Steven Tanger joined Tanger Factory Outlet Centers (NYSE:SKT), founded by his father in 1981, as the company's fourth employee. The company had grown to 13 outlet centers by 1992, and the following year became the first outlet center developer to be listed on the New York Stock Exchange as a publicly traded REIT, under ticker symbol SKT. Tanger has been president and CEO since 2009, and the company's portfolio, growing steadily, now includes more than 40 outlet centers across the U.S. and in Canada.
From providing free Wi-Fi to offering a deal-finding app, Tanger works hard to enhance the customer's experience -- which includes keeping the non-shopping spouses and family members entertained and making sure they enjoy the experience as well.
Tom Gardner: What are the changing dynamics of the tenants, and just the experience you will get, going to a Tanger mall, over the next 10 years or five years? What do you think some of the new features might be? Events? Experiences? You were talking about the lifestyle-type businesses that are showing up in neighborhood malls or shopping malls now. Movie theaters? More food? More experiences? Or something else?
Steve Tanger: We spend a lot of time focusing on how to enhance the consumer's experience and give them joy when they come to our center to shop. We were the first national shopping center developer to put free Wi-Fi on every one of our properties -- not because we thought it was cool but because, candidly, I wanted to entertain the non-shopping spouse.
Gardner: NFL Sunday Ticket!
Tanger: Really, it's not gender-specific and it's not age-specific. You go into our centers now -- in our food courts, or by our fountains, or under our beautiful landscaping, sitting on a bench -- and you'll see people and children on their devices, happily entertained. That gives the shopper more time in the store, without being pulled out.
Gardner: Would you say that your general thought about your customer base is that it's a family that's coming?
Tanger: We love to entertain families. Particularly at resort locations, we are usually the second most popular thing to do on vacation. Now, if you go to the beach, it's the beach. If you go skiing, it's skiing. But usually one or two days, the weather doesn't cooperate and you go shopping, and we hope you'll come shopping at a Tanger outlet -- and usually families go shopping together.
In our pass-by locations, or more middle-market locations, people will make multiple day trips during the month or during the year, and go as a group. A group of friends will go in a car; three or four in a car, and come shop for three or four hours, and have lunch, and then go home. We want to be sure that they're entertained.
We were the first mall real estate investment trust to have an app. We have the Tanger app, which is hooked up to GPS and Yahoo! If you go on our site and you're on the Tanger app, it will ping you. For instance, if you go in front of a J.Crew store, and J.Crew is running a 20% off, it will ping you and you can literally go into the store, show them your phone with the Tanger app and the barcode...
Gardner: You mean a J.Crew anywhere?
Tanger: No, in a Tanger Outlet Center.
Gardner: Will there be a Tanger Center online to buy from? Is that a possibility?
Tanger: I don't think that's a possibility. I think people love to socialize. People like to touch fabrics, they like to try things on, they like to experience the joy of going shopping. Apparel and footwear are difficult to sell online profitably, and that's why we've been able to survive. At the same time the Internet sales have grown, our sales have grown.
I think most of our tenants today have a dot-com division, but people use that for informational purposes. But when they come to the center, they buy. Unlike digitized type of products, like books or movies or music, which can easily be downloaded and purchased online, it's difficult to find the right color and the right size online.