Basil Labs
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Basil Labs

Consumers Are Already Showing Us How Malls Can Evolve

Image from Daniil Kuzelev, Unsplash

By Kriti Verma, Jesse Welch, Cynthia Lu, Nikita Jakkam, Wendy Zhong, Sam Kamau.

In the good ol’ days when Jeff Bezos was just a figment of his parent’s imaginations, shopping was simple — you and your family left the comfort of your car, walked toward the pearly gates, and wowed at the wonder of stores and products that you’d seen in magazines. Now that Bezos is all grown up, the question is:

Will COVID shift consumers permanently online? What is the shopping landscape in the new normal?

We all know the feeling of awkward eye contact as we step around another pedestrian or shopper or hesitate when an oblivious store employee stands too close when answering a question.

Though small, these interactions are representative of larger psychological shifts in consumer behavior — many of which may not be discernable at surface level. Is it time for malls to be repurposed into offices and distribution centers and other uses?

Using tens of thousands of publicly-available data points of malls across the United States, we want to answer the question:

How has consumer behavior changed during COVID?

What have consumers already told us about the evolution of malls?

Image by Author

Methodology

Apart from a cluster of location in the Northeast, our sample of malls was roughly one per state. The sample included 56 malls across 52 cities in 47 states, focusing on reviews of these malls from January 2020 till mid-July 2020.

Consumer Perception Changes

Image by Author

Some topics changed as expected. The emergence of perceptions around Lines and Health and Safety and Cleanliness with a corresponding decrease in topics like Parking and Crowdedness. These and other topics, however, tell a more nuanced story than what appears at first glance.

Overall, we saw 62% fewer reviews in June and July than in a comparable date range from January to February nationally. Malls in our dataset were either all closed or had little to no customers in May 2020; there was a 95% drop in traffic compared to February.

Cleanliness

Given CDC protocols to stay at least 6 feet apart, our team was curious to examine consumer perceptions between indoor and outdoor/partially outdoor malls. We found that while cleanliness was a topic of growing concern, it was far more pronounced among consumers at indoor malls than outdoor ones.

The topic’s overall number of mentions is fascinating — it is a trend our team has observed not only of malls, but many other types of retail locations — cleanliness is usually mentioned in passing alongside other topics more important in the consumer’s mind. Nevertheless, it is mentioned frequently, and its uptick that corresponds with COVID suggests that consumers are certainly more cognizant of the overall cleanliness and appearance of malls and quite possibly using the topic as a placeholder for deeper concerns regarding their health and safety.

Image by Author

Our findings are in line with other studies and are troubling to the industry. A study by FirstInsight found that 32% of respondents feel unsafe or very unsafe when visiting shopping malls in July compared to 29% of respondents in April and a live poll from Today.com indicated that only 4% of respondents are comfortable inside a retail or non-essential store, while 54% prefer staying home.

One of the ways indoor malls are looking to innovate through COVID is the use of pop-up markets. In an article from Forbes, Neil Saunders, the managing director from GlobalData, writes, “Even though it is not a long-term solution, the pop-up is an interesting and innovative concept that I hope will draw more people to the mall.”

Evolving Consumer Experience and Mall Use

Image from K Mitch Hodge,Unsplash

While the downturn in consumer focus around price and product selection tell one story, the rise in dining, particularly with outdoor malls, tells another story. Compared to the average mentions of Outdoor Terrace & Dining and Dining & Drinks prior to 2020, these two topics are seeing significant rises in mentions among outdoor malls.

Image by Author

By analyzing the data through the population density of the metro region (via the Census Urban & Rural Classification dataset), we can see that the trend of outdoor dining is indeed unique to outdoor malls. The metro area analysis reveals a moderate sense of normalcy for malls in metropolitan areas of 1 million population and more — though cleanliness and lines are mentioned more, the number of mentions of dining and drinks has risen back to pre-COVID levels.

Image by Author

Comparatively, metro areas of between 250 thousand and 1 million show sharper increases in mentions of lines and a steep decline in discussion around purchases and product selection/options. Dining and drinks has not risen back to pre-COVID levels as of July. (Note that the number of mentions does not mean there are as many customers dining at these locations as pre-COVID. Since the axis represents a percentage of all topics mentioned, the takeaway here is that customers are mentioning dining and drinks as a similar portion of their experiences as pre-COVID).

Consumers are Showing Us Paths

Malls have long been a staple in the US — whether for hanging out with friends, or spending a day shopping with family, many think of it as a social space to spend the day. While malls face a number of difficulties ranging from closing retail within their locations to looming questions regarding the future of the spaces themselves, our analysis sheds light on how consumers are reacting to the offerings of malls during the pandemic. The perception of cleanliness cannot be ignored, particularly for indoor malls.

Image from Eric Mclean, Unsplash

Yet consumers have also shown paths for malls themselves.

As more and more people venture out into the new normal, we all want the same thing — to be safe, and to try and get back to human interaction that we had before COVID.

When consumers felt health and safety conditions were met through outdoor spaces, they still headed to malls for dining and drinks, to be social and spend time there. In the line graphs in this article, we also highlighted the growth in mentions of spending time with friends and the drop in mentions of spending time with family in malls.

While these changes in consumer behavior may reshape the expectations we have about what to expect of malls, our study shows that consumer behavior is hinting at potential paths for malls to head in, we just need to listen.

About us: Basil Labs is a big data consumer analytics startup that helps organizations tap into pedestrian and in store intelligence to craft stronger brands and consumer experiences.

For more articles blending data science with retail real estate, follow us on medium.

For short snippets and quick insights, follow us on Twitter.

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Exploring the overlap between data science and communities. Reach out to us if you’re interested in writing — let’s create positive change through data.

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Basil Labs

Basil Labs

Exploring the applications of AI in consumer analytics.

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