Out with the old, in with the new
Most retail historians have acknowledged Victor Gruen as the architect of the ‘mall’, with the first of his realised developments being opened at Southdale Minnesota, USA in 1956. While some argue the true inspiration for shopping centres lies in the great Victorian era department stores, Gruen’s personal inspiration came from the central shopping districts of the European cities that he lived in and visited as a young man. In truth, Gruen’s detailed vision for a modern mall that re-created the European town centre – in all its diversity, complexity and richness – under one climate-controlled roof, was never fully realised.
Gruen wanted to combine places to live, work, shop, learn, eat, be entertained, socialise, receive medical treatment, be cared for with access services, exercise and more, in the ultimately convenient, truly connected ‘micro-town’. While contemporary malls in places like Hong Kong have come close to the vision, the model laid down by Southdale was always flawed. Yet, it became the template for mall developments for the next 60 years globally.
As in all areas of commercial endeavours in this era, the second half of the 20th century saw retail developers simplify and systemise shopping centres into cookie cutter formulae that were easy to create, fund and rollout – everywhere. The common ‘H’ pattern mall with two majors at either end of a ‘gun-barrel’ run of specialty retailers – and majors secured under ridiculously lucrative, long term rental deals in return for their signatures as perceived ‘under-writing assets’ – became the norm. This model spawned the over-expansion of department stores into suburban and regional areas as supposed ‘foot traffic drivers’ and encouraged the dumbing down of catchment area customer profile matching in favour of developer rollout and re-development logistics efficiency. Shopping centre management was also dumbed down to real estate management principles.
In the context confronting us in the retail landscape of the 21st century, this old model is being exposed as flawed and unsustainable. The newly emerging model is far closer to the model Gordon Selfridge originally penned for Selfridges. It involves active management of the shopping environment and everything in it. It sees food – in all its guises – as the cause of footfall frequency, if not footfall volume as well. It truly combines all elements of both Gruen’s and Selfridge’s vision into an interconnected mix that fits the needs and desires of the shopper.
It requires tailoring to every different catchment area, rather than cookie cutter or over-development, in order to deliver superior returns. It reverses the lazy over-investment in department stores as universal ‘anchors’. And above all, it changes the dialogue between concession partners (the new view of tenants) and shopping centre management to agree and realise mutual prosperity for the long haul, based on delivering the most productive physical customer experience possible to meet the shopper’s ever-changing point in time requirements.
The new model is already emerging. The handbrake to its rapid adoption is the amount of capital – both human and financial – that is required to make it happen fast enough to contain the surrendering of territory to virtual retail. This requires the goodwill and vision of everyone involved in the retail mix because the best distribution ‘hubs’ possible in the real world that are confronting us are great shopping centres – albeit with omni-channel tentacles and enhanced logistics.
Peter James Ryan is head of Red Communication and can be contacted on (02) 9481 7215 or at firstname.lastname@example.org.