Imagine the last time you popped into a shopping mall. Odds are, you don't go nearly as frequently as you used to, or perhaps you were never really into them at all.
Still the image you've got of your local shopping mall probably isn't the most positive one. What words come to mind when you picture it? Odds are, "revival," and "brand new," aren't in the list of your top five.
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The reason for the rapid decline of the shopping mall is multi pronged. Malls often charge retailers outsized rents for the privilege of a high-foot traffic location, where potential customers might pop by a store they wouldn't otherwise simply because it's there in front of them. But high rent has become untenable in recent years, and even the largest mall retailers like Macy's (M) recently announced it would close 150 stores across the United States by 2026.
Malls were also deal an outsized hit by the early 2020s as covid forced many states to implement lockdowns and social distancing orders, further accelerating the decline of high density shopping areas.
And while covid may have quickened the decline of the American shopping mall, the rise of online shopping, whereby customers can easily access millions of SKUs from the comfort of their home (often at deeper discounts by easily comparing prices across multiple websites) really put the nail in the coffin.
It's been a long time since malls saw their heyday. In the 1980s, there were approximately 2,500 malls across the U.S. Now, that number has dwindled to just 700.
Top mall retailer looks for a resurgence
Understandably, the malls and retailers that remain are looking for some sort of lifeboat.
Especially as off-mall giants like TJX's (TJX) Marshalls, TJ Maxx, and HomeGoods continue to thrive by offering deeper discounts on brand names, those who remain in the mall need some way to stay relevant.
Upscale mall flagship retailer Nordstrom (JWN) is seeking to do just that, by bringing back its namesake label in the hopes of tempting customers back through its doors.
On Monday, Nordstrom announced it would "reimagine," its old Nordstrom brand to bring back high-quality wardrobe staples to be sold in stores and online beginning March 18. The brand will carry tailored and minimalistic staples, mostly in neutral tones such as "ivory birch, tan travertine, white and black with hints of soft, seasonal colors."
Some of the items featured in the forthcoming line include:
- Oversized blazers
- Cropped jackets
- Tailored pants
- Sleek dresses
- Bold patterned sets
Nordstrom says the line will also feature some shoes with sleek designs, plus some tasteful hardware and more streamlined silhouettes. Pricing for its items will range from $29.50-$179 and will be available in sizes XXS-XXL.
But Nordstrom isn't going all-or-nothing on its mall operations. Its off-mall discount retailer which competes more directly with the TJX brands, Nordstrom Rack, has actually been the outperforming beacon that management remains optimistic about. It opened 19 new stores in 2023 and management called the stores an "excellent investment," in its Q4 earnings call earlier in March.
Nordstrom Rack sales were up over 14% in Q4 and comparable store sales grew by high single digits, management said. Nordstrom intends to continue investing in Nordstrom Rack in 2024, with new store openings planned later this year.
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