“The Not so Bright Future of Malls”

The shopping industry is in the midst of a revolution, and everyone should be prepared because major changes are on the horizon. Numerous online platforms have made purchasing all types of products possible from anywhere, ranging from the couch in your home to the lounge chair on your favorite beach. This is undoubtedly a great experience for consumers, as it only takes a few clicks to have any state-of-the-art product you could possibly imagine right on your doorstep. Shopping has never been easier. However, as the online shopping industry skyrockets, malls in particular have taken a turn for the worst. It has been difficult for these malls to compete with the efficiency and reliability of online shopping, and with the coronavirus continuing to affect the opportunities for large public gatherings, this may be the end of malls as we know it.

It was the Austrian architect, Victor Gruen, who immigrated to the United States and organized plans for an outdoor shopping court in the Detroit area. This was in 1954, and in 1956, the first mall in America, the Southdale Center of Edina, Minnesota, was built and inspired by Gruen’s designs. The mall industry was booming especially towards the end of the 20th Century. The 1970s-1990s were times where malls were at the forefront of consumerism, and retailers sold all their products in person. There was no online outlet, so malls were very successful and reliable options for various companies and retailers to do business.

Personally, I believe malls are a great experience all around, and they provide much more than simply shopping opportunities. Malls have always been a place for communities to gather together. When you had family visiting, or you and your middle school friends needed somewhere to hang out that was okay with your parents, etc, the mall was always a great option. Not to mention, the amount of jobs that were created from all these retailers that would do their business in malls was remarkable. Depending on the size of the mall closing down, that could be hundreds even thousands of employees that are now out of work.

The 2010s specifically have been a very difficult time for not only malls but retailers in general. Blockbuster, Sports Authority and countless other companies have closed in the previous decade, and there is one competitor in particular that many of these retailers have in common. Amazon has been at the forefront of the online shopping industry, and many of these stores have tried to compete with Jeff Bezo’s business. It is these efforts to stay afloat that have actually been the cause of their downfall. John Haber, the CEO of Spend Management Experts, stated, “Amazon is the biggest threat to the retail industry and as such retailers are spending heavily to keep up with Amazon,” (USA Today). He went on to later explain, “This strategy has proved deadly for those retailers that spent themselves straight into bankruptcy,” (USA Today). These retailers clearly want to use all their resources to appeal to consumers, even with threats from other competitors. However, with the majority of these efforts not fulfilling their purpose, this is more money being lost from an already struggling retailer.

The coronavirus has affected all different aspects of life, especially consumerism. Because of the inability to attend large gatherings, opportunities to go to malls have been incredibly restricted. Malls were already closing their doors nationwide, but the pandemic has only accelerated this process. Retailers have started to realize that doing business in these large shopping plazas is no longer a viable method of conducting business. In the past year alone, 15% of malls have been closed down for good. Even if the entire mall does not close, many stores continue to leave, and the rate of replacing these retailers has been on the decline. It is stated that for a mall to no longer be sustainable, it needs to have a vacancy rate of at least 20%. The percentage of malls with that statistic spiked from 8% to 28% in the past year. An extremely important aspect is that some retailers are much more successful than others. These “anchor tenants” are what mainly attract people to the malls. Once large retailers, such as J.C. Penney, Lord & Taylor, or Macy’s, begin to transition out, the hope for these malls diminishes drastically.

It is a shame that malls have been shutting down all over the country. But if history has taught us anything, it is that if you cannot adapt to the surrounding environment, you will not be able to flourish and prosper. This modern age of smart technologies and innovations is a new environment that has proven very difficult for malls to become accustomed with. Consumers have realized that online shopping can be much more convenient, and although they are not having the same “shopping experience,” when it comes down to it, they are still receiving the product they purchased. Retailers want to foster the most enjoyable customer service experience they can, and although online shopping is a part of that, the value of in-person shopping should not be forgotten either.

As the retail industry continues to transition online, there is little hope for the future of malls. However, consumerism has constantly been changing. There is no telling how malls will be affected in upcoming years. I personally hope some are still open, and maybe there will be a chance for malls to recover and be implemented once again.

 

 

 

Sources:

https://www.washingtonpost.com/business/2019/11/22/malls-are-dying-only-these-ones-have-figured-out-secrets-success-internet-age/

https://www.cnbc.com/2020/08/27/25percent-of-us-malls-are-set-to-shut-within-5-years-what-comes-next.html

https://www.theatlantic.com/technology/archive/2018/02/when-malls-saved-cities-from-capitalism/553610/

https://www.usatoday.com/story/money/2019/12/29/decade-store-closings-biggest-retailers-lost-decade/2750954001/

https://www.forbes.com/sites/andriacheng/2020/10/08/coronavirus-will-be-final-catalyst-to-weed-out-excess-us-malls-study/#4f6a8e746642

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