it’s beginning to yield fruit,” [Deloitte] says. “Essentially, they’ve gone back to the genesis of the shopping mall and its origins as a social center that blends shopping and entertainment — even housing — in an enclosed community. Mixed-use properties, versus those solely focused on apparel shops, will give consumers a reason to come back again and again.”

Sociologists have long said that the mall was an updated version of the ‘village square’, but I never really bought into that idea too much. Except that, even long ago in my youth, it was where teenagers went to promenade and flirt as, I presume, they once did in the village square. Food courts, I suppose created more of a community feel, but in recent years (even before the recession) I have seen malls that were renting space to day care centers, local libraries, extension campuses of community colleges, and even municipal offices, which is, as Deloitte says, making the mall into a social center.

I’m not sure if this was the intent, or if such changes were simply desperation moves to fill space, since the malls doing such things have most often been those on the edge. And Bill Taubman, COO of Taubman Centers, doesn’t think much of the trend:

“I want a big name like Macy’s as an anchor whenever it’s possible because department stores still have the greatest relevance when it comes to driving traffic,” Taubman says. “Adding schools, mom-and-pop shops and service providers are interesting ways to fill space, but in our experience they don’t deliver anywhere near the amount of foot traffic.”

The problem is that there aren’t enough department stores left to fill all the anchor spots available:

On the West Coast, Forever 21 has moved into several spaces once occupied by now-defunct Mervyns. Target has set up shop in spaces once occupied by department stores: It recently moved into a former Lord & Taylor store in Delaware. Costco, which as recently as five years ago, would have been deemed a most unlikely mall candidate, now operates in a handful of regional centers.

Target now has eighty-five mall locations. It once was standard that department stores had ‘no discounters’ clauses in their mall leases – but apparently they don’t have the muscle anymore. And besides, what would be the point? – the discounters are on the mall’s perimeter road anyway.

So is the regional mall making a comeback? I tend to be skeptical. I’m sure malls are doing a bit better – the economy is picking up, so just about everybody is doing better. But I think malls – which I have always looked at as oversized department stores – will follow the pattern department stores have followed over the past several decades. They suffer in recessions, and each recession they go a bit lower than they did the one before. And then they come back (to a spate of stories about ‘the resurgence of department stores’) in the recovery – but each time they come back, it is to a peak lower than the previous time.

However, whereas department stores have tried repeatedly over the years to ‘reinvent’ themselves without yet finding a reason for existence, malls still could do so – perhaps becoming centers for entertainment and social gathering as well as shopping will be their salvation. We’ll make that our exit question: How will most regional malls fare over the next 5-10 years?

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Just for Fun: A Day in the Life of a Walmart

A fascinating video – time-lapse photography captures twenty-four hours at a Walmart store in 150 seconds. Click Here.

Recent Poll


We discussed location-based mobile advertising last time, and we asked our readers if their companies were doing such promotions in conjunction with retailers.

• 50% Yes
  
• 26% No, but we’re working on it / thinking about it
• 3% No, but we’ve done other promotions involving mobile ads
  
• 21% No, it’s not in our plans at present
  

I was surprised (and pleased) that so many are already doing this, and that so many others have it in their plans. It may never be universal, because it isn’t necessarily applicable to all products/channels, so the 21% who have no plans may be doing the right thing.

Follow-Ups

Dallas Morning News has a roundup of efforts by department stores to differentiate through private labels, which included this chart:

Interesting factoid from NPD: “Over the last five years, private and exclusive brands have grown 8 percentage points to 41 percent of apparel sales.”

Online
Sears, as we’ve mentioned before, seems to think its future may be mostly online – which would be fitting for a company that started out as a cataloguer.

The article linked is a good summary of Sears’ and Kmart’s initiatives in online marketing, including mygofer.com, which allows consumers curbside pick-up:

Sears went further in May 2009, when it converted a Kmart store in Joliet, Ill., into a pickup point for consumer-direct orders that it dubbed mygofer. Shoppers can order goods at mygofer.com, using the mygofer mobile phone app or by calling an agent. The store offers more than 20,000 items, ranging from dog food to appliances, as well as perks like free gift wrap.

When an item is ready, the system sends shoppers a text message. Consumers picking up purchases can wait in a designated parking spot and have a clerk roll out a cart and load the goods into the customer’s car.

There is only one full-fledged mygofer store, but the company has created mygofer-branded counters at more than 150 Kmart stores, many of which offer curbside pickup. Sears aims to use the Kmart locations to build the mygofer brand and encourage shoppers to use the offering for everyday purchases they might not normally make online, like paper towels.

Saks
We mentioned last time that Saks is planning to close a significant number of its stores. However, it’s planning to open several of its smaller, lower-priced OFF 5th stores.

New OFF 5TH stores will open in metropolitan Pittsburgh, Pennsylvania; Portland, Oregon; Houston, Texas; and Raleigh/Greensboro, North Carolina, and the OFF 5TH store in Riverhead, New York is undergoing renovation. The new OFF 5TH stores will range between approximately 23,500 and 29,000 square feet.

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TPMA and MEI Present:
The Incredibly Shrinking Shelf – 5 Ways to Stay Relevant
Wednesday, May 19, 2010 2:00 PM - 3:00 PM

As store brands have gained competitive advantage as lower-cost alternatives to national brands, CPG manufacturers have found themselves competing more on price, and in some cases even fighting to stay on store shelves. While the economy is beginning to show signs of improvement, shopper behavior may remain price sensitive for the foreseeable future. This free webinar will explore ways CPG manufacturers can fight to remain relevant in the eyes of the consumer in an ever challenging retail environment.

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Quickly Noted

Movie Gallery Stores to Close
Following the record stores, movie/video stores seem to be the next channel to disappear. Blockbuster is still breathing, but Movie Gallery is shutting down, closing its 1900 stores under the Movie Gallery, Hollywood Video, and Game Crazy banners. “The closing means small mom-and-pop stores are the only movie rental places left in the Panama City area. Blockbuster closed three Bay County stores in the past couple of years.”
Panama City News-Herald, 4 May 2010

Coke’s New World Cup Goal: Mainstream US Consumers
Although Coca-Cola has been a major World Cup sponsor for decades, they have used the event primarily for international promotions and to reach Hispanic consumers in the US. This year, they will be using World Cup promotions to reach the general US consumer. According to Coke: “Soccer is one of the top three most practiced sports among youths in the US … it’s the most practiced sport among kids ages 8 to12 years old.”
Brandweek, 27 April 2010

Walmart Rethinking Russian Entry Strategy
Walmart is reported to be considering building its own stores as well as buying an existing Russian retailer. There’s no reason to expect a quick decision, because Walmart has been pondering the move since 2007 and has had Moscow offices since 2008. One possible reason for caution: “… French rival Carrefour in October abruptly decided to pull out of Russia after just four months here, a move attributed to lack of any growth or acquisition prospects.”
Moscow Times, 30 April 2010

Radio Ad Sends Signal, Dials Phone
A Dutch company has come up with a technology that allows a consumer to hold their phone by the radio and the radio will send a message that dials the phone. You can see a YouTube demo at the link, which notes that there are web applications to the technology. It’s a cool idea and a great advance if only to eliminate the radio spots that consist of endless repetition of a phone number: “Just dial 1-800-555-1234 to speak to our helpful representative. That’s 1-800-555-1234. Remember, just call 1-800-555-1234 …”
MediaBuyerPlanner, 3 May 2010

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