With retailers closing an estimated 9,300 stores in the US alone in 2019, up from 8,000 store closers in 2017 according to Business Insider, many people have begun to ask – is this the end of traditional retail venues as we know it? In some ways the answer is “yes”, but that doesn’t mean malls themselves are destined to be a thing of the past.
The Decline of Traditional Shopping Malls
With the ever-increasing rise of online purchasing and direct home shipping services, traditional retail chains around the world have been hit exceptionally hard – especially around holiday seasons where venues would see the greatest upticks in sales numbers for holiday shopping. For shopping malls this lack of traditional retailers filling necessary commercial spaces can spell danger as active commercial establishments not only fund continuing mall operations but drive foot traffic to the mall as a whole, increasing the overall property value. For some, though, this ever-growing availability of prime real estate is opening up greater opportunities for bringing new experiences to areas and change the way communities look at malls as a whole.
The Growth of Location-Based Entertainment
As retail stores continue to face difficulties due to ever changing consumer demands mall developers and managers are turning more and more to customer engagement experiences and service providers. This includes education and training centers, modern arcades, service stations, children’s playgrounds or full customer engagement platforms providing immersive environments. Without having to rely upon physical goods to sell to consumers, customer service and engagement providers can not only provide products and services not available online or in most general locations but can help create immersive new experiences to both draw in new customers and retain existing regular mall-goers.
This is heavily due to the fact that a general consumer’s need for social and emotional experiences not found in online settings hasn’t gone away. If anything, this trend has created a greater need than ever before, with Forbes stating “Consumers are [now] looking for places to be—not things to buy—when they leave the house.”
Building Live-Action Real Life Adventures (LARP)
One such example of a traditional retail center embracing these changes is Planet J in Macao, China. Opening in 2016, Planet J was designed to be the world’s first ever player centric, live action role playing (LARP) theme park. Created on existing Venetian property this massive 100,000 square foot (10,000 square meter) facility houses eight distinct gaming zones with more than 200 interactive games. Guests using their “Magic Scroll” – a smart phone loaded with Planet J apps and connected to a master computer – are able to adopt a fantasy persona and act out a variety of personalized physical and intellectual challenges to achieve quests throughout the Stone Kingdom.
This is allowing for guests to physically interact with their environment in ways never implemented before in a new concept of a Family Entertainment Center (FEC), Planet J provides entertainment opportunities for people of all ages and acts not only as a local attraction but an international attraction as well. As an active development partner, EDGcompany crafted the Planet J themed fantasy world from blue sky planning to documentation and was also responsible for project management from design through construction. https://edgcompany.com/destination/planet-j/#tab-13
Mainland Shopping Malls Embracing New Entertainment Experiences
Shifts such as these can be seen all over China and other countries as more space traditionally set aside for retail venues is being shifted towards customer experience centers or entertainment spaces. Gyms, training centers, children interactive zones and more are being prioritized over general retail sites as they provide long-term attractions to large scale commercial developments that are insulated against the growing trends of online sales growth. As technology continues to grow and evolve these experience centers will also be able to more easily adapt and incorporate new customer experiences, as seen in the rise of fully immersive virtual reality (VR) providers in many locations providing entertainment for children and adults alike.
At the end of the day the primary goal for any mall developer is to find a tenant that not only will bring in new crowds regularly by have a lasting business model to enable long-term collaboration between a mall and a company for years to come. To that end, service and experience is beginning to dominate the market more and more as an ever-increasing number of retail stores close with each passing year. While this does not necessarily mean that stores will ever be fully phased out of mall space as there will always be a need for physical offline goods sales, increasingly diverse offerings are ever growing as a key interest point for mall managers worldwide.
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For further information please contact,
Praveen Rao
Regional Marketing Director
EDGcompany
Tel: +86 (21) 6103 6718
Email:praveen.rao@edgasiapacific.com
Web: www.edgcompany.com(English)
