Several malls across the United States have been struggling to attract consumers as many of them have transitioned over to online shopping. According to a report from Credit Suisse, almost 25 percent of the nation’s malls will close by 2022 if the current pace of retail bankruptcies, store closures, and increased online shopping continues. What this means is that about 275 malls will close over the next five years in the United States. Phil Lempert, a Santa Monica based expert on consumer behavior and marketing trends, stated:
Consumers have changed, with online shopping there’s no need to go to the mall. All you have to do is get on your mobile device.
2,056 retail stores were closed last year and the report is predicting that 8,640 retail stores will close this year. Credit Suisse claims that e-commerce will grow from 17 percent of industry sales to 35 percent or more by 2030 as retail stores continue to struggle.
While some malls have struggled to attract consumers, other malls have actually been lucky enough to remain stable thanks to reinvention. For example, the Irvine Co. owns and operates the Irvine Spectrum Center in Irvine, Fashion Island in Newport Beach and The Market Place in Tustin and all three malls have been doing well. Dave Moore, president of retail properties for The Irvine Co., stated:
In order to remain successful, shopping centers will need to continue to evolve as we have done and strive to do with our centers. We attribute the success of our centers to a variety of factors, not the least of which is that we constantly strive to create lifestyle destinations for our guests.
It certainly is sad news to hear about the retail store closures, but hopefully things can be learned from the model that more successful companies have taken to avoid more closures.
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