A Fresh Approach to Retail
In just two weeks, the American Dream Mega-Mall of the New Jersey Meadowlands is set to open its first phase of its enormous three-million square foot mall. The Mega-Mall will include a Nickelodeon Universe Theme Park, the Dreamworks Water Park, the Big Snow Ski and Snowboard Park, the Angry Birds 18-hole Miniature Golf experience, and an NHL-size Ice Rink, which will host league games, figure skating events, and shows on ice. The subsequent three phases will include over three-hundred upscale retail stores, a diverse array of restaurants, and various bars and nightclubs.
With 55% of the new mall complex dedicated to entertainment, American Dream Meadowlands is clearly demonstrating the new approach that retailers are taking to selling and marketing their goods.
Myth: In-store retail is dying
In fact, apparel retailers are profiting more from in-store sales as opposed to the profit they generate from online sales. Research shows that 30% of online purchases are returned, adding extra shipping, dry-cleaning, and processing costs, which drive up expenses significantly. Stores are finding that traditional brick-and-mortar buildings are still more cost-effective to operate.
Retailers are learning that when you couple in-store and online purchases together, they are seeing a higher total sales volume. A study done by the International Council of Shopping Centers discovered that “when a consumer spends $100 online and subsequently visits a physical store within 15 days of that purchase, the person spends an additional $131. If they start out with that same $100 purchase in-store and head online within 15 days, the average additional spend is even greater, at $167.” This synergistic relationship between online and in-store shopping is not something to be overlooked, and retailers and malls are adjusting their methods of attracting customers into their stores.
Co-Retailing is the Future
If you are a Nashvillian (Unicorn or transplant) you have most likely dined-in or seen the 70,000sf Restoration Hardware that opened in Green Hills in 2Q2018. The four-story building includes a full restaurant, wine bar, barista bar, and a rooftop patio all outfitted entirely with RH furniture and fixtures. “We thought if we have people eating in our space, inspired by our space, wandering our space, maybe they’ll be inspired to redo their homes,” Restoration Hardware CEO, Gary Friedman, said. What better way to display your goods in a way where patrons can actually experience them?
Not only does co-retailing attract more consumers, but it also helps to cover the cost of occupying a space. Along with restaurants, retailers are also teaming up with hotels, airports, hospitals and other places that draw a high-volume of foot-traffic into their spaces. With the traditional mall models slowly declining in popularity, it is safe to say that we will see more and more co-retailing spaces pop up across the country as retailers adjust to the shift in how people buy their goods.