What Can Malls Learn From Disney World?
The Mall Of America in Bloomington, MN, already one of the largest malls in the U.S. at 4.2 million square feet, plans to add up to another 5.6 million square feet to make it even more of a tourist attraction, particularly for high-end spenders.
The expansion, according to Mall of America’s website, will add:
- A 20,000 square foot event space to host community events, celebrity appearances and more;
- Up to 8,000 additional parking spaces;
- Unique lodging options such as boutique, business, family and premium hotels;
- Museum-quality exhibit space for booking popular traveling exhibits, including one coming for Princess Diana;
- The state’s largest water park and an NHL-sized indoor skating rink;
- Nightlife, entertainment options, and state-of-the-art movie theaters.
"The overarching goal is to always keep the attraction fresh and continue to enhance it," Maureen Bausch, Mall of America’s executive vice president, told the Pioneer Press. "That’s what Disney and all the great attractions do. You never keep it the same."
The expansion is expected to particularly attract additional upscale customers with an estimated annual household income of more than $100,000, as well as families with older children, according to Mall of America’s website.
The Pioneer Press said the mall has become a shopping destination for wealthy tourists from Asia and Europe. International visitors have been known to spend up to 2.5 times more than domestic shoppers.
Beyond a focus on luxury boutiques, upscale additions include spas and a wellness center, valet parking, and a second luxury hotel to join the Radisson Blu hotel, which opened this past spring. In the existing mall, the food court will be replaced with an upscale food hall, skylights will be added to the corridor, and the carpet removed as part of an overall streamlining the overall design.
"The philosophy of designers has changed," Ms. Bausch told the Pioneer Press. "In 1990, it was all about ‘theming,’ so people knew where they were. … Now the school of thought is, you give them a white palate, a canvas, and you let the retailers provide the color."
Phase 2, which is expected to cost about $2.5 billion in total and take ten years to complete, is expected to draw up to an additional 20 million visitors annually — nearly 60 percent from outside 150 miles.
With 40 million annual visitors annually, Mall Of America claims to already be the country’s second most-visited tourist attraction after Florida’s Walt Disney World
Discussion Questions
Do you see parallels between Mall of America’s “attraction” strategy and that of Disney? What can smaller regional malls borrow from the Mall of America to draw bigger crowds? Do other mall properties have the potential to position themselves as tourist destinations?
I think (if Wikipedia is right) this expansion will rocket the Mall of America to the #1 spot in mall size, jumping ahead of King of Prussia, which is currently #1.
When it comes to traffic generation, I would just like to say one thing—which was originally brought to my attention by Greg Buzek of IHL Group. Disney (being used here as the ‘standard’) has approximately 125,000,000 visitors to its theme parks in 2011. The Apple Stores? In 2012, they saw 370,000,000 visitors.
That sort of tells you that it’s not about quantity. It’s about experience quality. Otherwise it’s just a lot of stores in an enclosed space, so people have a place to go in inclement weather.
The MOA (which I happen to be visiting today) has long had an “attraction” strategy, going back to its theme park in the middle, amusements like an aquarium, and a vast array of shops and restaurants pulling tourists and shoppers from all over the world.
The latest plan is interesting because the Mall began as too upscale for the market and changed its tenant mix at least 15 years ago before hitting its stride. The new plan is a logical evolution.
Shopping malls of the ’60s and ’70s are dead. They need a new life. Better said, they need a different life. As my wife often says when shopping online, “why do I have to go to a store?” (My response of course, is it will save us money because online makes a purchase so much easier.)
As online continues to grow and if you can buy most everything you want online with more choice and efficiency, why would you go to a mall?
How about for:
(How about adding mass transit? Do I really want to deal with 8,000 more cars?)
Most malls are stuck in a “boring” mode for most customers — just a collection of stores; some great, some average, some just plain bad.
What MOA is doing is brilliant. Retail has to be more than about the product; it has to evolve to include an amazing experience, and that’s what MOA is moving to provide.
No doubt their attraction strategy will work to pull in many, many more customers. The question is: Will the retailers inside the mall keep up by upping their own game?
An interesting thought is whether it’s a Mall or tourist attraction. I think Mall of America is more of a tourist destination and has the activities to entice the consumer. Shopping is almost secondary in the consumer’s mind when heading to the Mall and maybe that’s a good thing.
Smaller malls may have already adopted some the of the destination ideas with better dining options, bars and entertainment.
I am having a problem seeing where the traffic will justify the expansion, especially during the cold weather months, other than December.
Having recently been to Disney (and scheduled to go to Euro Disney soon), I have learned one thing: we parents will really do anything for our kids! Disney is expensive for the average parent and yet we flock there. Once we are there, do we just hop on rides? No! We wait in line because there are thousands of other parents who also love their kids!
I would be cautions to extrapolate this model too far without the instinctual emotional attachment we have for our children. A mall may be big and fancy but it cannot be reasonably compared to Disney unless it really taps into that emotional connection we have with loved ones.
There are absolutely parallels between malls in general, not just Mall of America, and Disney. Successful (discretionary) retail has always included an element of entertainment. Given how many retailers are becoming commoditized, or at least selling the same goods, shopping centers have to compete for shoppers, for merchants and for enhancements (hotels, restaurants, etc.).
At the same time, Mall of America’s focus on tourism underscores a growing trend: as wealth expands outside of the US and as ecommerce becomes more global, transient international shoppers are increasingly important, especially where there is a major airport hub such as MSP.
Of course—it is a fun place to spend time with friends and family! The attraction is the very high expectation of a great experience for all, and those expectations are well met, making the cost of the excursion easier to justify.
Key to becoming a destination is having the kind of attractions for “children of all ages” that will delight them—a major investment in a tough economy. For northern malls, having a bright happy place to spend your time is a real draw in cold weather months. Possibilities are wide ranging, a chance to strongly differentiate and engage visitors can create the traffic and hopefully, many return visits.
I wish them well in their upscale strategy, but considering that the Bloomingdale’s there just closed, and the Neiman Marcus on Nicolet Mall nearby also just closed, I’m dubious the area can support so much high-end.
Anyway, what applicability does this have to smaller malls? As for the general idea of being an “attraction” as opposed to simply being a shopping center, yes (though be careful the various components are compatible…skate parks and gourmet foods probably don’t mix). As for the specifics—let’s be honest—the borrowing will be nil: how many malls—even very large ones—are in the position to add a luxury hotel, water park or celebrity museum?
There exists a clear division between attraction retailing and consumer-oriented shopping retailing. Where will the customer choose to shop if they know exactly what they need, what size, and how much they expect to pay, as well as don’t want to walk a mile from the parking lot to the store, or take a shuttle bus, etc., etc., versus the browser who has lots of spare time and is ‘just looking’?
Mall of America always was a destination attraction. I visited from Chicago, but never saw any different stores than I’d see at home…except for those in the theme park.
This is a true destination center catering to tourists, especially high spending, international visitors from China and other core spending markets. There can’t be too many of these (and there aren’t). The way to continue attracting high spending tourists and keep others from competing is to continually refresh the offer, both retail and other (dining, entertainment, etc.). MOA is doing exactly what they must do to position the property to take advantage of the ongoing growth in Chinese and other regional and international high-spending tourist groups.