South Coast Plaza’s New Cross-Street Neighbor Faces Marketing Test
The project is still seven months from completion, and already it has had three names.
South Coast Plaza II. The Bear Street Collection at South Coast Plaza. And now, South Coast Plaza Retail Complex.
Whatever it is eventually called, the $80-million retail mall rapidly taking shape across the street from South Coast Plaza in Costa Mesa has evolved into a difficult marketing chore for its developers.
Retail industry executives and consultants speculate that the developers are having trouble naming the three-level mall because they are uncertain about how to position it in the market. After all, the owner-developers--C. J. Segerstrom & Sons of Costa Mesa and California Pacific Properties of Santa Ana, a minority partner in the joint venture--now must keep tenants and consumers content on two sides of the street: a real street, one that divides the complex.
Warned one executive at at rival mall: “It will be a real test for them.”
While reluctant to discuss marketing strategy until a planned advertising campaign breaks in June--two months before the mall’s scheduled August 23 opening--Henry Segerstrom, partner in C. J. Segerstrom & Sons, says the two malls will be viewed as one. “It is all one center. We are a single retail concentration.”
The new mall “will be a part of South Coast Plaza, just as if we had added a new wing,” said James Hietbrink, co-partner at California Pacific Associates. Both Hietbrink and his partner, Gregory Butcher, are former employees of Segerstrom.
But once the new mall opens, the owners will have to change the traffic patterns of tens of thousands of South Coast Plaza visitors. They are working on a major campaign to familiarize shoppers with how to get from the existing mall to the new one.
Developers are reluctant to discuss it publicly, but they also hope to improve upon the few weaknesses at the existing South Coast Plaza. For example, retail consultants say, there is a lack of exciting restaurants at the current mall. But a number of bright, cafe-like restaurants--flooded with natural skylight--are planned for a court in the new mall’s entrance.
Six months from now, it will be a very different South Coast Plaza.
Nearly eight years after its last major addition, the center is almost doubling its size. When the expansion is completed, the retail complex will measure 2.9 million square feet, compared to the current 1.8 million. It also will rank as the largest retail mall in Southern California; Del Amo Fashion Center in Torrance will fall into second place with 2.65 million square feet of retail space.
With its size doubled, South Coast’s sales also are expected to rocket. By 1987, sales at the complex will likely dwarf those of Del Amo and of a competitor closer at hand--Fashion Island in Newport Beach.
South Coast Plaza posted sales of $450 million in 1985, compared to $400 million at Del Amo and $200 million at Fashion Island.
By 1987, South Coast Plaza should post annual sales of $735 million, according to a study by Wallace & Steichen, a Palo Alto-based retailing consulting firm.
Few retailers have expressed doubts that the mall will meet anything short of success, but some wonder if developers have been short-sighted in their decision not to physically link the two malls.
With little room to spare in South Coast Plaza’s cramped parking lot, the second mall is being built across a busy street from the main center
Although the developers have not ruled out the possibility of eventually building some sort of connecting bridge, they say they want to wait and see how the pedestrian traffic flow develops before building such a costly structure.
While retail consultants and competitors generally applaud the 60-store project--to be anchored by flagship stores of both the Broadway and Robinson’s--there is concern over how developers will convince wary shoppers to crisscross from one mall to the other.
“We are relying on the willingness of people to park their cars and walk back and forth,” Butcher said.
But Bart Brown, vice president and retail specialist at Coldwell Banker’s Anaheim office, says that may be impractical. “Given the distance between the two malls, if I were the Segerstrom’s, I’d try to connect them.”
Indeed, history may show that a bridge should be built. The lack of a physical connection between South Coast Plaza and its customer-hungry sibling across Sunflower Ave., South Coast Village, may account for years of problems at the Village, said Kathleen Lauren, marketing manager at Fashion Island.
If the bridge between the two South Coast Plaza malls is ever built, it would not be the Southland’s first retail mall to be linked with another. In a bid to bolster revenue, Del Amo built a shop-lined bridge in 1981 to connect its two separated malls, said Brandace Berger, marketing vice president at Torrance Co., which owns Del Amo.
While South Coast Plaza’s developers ponder the situation, they intend to test some sort of shuttle bus service between the two halves of their mall.
But some industry specialists say the key to success is not how the two malls are connected but the quality of the tenants they house. “South Coast Plaza is such a powerhouse that it can’t help but draw top tenants,” Coldwell Banker’s Brown said.
