Retail’s Evolution:So chic, so hip, so you!

Our reader Rajeev has sent an interesting piece on Changing trend in shopping mode in the USA. Although, quite nascent at the moment, it would not be surprising, if the trend soon catches on as a fad. Reproduced below are excerpts from a report originally published in the Press Enterprise.

Promenedshops

In the past decade, the Inland shopping scene has morphed from mega indoor malls to open-air centers designed to lure customers with a new level of retailing and a setting made to encourage lounging, drinking, chatting and even living. The evolution continues with the recent opening of The Promenade Shops at Dos Lagos, a Corona center that showcases trendy shops and restaurants encircling two lakes and a bridge traversing a 10-foot waterfall.

Retailers are banking on the idea that consumers want more than the sterile traditional mall. The Promenade Shops, bring a collection of retailers, such as Williams-Sonoma and Banana Republic, that are considered high-end though not Tiffany and Versace luxury.

And The Promenade Shops does it without Macy’s and J.C. Penney, bucking the long-held assumption that a shopping destination could not attract top-shelf brand names — or shoppers — without department stores.

Such centers work in the Inland Empire because they give residents something more than a mall and provide retailers a way to tap into the region’s growing buying power, said Larry Kosmont, a developer and consultant for various Southern California cities. “People are crying out for local neighborhoods,” he said. “And what these open-air centers tend to do is create a sense of place.”

Developers also are looking at ways to turn their customers into residents. Townhomes and condominiums are being built within walking distance of The Promenade Shops, where twentysomethings are targeted with this tagline: “So chic, so hip, so you!

Specialty stores have learned that clustering together in an entertaining setting, as they have at The Promenade Shops, can be just as attractive and more lucrative than having department stores.

Terry McEwen, president of Poag & McEwen, which is building and managing The Promenade Shops, said annual sales at the company’s other lifestyle centers are $400 to $500 per square foot, while the average for most mall stores — excluding department stores — is about $392.

Outdoor shopping was once common, but then many larger centers added roofs to keep pace with the spread of air-conditioned indoor malls in the 1960s and ’70s.

Mall developers had it easy in those decades, said Michael Niemira, chief economist at the International Council of Shopping Centers. They found land, put up a mall and knew shoppers would seek it out.

All Looked the Same

Beyond the two-floor, roofed template, mall companies typically stocked their properties with the same chains, Bayard said.

“When you were inside, you really didn’t know where you were. They all had the same palm trees and the same marble floor,” he said. “You would think people in the Inland Empire lived exactly the same as people in Chicago.”

Bored with the mall formula, consumers began treating shopping as a chore rather than an experience, said Brian Jones, CEO of Forest City Enterprise’s western commercial division.

Retailers often prefer the outdoor format because they save about 35 percent on maintenance costs, McEwen said. Having no corridors to heat or cool helps, he said.

Also, department stores don’t dictate hours, and parking tends to be more convenient than at indoor malls.

But don’t say goodbye to the indoor mall just yet, said retail analyst George Whalin. “There are some very, very successful indoor malls that are a permanent
part of the landscape,” he said.

“In a mall, you get lost in the shuffle,” said Mike Edwards, CEO of lucy, a women’s clothing chain.

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