The identity of the anchor store in nearly every mall once was quite well defined: a large, well-known, branded department store that would have a large footprint and provide a common entryway into the center of the mall. But in the aftermath of the economic recession, mall occupancy rates dropped dramatically. Furthermore, the competition that modern brick-and-mortar retailers face has pushed malls and their tenants to change the definition and widen the meaning of anchor stores, to include a broader range of retail providers.
In particular, more mall properties have started to feature grocery stores in prominent locations. Similar to traditional anchor stores, grocers sell products that most shoppers need, tend to highlight their familiar brand names, and account for a significant portion of the mall’s total real estate. By adding such stores, developers enhance the one-stop shopping convenience offered to consumers and promise benefits for their other tenants. Consumers who need to stop by the mall anyway to pick up a few groceries are more likely to take a few extra steps to outfit themselves with a new pair of shoes or check in on the latest fast fashions.
Another option as an anchor store offers a different and seemingly stranger kind of fit with malls. When fitness centers and gyms provide the anchors, the mall developer probably does not expect customers to finish their sweaty workout and then go try on new clothes. Instead, a mall that features a fitness center becomes a routine site that many shoppers visit regularly. Because they are so familiar with the location they visit for every workout, they also may be more likely to revisit it when they need to find a tux or a gift for a friend.
Because of the competition created by the rise of e-commerce, traditional versions of malls have become largely a thing of the past. They have relatively little in common with not only the versions of malls that appear in the marketplace today but also those slated to come in the future. As one retail analyst notes, “If you had told a developer or landlord 15 years ago that they would be putting grocery stores or fitness centers in malls, they might have looked at you sideways. Not only are they doing it now, but [they] are finding success in its application.”
- What are mall operators and tenants doing to motivate customers to buy?
- How is the tenant mix changing in today’s malls? Is this a positive change for mall operators? What about customers?
Source: Krystina Gustafson, CNBC.com, April 22, 2014