On a visit to the US last month, it was impossible not to notice how the retail experience has changed over the last ten years — specifically, the decline of the shopping mall, writes John Daly.
Once the world leader in maximising the spend within a dedicated all-weather environment, this American institution has undergone traumatic change in the last decade, wrestling with changing consumer trends.
Industry observers predict that a quarter of American malls will close over the next five years — more than 300 out of 1,100 that currently exist. Such has been the focus around the so-called ‘death spiral’ of this former cultural touchstone, epitaphs to its passing are now regular features in media business pages.
A website called Deadmalls.com lists, in grave detail, a chronology of the casualties within the sector, while a YouTube series, The Dead Mall, documents “the countless mausoleums of forgotten economic booms and ghosts of capitalism past.”
With a number of classic films like Fast Times At Ridgemont High, Bad Santa and Mallrats set within these retail palaces, one wag compared the current decline more closely with the 1978 zombie movie, Dawn of the Dead.
Indeed, given that American consumer behaviour has dictated much of the commercial initiatives and innovations adopted on this side of the Atlantic over the past half century, could the death of the mall carry a timely warning for Irish and European shopping trends of the future?
Since the first US indoor mall — the Southdale Centre in Edina, Minnesota — opened in 1956, these shopping emporiums have been a favoured destination of not just America, but the rest of the world — a fact underlined by the pre-Christmas shopping jaunts so popular with Irish people during the Celtic Tiger years.
Having followed a mostly upward graph almost to the Millennium, the sector began to record steep declines from 2001 onwards with up to 500,000 jobs lost in a 25% commercial plunge. Within the last decade retail giants like Sears, JC Penney and Macy’s have drastically reduced their outlets.
When large anchor tenants leave, they take much of their foot traffic with them — impacting directly on the neighbouring smaller units with an immediate fall in sales, increased layoffs and pleas for reduced rents.
A typical example was the Rolling Acres Mall in Akron, Ohio, opened in 1975. When consumer traffic began to dry up around 2007, stores began to abandon their leases, with a knock-on effect down the retail line. The last store in the complex closed in 2013, leaving the vast centre the scene of a number of crimes.
As to the blame for this retail apocalypse — clearly online shopping bears much of the burden, allied to changing shopping habits. With the myriad treasures of Amazon available at the touch of a keyboard and the advent of ‘big box’ one-stop stores like Target and Walmart offering greater convenience, the traffic to those former suburban retail palaces has detoured in other directions. Recent surveys show that Americans are now spending more on home technology and vacations, while the clothes shopping once done at the mall is now more toward discount houses like Family Dollar, Costco and TJ Maxx.
That said, the death notices for this institution may yet be proven premature — at least if the legendary Mall of America has anything to do with it. Located in Bloomington, Minnesota, and opened in 1992, it remains the country’s biggest mall with over 500 stores. Having last year celebrated 25 years in business, its owners, the Triple Five Group, manage a number of ‘mega malls’ — all of which are thriving due in large part to providing a carefully chosen mix ranging across retail, hotels and entertainment.
Spotlessly clean, security conscious, climatically controlled at a constant 70 degrees, the Mall of America has an annual throughput of 40 million customers. Mixing entertainment and shopping, it continues to defy the sector’s troubled outlook in the only place it really matters — the bottom line.
© Irish Examiner Ltd. All rights reserved