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Maybe Malls Aren't Dead After All

By Daniel B. Kline - Oct 9, 2019 at 7:12AM

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The vast majority of Americans still visit one at least once a month.

You can't argue that America's malls aren't in a state of evolution. A number of traditional anchor stores have either shrunk or closed altogether. Mall staples including Payless, Teavana, and Charlotte Russe have closed, while chains including Forever 21, Gap, and Gymboree have shuttered numerous stores.

Those closures have forced mall owners to get clever and do things like adding gyms, event spaces, food halls, and entertainment brands like Dave & Buster's. Exactly how well any of that will work and what chains will survive remain to be seen. But a new survey of 20,000 U.S. consumers conducted online for Shopkick, a shopping rewards app, and Southdale Center (America's first indoor mall) in Edina, Minnesota, showed that most Americans still go to the mall at least once a month.

A consumer uses a phone in a mall.

Consumers are still going to malls. Image source: Getty Images.

Let's go to the mall?

90% of those surveyed said they still go to malls, with 60% saying they visit at least once a month and 18% at least once a week. Perhaps most interestingly, younger generations were more likely to go to malls than baby boomers.

Foot traffic, it should be noted, has declined in malls after posting a 2018 comeback, according to a CNBC story that cited multiple data sources. The declines are slight and not indicative of a major move away from visiting malls. (Whether visitors spend less while there is an entirely different story.)

Malls have long been about more than shopping. Older people meet at the mall to walk for exercise, and younger people go there to congregate away from their parents. You can now buy most things sold at a mall elsewhere, but there are parts of the shopping experience that can't be duplicated.

Malls may be less necessary than they once were, but younger generations can't hang out together at a digital retailer. They also can't get immediate gratification, and snacking remains an important aspect of a mall visit, with 45% of respondents in the poll naming Auntie Anne's as their favorite mall snack, followed by Cinnabon (21%), and Orange Julius (7%). 

Many of those surveyed also admitted to having a significant life moment in a mall. Almost half (46%) have been on a date at a mall, 44% got their ears pierced there, and 38% have made a meaningful purchase there (like an engagement ring or a wedding or prom dress). About a quarter (24%) had their first experience with Santa Claus at a mall, while 47% called it "their first hangout spot," and 15% had their first job at a mall.

Change isn't failure

The "retail apocalypse" has been blamed for a lot of things, some of them unfairly. How people shop has changed and will continue to change. Some major retailers will close and some others will shrink. A number of smaller digital-native brands are adding stores, but a very clear picture has emerged for mall operators: You need to be clever to remain strong.

That means adding gyms, hotels, things to do, and nontraditional mall retailers. The strongest mall owners understand that. Consumers still have discretionary income and they're still going to the mall. To benefit from that fully, mall operators have to work with their tenants to keep offering up significant life moments -- and sometimes just a place to hang out.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Stocks Mentioned

The Gap, Inc. Stock Quote
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Dave & Buster's Entertainment, Inc. Stock Quote
Dave & Buster's Entertainment, Inc.
PLAY
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