Shopping Malls are dying. What's the reason for dead malls?

Hey All 💜

It has been a tough decade especially when the Covid-19 pandemic hits and for brick-and-mortar retailers, it seems only in a matter of time things be getting worse. True, the internet has changed completely the way we shop. But taken together, other elements have caused greater damage to traditional retail stores. 

Due to the coronavirus pandemic, which forced countries around the world including Malaysia to either go into lockdowns or enforce strict social distancing rules, a lot of the shopping is being done online. With safety and uncertainty in shoppers’ minds, how shopping is done and what consumers are going to buy are changing. 

And this inadvertently has caused many foreclosures of retail stores. With many stores closing, in a matter of time, the malls will be deemed to be deserted or as people call it as ' Dead Malls' 

What's a Dead Mall? 

A dead mall (also known as a ghost mall or abandoned mall) is a shopping mall with a high vacancy rate or a low consumer traffic level, or that is deteriorating in some manner.

Many malls are considered "dead" (for the purposes of leasing) when they have no surviving anchor store or successor that could attract people to the mall.

Without the pedestrian traffic that department stores previously generated, sales volumes drop for almost all stores and rental revenues from those stores can no longer maintain the costly maintenance or rentals of the malls. Without good pedestrian access, smaller stores inside malls are difficult to reach.

The number of dead malls has increased significantly because the economic health of malls across Malaysia has been in decline, with high vacancy rates in many of these malls.  Though some might survive, only for the reason that some malls have that had maintained profitability, specifically in areas within a large community or the centre of a town or the major tourist attractions.

What's the reason for malls to die? 

There could be many reasons why Malls can fail. This can include another newer mall, a lifestyle centre or a large hybrid power/lifestyle centre. As a result, shopping patterns change, trade areas shift or shrink, tenant mix suffers, occupancy and sales decline, and landlord investment often dries up. 

On top of that, a storm of global trends is coming together at the same time to cause malls to change the role they play in people’s lives. No longer are they mainly about shopping. Now, when consumers visit malls, they are looking for experiences that go satisfactorily exceeding traditional shopping than what used to be.  Which made the traditional retailers willing or unwillingly are increasing the investment and engagement by switching online channels as this is something they can’t ignore forever.

So what is really killing the malls?

To begin with, while e-commerce is growing sharply. Most analysts and industry experts agree that this is largely due to the growth of e-commerce and this is not expected to diminish anytime soon. The e-commerce revolution and the rise of digital technologies are fundamentally reshaping consumer expectations and diverting the function of stores toward useful and entertaining customer experiences. 

According to Capillarytech, Malaysia’s e-commerce market is quickly becoming one of the largest in Southeast Asia. Its growth is outpacing that of traditional established markets in the region. This was apparent even before the impacts of the pandemic— Malaysia’s business-to-consumer e-commerce value increased 39 per cent in 2019 alone. 

This growth in e-commerce has been coupled with the growing consumer preference for online shopping and the availability of customized payment options in recent years. Moreover, Malaysia is now catching up to bring its e-commerce infrastructure, including product availability, payments, delivery and regulatory requirements, in line with more established online shopping markets.

Although shopping malls can provide the best shopping experiences such as social gatherings, entertainment, performances, product launches, promotions, festivals and such. Malls can be very helpful because all the needs are in one building. It enables the shoppers to find their necessities as well as their luxuries. Shopping malls tend to be major tourist attractions.

But the downside of it also takes a toll such as they do not promote the indigenous products ( mostly commercial )  and most of the products are overpriced due to the setting of the products.
Sometimes the malls are really overcrowded. And basically, nowadays, most people just come to click some pictures and roam around the mall which is unfortunately for anti-social groups as they tend to avoid the large gathering of people.

There is hope for some retailers. Stores are shifting to become "the centrepiece of interacting with customers," handling tasks like fulfilling online orders. Companies that are able to adapt their store formats will be "best placed" to weather the storm. 

Being said that, newer innovative malls are incorporating value-added elements that attempt to recast the mall as the new downtown, including concerts, art centres, spas, fitness clubs, and farmer’s markets. These services provide a level of leisure and entertainment that can never be satisfied online.

But at the end of the day, retail offers that social experience that online cannot and malls are safe places to be and serve as avenues for some relief, both physically and mentally while shopping for necessities thus, there is bound to be recovery and some amount of revenge shopping and dining. 

 Well, that's all for now! Thanks for reading my blog !! I hope you've enjoyed it!

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ZazaAzman a.k.a MamaMonsta👻

*Disclaimer - Original photo was taken from Google Images. Credit to its owner. Edited version done by Zaza Azman