Business & Real Estate

Sacramento-area malls get creative to compete against holiday online shoppers

Bayside Covenant Church members Debbie Bissell, left, and Kimberly Olmstead volunteer at a gift wrapping station Wednesday at the Westfield Galleria at Roseville. The Galleria is rolling out some new attractions and services this year in a bid to get customers to come into the mall.
Bayside Covenant Church members Debbie Bissell, left, and Kimberly Olmstead volunteer at a gift wrapping station Wednesday at the Westfield Galleria at Roseville. The Galleria is rolling out some new attractions and services this year in a bid to get customers to come into the mall.

Forget Christmas decorations and holiday carols.

For shopping malls, it’s not enough anymore to gussy up to look and sound good during the holidays.

Increasingly, shopping malls here and nationwide are rolling out seasonal amenities, aimed at enticing more customers to walk in their doors – and to spend money. The efforts are a calculated move to turn shopping centers into regional destinations, part of an effort to combat online and mobile sales as e-commerce takes a larger chunk out of brick-and-mortar sales.

At the Westfield Galleria in Roseville, shoppers can spin a figure eight at the outdoor ice rink, which returned this season after a two-year hiatus. A free day care center, sponsored by Bayside Church, debuted this year. “Merry Maker Elves” roam the mall committing “randoms acts of kindness,” such as passing out goodies and even paying for a customer’s store purchase.

Even the mall’s traditional Santa Claus photo booth received a facelift this year in the form of a “fast track” option for busy parents and toddlers, allowing guests to make online appointments in advance.

“Our goal is to make shopping better, brighter and easier,” said Stephanie Ringey, the Galleria’s marketing director.

As online shopping becomes the norm, malls are struggling to maintain customer loyalty, say analysts. Online retail sales increased 12.6 percent over last year during the five-day period from Thanksgiving to Cyber Monday, according to IBM Digital Analytics.

And with online retailers throwing in enticements such as free shipping, many consumers prefer to shop without ever leaving home or work, right from their desktop, tablet or mobile phone.

“You need to give people really good reasons to drive beyond their local neighborhood,” said Ira Kalb, assistant professor of clinical marketing at the University of Southern California Marshall School of Business. “(Malls) are betting foot traffic will translate into sales.”

The average U.S. consumer will do a record 44 percent of his or her holiday shopping online this year, according to the National Retail Federation.

The fight against online shopping – which essentially turns retailers into 24-hour operations – kicked off on Thanksgiving Day, when many brick-and-mortar retailers opened up as early as 6 p.m., hoping to capture the first round of holiday sales. The Galleria and Sacramento’s Arden Fair mall both opened at 6 p.m.

Ringey isn’t shy about marketing the Galleria as a “social experience” rather than a mere block of retail stores.

“The complaints about the mall is that there’s too many people and the lines are long,” Ringey said. “We asked ourselves, ‘How can we fill in the experience?’”

For the Santa photo booth, the answer was an online reservation system, where guests can book a Santa appointment and pre-order their photos a few days in advance. The Galleria’s Santa sees the heaviest traffic of all U.S. Westfield malls, Ringey said, with more than 20,000 children expected this season. Peak wait times reach two hours, but with an advance reservation, customers can cut that to less than 30 minutes, she said.

Bayside Church is sponsoring two of Galleria’s amenities this year, the day care center and a gift wrap kiosk. The Roseville-based megachurch is paying less than $10,000 to rent both spaces, according to church spokesman Mark Miller.

Calling the mutually beneficial arrangement a “match made in heaven,” Miller said the storefronts represent a unique opportunity to reach new congregants. “They may not walk into a church but if we get to talk to them in a mall, all the better,” he said.

More than 700 children have used the free day care service since it opened on Black Friday. The program includes a story reading about the birth of Jesus Christ and an invitation to attend Bayside’s Christmas Eve services. There’s no charge for the two-hour daycare, but guests are asked to make a voluntary donation, which is given to local charities. The church has raised $12,000 to date, Miller said.

The day care center and gift-wrapping kiosk have been so successful that Galleria management has asked Bayside to return next year, Miller added.

While fully decked out for the holiday season, Arden Fair mall, by contrast, is rolling out very few additional amenities. The mall runs its traditional weekend shuttle bus from the Cal Expo fairground for overflow parking. Now in its second year, a “giving tree” stands next to the mall’s Santa photo booth, allowing guests to purchase gifts for the Children’s Receiving Home of Sacramento.

Jamie McDaniels, marketing manager at Arden Fair, said hosting the tree is a way to give back to the community. The receiving home last year received $30,000 worth of donated gifts, she said.

Asked about the mall’s ability to compete with the Galleria and online stores, McDaniels said, “Our mall is positioned in a very dense area. People visit Arden out of tradition. We’re connected with Sacramento.”

Holiday shopper perks go beyond the region’s malls. At the Westfield San Francisco Centre, JP Morgan Chase operates a VIP lounge, resembling the ones found in airports, for customers who hold a United MileagePlus Explorer credit card. The amenities include free drinks, bakery goods and gift wrapping.

Malls have sought to capitalize on other holidays, including the Lunar New Year, to generate sales. In February, the Westfield Valley Fair mall in Santa Clara, for instance, hoisted red paper lanterns and organized a lion dance to ring in the Asian new year.

But the Thanksgiving-through-Christmas shopping season is the make-or-break period for many retailers.

Both Arden Fair and the Galleria reported growth in foot traffic over the four-day holiday weekend, starting on Thanksgiving. Arden saw a 4 percent rise over last year, according to McDaniels. The Galleria declined to provide specific figures.

Kalb, the USC marketing professor, noted that retailers are releasing new mobile apps to connect with brick-and-mortar shoppers. For instance, the Arden Fair and Westfield apps feature a GPS-like directional system that enables shoppers to locate stores, turn-by-turn. Both apps also contain store coupons and offers.

Kalb warned that unless malls quickly change course, some may go the way of travel agents, many of whom saw their business plummet as people flocked to the Internet to book airplane tickets and hotels.

“Travel agents didn’t add value beyond what the Internet could do,” he said. “Malls need to add value because the Internet has given people tremendous convenience. ... They don’t really need to go to the store.”

Call The Bee’s Richard Chang at (916) 321-1018. Follow him on Twitter @RichardYChang.

Holiday shopping: By the numbers

4.1 percent: Predicted increase in 2014 holiday sales, compared with last year’s 3.1 percent increase

$804.42: Average amount 2014 shoppers expect to spend, compared with $767.27 last year.

9.1 percent: Holiday shoppers who will wait until Christmas Eve to finish their shopping

Last-minute shoppers

(Those waiting until late December):

49 percent: Will shop online

44 percent: Will shop at department stores


35.6 percent: Consumers who said the economy will affect their shopping behavior.

Of those:

64.4 percent: Will spend less overall

31.7 percent: Will do more comparison-shopping online

21.3 percent: Will use newspaper inserts to check prices

9.5 percent: Will do more price comparisons by mobile phone

Source: National Retail Federation, 2014 holiday survey