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Is The Mall Lost On The Supermarket? 5 Facts Say No

Once we bought sweaters at the north end of the mall. Now we go there to pick out Swiss chard.

(Photo credit: LOIC VENANCE/AFP/Getty Images)

The rash of department store shutterings this year (more than 300, according to JLL Retail) has resulted in millions of square feet of darkness at the far ends of many U.S. malls. However, these big empty boxes that once stored the spirit of retail’s future are now proving to be the grounds for retail resilience, in the form of vegetables, steaks and frozen four-cheese pizzas. The question is their shelf life.

More supermarkets are signing leases at shopping malls, adding substantial steam to a trend that emerged tentatively a couple years ago. Kroger, Wegmans and Whole Foods are among the big names that have signed leases to fill former Macy’s, J.C. Penney and Sears stores this year.

In doing so, they challenge tradition as well as real estate experts who suggest strip centers make more sense for supermarkets, due to their ability to shoehorn into residential areas and provide designated parking.

However, like displaying pretzels near the beer, several unmistakable opportunities present themselves for grocery retailers that drop into a mall anchor. Here are five, plus one major watch-out.

From Farm to Label: 5 Major Mall Benefits

Easy setup: Most department stores occupy large footprints that suit a supermarket’s need to stretch out. The average full-line Macy’s store, for example, is nearly 191,000 square feet. Most mall anchors cover two stories, which would net out to 95,000 square feet or so per floor — plenty of space for a supermarket. Also, because anchors usually operate at the ends of malls, they have expansive exterior access for delivery trucks, pharmacy drive-thrus and (already existing) entrances for shoppers who want to avoid the mall interior.

Commuter traffic: Malls typically exist on busy commuter routes and within site of highway exits, making it easy for the supermarket shopper to combine trips without going an extra mile or two. The inconvenience of those additional miles should not be underestimated: Nearly 50% of shoppers said they would like to have a supermarket in the mall, according to research by General Growth Properties, a major mall operator. Bonus: Most malls also are located on mass transit lanes, so placing supermarkets among the mix could potentially alleviate the growing issue of food deserts in some areas.

Community ties: Many supermarkets are already testing community-focused features such as live music at in-store restaurants, as well as fitness classes. In a shopping mall, supermarkets would have the opportunity to expand these features through partnerships with other tenants. A merchant that sells baby clothes and related items could offer nutrition classes (for mother and child) in partnership with the supermarket’s dietician. Cooking classes could be co-sponsored with kitchenware chains. And supermarkets can pair with youth-apparel merchants to offer services for students, a la American Eagle Outfitter’s free laundry services near New York University.

Local sourcing: Since many malls are built on what was once farmland, it makes sense to return to the region’s roots, which many locals may remember. A mall-based supermarket could host weekly farmers markets featuring products grown in the region. In fact, they can source the markets super-locally — within sight of the store. Some overseas shopping centers are experimenting with food production on-site. In Shanghai, an indoor farm grows vegetables and raises pigs, and in Tel Aviv, a farm operates on a shopping mall rooftop.

Good PR: An empty anchor store is like a missing front tooth to a mall — it’s hard to ignore, it mars an otherwise nice lineup and it is a harbinger of other extractions. Emotionally, a dark anchor store is, to many in its community, a hulking threat of failure. A supermarket that swoops in has the opportunity to become a beacon of hope. To this end, the store should offer a regular rotation of lively, family-friendly events that will make it a destination as much as a required stop.

And one hazard  parking: This is a key argument for keeping supermarkets in strip malls. There’s a good chance shoppers would be turned off by the thought of having to roll a cart halfway across a parking lot or lug their frozen foods through the mall’s western corridor. To maximize their opportunity at the mall, supermarkets would need to build grocery-schlepping strategies into their operations. Among the options are dedicated parking, curbside pickup or employee “runners” who could bring groceries to customers’ cars. Also, the store interiors should be designed to anticipate shopper needs. Prepared meals could be near the exterior doors, for instance.

One key factor supermarkets should not have to worry about is shoppers. They will adapt to picking up Swiss chard along with plastic hangers and shoes because they’re doing it already, in many open-air malls. Also, many shoppers want to do it. Supermarkets just need to make the experience fast, friction-free and pleasant, like the ideal family dinner.

This article originally appeared in Forbes. Follow me on Facebook and Twitter for more on retail, loyalty and the customer experience. 

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