Shopping centers fighting the rise of online retailers are unpacking a bag of tricks this holiday season to keep customers coming through the doors.
Weary of navigating packed parking lots and elbow-to-elbow crowds, consumers increasingly have been turning to the Web. So malls are super-sizing attractions or services to entice shoppers off the couch and into stores.
Some are rolling out souped-up Santa houses. Others are offering free same-day delivery. A few are even paying to ferry high-roller shoppers to and from their homes.
“You need more of these gimmicks in order to get physical shoppers through the doors,” said Lindsey Piegza, chief economist at Sterne Agee. “It’s very important for malls and department stores — you spend more if you are physically in the store versus when you buy online.”
Shopping centers are feeling the pressure this year.
The National Retail Federation forecasted spending will jump a healthy 4.1% to $617 billion in November and December, compared with a 3.1% rise last year. But the average consumer is estimated to do a record 44% of her shopping on the Web, up from nearly 39% two years ago, according to the trade group.
Analysts say malls are fighting an uphill battle to woo consumers who increasingly turn to the Web for gift buying.
In 2001, nearly 40% of American consumers browsed through shopping centers every month, said Britt Beemer, founder of America’s Research Group. Today, only about 20% do so.
“Malls are lucky to get that number up to 23% between November and December,” Beemer said. “They have got to rethink because they are losing their shoppers.”
To attract kids and their wallet-toting parents, some centers are upgrading the Santa experience beyond twinkly lights and a bearded man who chortles “Ho ho ho.”
Victoria Gardens in Rancho Cucamonga and Glendale Galleria debuted an interactive Santa house. Forget gingerbread. Walls are mostly made of LED panels displaying animated falling snow and characters from the blockbuster “Shrek” movies waving from windows.
There are no lines outside the red-roofed house. Instead, parents book reservations via a smartphone app or on the malls’ websites.
Inside, perky guides in plaid lead groups through a journey to Saint Nick. Customers design their own sleigh on iPads at the “top secret” design lab before settling in to ride red velvet seats on a virtual trip to Santa’s lair.
To heighten the experience, the seats shake on takeoff and later as fireworks burst in the sky. Shrek and his pal Donkey make appearances on the huge screen before the sleigh lands at the North Pole.
Later on Santa’s lap, photos and a video are taken. The trip ends in a gift shop reminiscent of the ride-retail mash-up found at Disneyland and other theme parks.
Melina Ferraez, director of marketing at Victoria Gardens, said malls must work hard to attract shoppers during the crucial gift-buying period at year’s end.
“Shopping centers have to step it up and see what else we can offer besides shopping,” she said. “Online shoppers are not getting an experience like this.”
Lakewood Center rolled out its own Santa house with an augmented reality component and stations to take selfie photos. The idea is to cater to tech-savvy kids as a way to draw out the entire family during the holidays.
“Children coming through go immediately to the tablets,” said Nicole Flynn, assistant vice president of marketing at Macerich Co., which operates Lakewood. “I saw a little one who couldn’t even talk yet, and he was posing for a selfie.”
Some shopping centers are using technology to make the holiday buying madness as painless as possible.
Glendale Galleria partnered with tech start-up Deliv to offer free same-day delivery to shoppers through the end of 2014. Deliv is also offering same-day delivery at four other Southern California malls, including Beverly Center and Santa Monica Place (although these two charge a flat $5 fee).
Customers can shop and then leave their packages to be gift-wrapped and delivered to the address of their choosing later that day, said Christina Riojas, Glendale Galleria’s marketing manager. Deliv also stations workers at each mall who will approach shoppers toting bags and offer the service to them.
“This allows shoppers to come in, make a purchase and not have to deal with carrying bags,” she said. “They don’t have to go home and hide their presents and come out in the middle of the night to wrap them.”
For the first time, mall staff will also answer any questions customers have via text. Riojas said queries have included “How do I get to Macy’s?” and “Any suggestions for gifts for my wife?”
Even upscale malls catering to more affluent shoppers are rolling out the red carpet.
Through Christmas Eve, the Grove and the Americana at Brand are offering complimentary rides to and from the shopping centers for customers who spend more than $450. Customers can book a ride through the app from start-up Uber, using a special promotional code, or by calling a concierge at the malls.
“We pick up guests in a very nice car and make life easier for you,” said Rick Caruso, the magnate behind the Grove and the Americana.
He said the Uber offer builds on existing services provided by the Grove, in Los Angeles’ Fairfax district, and the Americana, in Glendale.
“If I owned an indoor mall I would be living in panic and fear and I would be picking them up myself to drive to the mall,” he said. But “this is not about being concerned with online and driving traffic. This is about making it an even better experience.”