Over the decades shopping centers have evolved many times. From size, focus, style shopping centers are a reflection of society, the economic times, and the composition of the stores themselves. Ever since the first civilizations built cities and towns, the congregation of merchants peddling their goods was largely based on transportation and how people move. Whether it was alongside a waterway or a caravan route early retailers found it more successful to gather together to offer greater selection to their patrons. The early shopping meccas, bazaars, mercados, relied on that same formula of success throughout the millennia, at least until the internet came along!
There was one fundamental major change that occurred even before the current sea change happening right now with the internet. That big change centered around the automobile and the advent of suburbia. With the advent of the automobile and the resultant sprawling suburbia people didn’t need to live near the city center nor depend as much on trains and streetcars . Downtowns were becoming irrelevant and a new style of ‘shopping centers’ were popping up, ones with big parking lots.
Then in the mid 1950’s the first enclosed malls were being constructed, here again capitalizing on the further growth of suburbia. Developers were trying to recreate the downtown retail scene in a controlled environment where people were now living. As the economy prospered so did the oppulance of the mall. When the economy became more strained we saw the advent of outlet malls and discounters. Traditional downtowns, particularly smaller towns in the heartland, suffered another blow named “Walmart”. Just about every small business would suffer when Walmart came to town. Along with the advent of the big discounters came the “big box” stores, generally starting in the 70’s and ramping up in the 1980’s. The same theory of big selection, low prices and lower level of personal service that the Kmart, Target and Walmart applied with general merchandize now was applied to home improvements, pet supplies, electronics, office supplies, etc. Those stores grew larger and larger and soon they began to congregate into their own shopping centers, now called ‘power centers’. Power centers were the darlings of the industry starting in the 80’s and 90’s.
As prosperity continued to grow in the late 1990’s and early 2000’s, another throw back change in retail started to gain strength. The growth of the ‘lifestyle’ center, also called specialty centers and mixed use centers. They helped fill the needs of consumers to reconnect with their desires for a sense of place rather than just a place to buy staples. Generally these new properties took the form of large entertainment venues and were often akin to an outdoor mall.
The next tidal wave of sea change started as a ripple in the 90’s and is now becoming a real tidal wave. Leading that charge is Amazon. The internet has left many early casualties, including video stores, travel agencies, greeting card stores. The big box stores are rapidly trying to readjust their ‘brick and mortar’ strategy simultaneously while building their internet sales strategies. The effects of this assault on shopping centers is going to have several implications moving forward. The smaller strip shopping centers are going to modify their focus to be driven by restaurants, medical, and service business and less general retail. Big box centers are going to be subject to perhaps greater risk as the big box stores generally try to resize. The large regional malls, which have had fairly flat, but stable, performance over the past couple of decades will have to continue to find retailers that are able to reinvent themselves as the internet continues to encroach on traditional retail.