Posts Tagged 'Mall of America'

Reflecting on the impact of IKEA

Most of the obituaries of IKEA’s recently deceased founder focused on his background, but RetailWire panelists reflected instead on what the store’s operating model has meant to the world of retail. Here are my thoughts on IKEA’s impact and the store experience:

IKEA revolutionized furniture and home furnishings retailing in several ways. It developed a low-cost operating and sourcing culture that passed along savings to its customers, developing an almost cult-like global reputation in the process. For all the jokes about the difficulty of assembling IKEA furniture, there is no doubt that millions of customers own home furnishings of decent quality that would once have been out of reach.

As to the in-store experience, I shopped the IKEA at the Mall of America last summer and it seemed noticeably easier to navigate than I remembered. (And yet I worked my way through the entire store.) Maybe IKEA has taken seriously the critique that its shoppers are like lab mice lost in a maze.

And yes to the meatballs…but don’t miss the lingonberry preserves near the checkout lanes!

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Does every airport need to be a mall?

RetailWire panelists commented recently on the trend toward ever more elaborate shopping facilities at airports — especially those with robust duty-free sales. I’m a skeptic about whether this is really a priority, vs. ensuring that airports are safe and efficient transfer points:

I’d be happy if airports like LaGuardia focus on upgrading their cramped facilities, restrooms, overcrowded TSA checkpoints and even places to eat (hello, Auntie Anne’s) before trying to recreate themselves in the image of Heathrow or the Mall of America. Many of our airports have enough infrastructure challenges on their plates without worrying about whether they are world-class shopping venues.

I flew through Heathrow a few years ago, and the process of transferring from an arriving flight from Madrid to a U.S.-bound connecting flight took far longer than any similar experience in this country. Between the bus ride from the tarmac to the terminal and then going through two separate (and lengthy) security checkpoints (after doing the same thing in Madrid), most of our two-hour layover was wasted with very little time left to shop in the fancy new BA terminal. Maybe things have improved, but you get my point: First things first.

Do Macy’s problems foretell the “death of the department store”?

…or is it just plain bad execution? (A recent visit to Macy’s huge anchor at the Mall of America would suggest so; it was a mess.) Here’s my opinion as posted recently on RetailWire:

Macy’s sales problems didn’t start in the fourth quarter; their same-store trend has been flat to down for awhile. While I agree that the store closings and layoffs will trim some fat from their operating model, what drives Macy’s is top-line sales.

The company is dealing with a stale promotional platform and an increasingly confused point of view in its merchandise assortments. At the same time, its service standards are challenged by the re-engineering of its brick-and-mortar stores to be omnichannel fulfillment centers.

Until Macy’s addresses these issues (all central to its brand identity), the expense cuts and the rollout of its off-price strategy are likely to produce only marginal improvements.

New growth plan for the Mall of America

A timely discussion last Monday about expansion plans at the Mall of America, outside Minneapolis. (Timely because I was headed to the mall on the same day.) The plan is to expand dramatically by adding a “luxury” wing, and the question before RetailWire panelists is whether the MOA is following a theme-park strategy by drawing shoppers. Here’s my take:

The MOA (which I happen to be visiting today) has long had an “attraction” strategy, going back to its theme park in the middle, amusements like an aquarium, and a vast array of shops and restaurants pulling tourists and shoppers from all over the world.

The latest plan is interesting because the Mall began as too upscale for the market and changed its tenant mix at least 15 years ago before hitting its stride. The new plan is a logical evolution, especially since the MOA in its current incarnation runs the risk of becoming stale.

New impressions of the Microsoft Store

I visited the Microsoft Store at the Mall of America, a couple of months after commenting about it on RetailWire. (I have also made it a study topic for the undergraduate class in retailing management that I teach.) While the store had good foot traffic (not surprising the week after Christmas at the MOA), it suffered from the “identity crisis” that many of us predicted last fall. What, exactly, does Microsoft stand for other than a software supplier for other brands’ hardware? The store was dominated by “demonstration” spaces (like an Apple store) where customers can try out laptops and other equipment. But some of Microsoft’s proprietary “wins” (Xbox Kinect and the new Windows phone software) seemed curiously underplayed. Understanding that this is a work in progress, there is plenty of thinking to be done especially in contrast to the Apple Store next door.


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