How Malls Plan to Remain Financially Resilient in an Online World
Mall Operators’ Strategic Shift
Mall operators feel the need to pivot. The pandemic has accelerated the movement toward online shopping, and the old playbook is getting a makeover. Some mall operators are shifting their strategic vision and diversifying in order to keep foot traffic and revenue up.
This partly involves pivoting away from the retail store as the primary consumer magnet, with many malls broadening their offers to include recreational attractions. The goal is to have the mall become an enriching part of the customer’s social life with multigenerational appeal.
Mall operators are looking for ways to develop engaging social experiences through traveling exhibits, sports, and dining options. Tanger Outlets (SKT), which operates 36 outlet centers in North America, will spice up the mall experience by offering virtual golf and Pickleball. It also expects its craft breweries to attract younger customers. Brookfield Properties seeks to broaden its appeal by offering virtual reality games and indoor skydiving.
Mall operators are also seeking to extract value from vacant spaces by filling them with traveling art and other exhibits. This practice should help to plug financial leaks from unused space by increasing mall traffic. Tanger even maintains a honeybee colony that offers an enriching learning experience.
Consumers may appreciate the efficiency of the mall as a recreational destination that can keep the whole family entertained. Operators hope the diverse offerings will lead to extended stays and more dollars spent.
Analysts say that for many of these malls the aim is to provide a productive and engaging environment. The ability to multitask while strolling the mall could increase the time spent on an average trip. For mall operators feeling the squeeze from online shopping, it’s part of a necessary adaptation.
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