August 21, 2014
By Hank Schlesinger
Demographics is destiny in retailing, and this truism is being demonstrated by contemporary shopping centers. According to recent reports, one of the fastest-growing trends in malls and shopping centers is the Latino-centric experience. Stories foreseeing the demise of the American shopping mall may have been exaggerated, at least in some parts of the country. From Florida up through much of the Southwest to California, malls that were recently in serious decline are now filled with tenants and shoppers.
For bulk vending and amusement operators, this trend holds promise for revitalizing moribund routes.
The newly renovated malls catering to Latino consumers typically boast a mix of large, brand-name corporate tenants such as Western Union, Metro PCS and Burlington Coat Factory, with small businesses including restaurants and specialty food, clothing and toy stores. Often featuring Latin American decor, most of the retailers employ bilingual staff.
New Life For Failing Malls
One of the leaders in the field is the Legaspi Co. (Montebello, CA), a full-service retail real estate firm that focuses on the Hispanic market. Founded by Mexican-American businessman José de Jesús Legaspi, the company currently owns seven malls that it has worked to reposition or redevelop as predominantly Hispanic. These include two in California, the Panorama Mall (Panorama City) and the Pacific View Mall (Ventura). Legaspi also has the Desert Sky Mall in Phoenix, and two malls in Texas: La Gran Plaza (Fort Worth) and PlazAmericas (Houston). There is also the Plaza Fiesta Mall in Atlanta, and Plaza Mayor in Oklahoma City, OK.
According to Legaspi, the Latin trend began about 15 years ago and has been picking up steam over the past 11 years. However, marketing to the growing Latino community is not as easy as it may look. Declining malls and shopping centers often, if not always, require a full, well-planned makeover that goes far beyond freshening up the overall decor.
"We take into consideration the demographic and psychographic characteristics of the client base in doing the architectural renovation, as well as the events that we may do weekly, or a big event throughout the year," Legaspi explained. "Design work takes into account the young demographic base and builds to the family, with the average age of the Hispanic community and their social interaction among themselves and the community."
Mi Tienda Es Su Tienda
For amusement and vending operators wishing to locate equipment in these new malls, it means fitting in with the new décor and addressing the targeted consumer base. Some of the characteristics common to the old-style malls are missing from these new ones. For instance, so-called "mall rats" -- disaffected loitering teens -- no longer factor into the calculations.
"Malls should be community oriented, with a program that would give families a reason to go to the malls besides shopping," Legaspi said. "Latino shoppers tend to be extended-family oriented and look for ambient programming. Going to the mall is an event, not a pragmatic reason for purchasing what is needed."
Notable among the features of the growing number of Latino-themed malls and shopping centers is an experience that cannot be enjoyed on the Internet. This includes a wide variety of family-oriented attractions, live entertainment and other in-person amenities. The overriding theme is family, particularly young children.
As a recent Wall Street Journal story noted, Latinos accounted for more than half the population growth between 2000 and 2011; have more children than non-Hispanics; and are very quickly moving up the socioeconomic ladder. In short, they are rapidly trending toward a high-value consumer demographic.
It has not been entirely smooth sailing for the new malls. There has been some pushback in some parts of the country in response to the trend. When the struggling Osceola Square Mall in Kissimmee, FL, recently became the Plaza del Sol, some local residents were less than thrilled. Despite the fact that the shopping hub had been in decline for several years, the Latino revitalization drew some sharp criticism. Negative social media comments ranged from the bewildered to the overtly xenophobic.
Some of the malls that have experienced dramatic revitalization were besieged with double-digit vacancy rates, coupled with an increasing unappealing shopping experience caused by the lack of basic repairs. In many instances, tightening budgets had necessitated cuts of essential personnel and postponed needed maintenance, sometimes to an alarming degree.
Spreading The Word
Retailers have taken notice. The International Council of Shopping Centers Inc. has been sponsoring multiple events focusing on the burgeoning Latino market, while consultants to the retail industry have been churning out white papers and statistical studies, and hosting PowerPoint-heavy seminars on the topic.
For bulk vending and amusement operators, the opportunities are unprecedented. Although these industries were early adopters of Latino-themed merchandise, few have yet entered the marketplace fully. "Families with children especially appreciate kiddie rides and other family-oriented services," said Legaspi. "They do extremely well in Hispanic-oriented malls."
Source: Vending Times