3 Adaptive Renewal Strategies Developers Are Using Today
Retail in the 21st century has completely changed the game. The rise of technology and importance of experiences over "stuff" has led many consumers who used to flock to malls every weekend to instead use the wide variety of other options available today to fulfill their shopping needs and wants. Big names such as Macy's, Sears, Gap and even Abercrombie & Fitch are closing several stores in response to decreased mall traffic. Business Insider notes a study by real estate research firm, Cushman and Wakefield that found a 50% drop in mall traffic from 2010 to 2013, a number that is only expected to climb as technology becomes more pertinent in our everyday lives- as it hasn't done already.
While changing at an alarming rate, malls and shopping centers alike have had much experience with adapting to the wants of consumers over time. The following are some of the adaptive renewal tactics malls and shopping centers have used in the past:
1. Demalling
Defined as breaking up traditional malls and turning them into “open-concept” store clusters, demalling has gained substantial ground in recent years as seen with many new outlet malls being designed to have a more outdoor, upscale shopping center feel.
2. Spatial Reconfiguration
When big department stores close, such as Macys, malls and shopping centers may have trouble finding large enough tenants to rent the space, a problem that can be turned into an opportunity using spatial reconfiguration. Malls and shopping centers can strategically populate empty space with retailers in the technology sector to attract customers. Some brands malls or shopping centers may consider to add are Apple (which already are in all, if not most, malls in America), Tesla, and Microsoft.
3. Bumpbacks
However, while waiting for these technology giants to be interested, malls and shopping centers can utilize large, unused space by moving a smaller, temporary renter into the front portion of the large space in order to ensure the mall still looks full while waiting for a larger renter. This is also known as a bumpback.
Other strategies used include having stronger marketing, that brings more customer experiences into the mall, or even treating the mall itself as a brand, however there is no evidence that the latter is a successful tactic. Regardless, malls and shopping centers have a variety of ways to cope with the ever-changing consumer climate that make many optimistic about their long-term survival through this uncertain period.
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