Physical presence is a marketing tool. It is a theater in which retailers can create a immersive experience for their customers.
By Joseph F. Coradino
Coradino: "Malls will adapt their model to satisfy modern consumers preferences.
As consumers learn how to manage increasing prices due to inflation, one thing is certain: Top-quality regional malls remain the best places for digitally native brands, local retailers, and new dining concepts to connect with new customers and strengthen relationships with existing ones. In-person shopping is an experience that cannot be replicated online.
It is a tactile experience that gives consumers the opportunity to touch, feel, and try on products before purchasing them.
It is a visual and social experience in which shoppers are enticed by store displays and can engage with knowledgeable associates.
It is a living platform upon which retailers and restaurateurs create holistic experiences that encourage loyalty.
As we continue to experience consolidation among retail real estate venues and as weaker malls and shopping centers are repurposed, there is a new calling for the strongest brands to join the strongest centers and maximize foot traffic and sales. Among them are savvy, digitally native brands looking to build physical retail presences or expand their the ones they’ve forged, as well as local and regional merchants who see malls as the best way maximize exposure for their growing businesses.
Digitally native brands can benefit from opening brick-and-mortar locations as it allows them to connect with their customers on a more personal level. Physical presence is a marketing tool. It is a theater in which retailers can create a immersive experience for their customers. As an alternative to managing inventory across a store network, digitally native brands can use their physical locations as showrooms where customers can see test products and sizes before purchasing them.
Rather than using algorithms to control where their message is appearing and guessing who will be receptive to it, they can take advantage of passersby and use real-life engagement strategies to connect with customers. Some of the more well-known retailers increasing their offline presence include allbirds, Bonobos, AdoreMe, Casper, Purple, Glossier, Parachute, Untuckit,. and more. Typically choosing to locate in best-in-market, dominant centers where they know their customers are, Warby Parker, Peloton and Purple are tenants in our Cherry Hill Mall outside of Philadelphia.
Local retailers looking for larger audiences, too, see their brands bunished when surrounded by quality co-tenants in top-tier destinations. These merchants not only introduce their products to new audiences, but gain cachet as neighbors of heralded brands. Many of PREIT’s properties have seen an increase in best-in-class local tenants when closures of competitive properties fully established them as the market-dominant properties.
National brands, in turn, benefit from a stream of new traffic made up of long and loyal customers of the local brands. One property that stands out with a significant presence of local retail is Moorestown Mall, which boasts unique local brands in addition to a broad range of traditional and off-price retail, dining, and entertainment destinations.
Good malls retain the power to attract customers by offering a distinctive mix of places to shop, great food options and fun things to do. In PREIT’s portfolio, even as customers pull back amid rising costs, sales through February were up nearly 2% over December results and traffic is up more than 7% compared to last year. Three of our properties yielded better results than they did in 2019.
The most successful malls will continue to adapt their model to satisfy modern consumers as their preferences shift. They are engaging them with expanded events and marketing strategies that shine a new light on them as the best option for restaurants, retail brands, and new entertainment that, likewise, are refashioning themselves for a new generation of customers.
Joseph F. Coradino is the chairman and CEO of Philadelphia-based PREIT.