Brick-and-mortar retailers have been trying to tap into those social lures that can't be easily replicated online. Malls haven't been able to compete with the efficiency of ecommerce, and are using experiences like events and destination restaurants as a differentiator.
Real estate firm Phillips Edison & Company released a set of retail trends at the International Council of Shopping Centers' RECon event in May 2018, and experiential retail, pop-ups, food halls and fast-casual dining made the list of five.
In a Jones Lang LaSalle (JLL) study of malls that have been renovated since 2014, upgrading food and beverage options was the most popular strategy (41.1%). Focusing on entertainment (28.9%) was also a common tactic, while creating open spaces and parks (11.1%) and adding community and kids' spaces (8.9%) were done to a lesser degree.
On the high end, Westfield Century City in Los Angeles spent $1 billion on renovations and opened the first West Coast location of Eataly, the massive Italian food hall. And Oakbrook Center in Illinois upgraded its AMC Theatres to feature reclining seats, in addition to creating a "Village Green" where it screens family-friendly movies outdoors.
The shift to experiential retail follows the money. According to Coresight Research analysis, the share of US consumers' discretionary spending going toward goods declined from 50% in 2000 to 45.3% in 2017. Now, consumers are allocating more dollars to services like dining and entertainment, and by 2023, that growth will translate to $78 billion in spending.
When mall-avoiders were asked by Valassis what would win them over, 59% said better discounts. Offer-seeking behavior aside, 18% did say events and pop-up shops might make them change their tune.