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The common myths of retail: the “death” of malls and the retail “apocalypse”

Thursday, Feb 15, 2024

It’s a common myth that the retail industry is “dying” and that the death of malls is near. However, both of those statements couldn’t be farther from the truth, and we’ve got the facts to prove it. 

Retail data and analytics show that consumers are shopping in person. So much so, that retail sales were up 3.2% in 2023 from the previous year.

According to a recent report from analytics firm Coresight Research, the death of malls has been widely exaggerated. 

  • From 2021 to 2022, retail sales at malls increased 11% to over $800 billion.
  • Foot traffic at top-tier malls, where the average shopper makes $200,000+ per year, increased 12% in 2022 compared to 2019.

Brands have figured out that consumers want the best of both worlds. Retailers are investing in an omnichannel approach to drive growth. E-commerce and physical retail now compliment each other, and one cannot exist without the other. Opening a brick-and-mortar store can increase a brand’s online sales, while closing a store has the opposite effect. 

Shopping centers and malls have gotten more diverse, offering medical offices, day care centers, gyms, pickleball, bowling, and other entertainment spots. 

Plus, Gen Z’ers have proved to be loyal shoppers to malls. A survey conducted by the International Council of Shopping Centers found that roughly the same share of Gen Z respondents shopped at brick-and-mortar stores (97%) as online (95%).

Retail space in general is getting harder to find due to the increase in store openings. And 1,000 more stores are expected to open than to close this year.  Retail commercial real estate is “back for good,” according to a recent report from Cushman & Wakefield. 

The demand for retail space stayed strong throughout 2023 due to a growing economy and strong labor market that kept consumers shopping, and will continue throughout the new year. 

Retailers’ ability to meet spending habits, consumer tastes and trends has made this demand evident. This evolution has also created a new-found resilience in the retail landscape after overcoming the recent pandemic. Retail has shown its strength in numbers, and this is an industry that will always come out stronger in the end.

Source: Malls – Morning Brew, Retail – Axios
Photo Credit: Malls – Morning Brew

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