'Experiential' retail surges as landlords try to lure customers back to the mall

Yahoo

27-02-2025

In a former clothing store in Santa Monica, young entrepreneurs hawk products live on TikTok, sometimes in marathon sessions that last many hours. Fans and customers can stroll onto the floor that was once filled with racks of trendy women's apparel to watch them work and perhaps buy some of their wares.
Nearby, people play miniature golf in a former food court where the holes are designed as tiny movie sets — intentionally made for Instagram to boost customers' social media feeds. Kids putt in the daytime. After dark, cocktails flow for the dating crowd and the karaoke lounge gets busy.
Down the way on the Third Street Promenade, resounding whacks of pickleball volleys pop out of a 1960s-vintage storefront last occupied by shoe seller Adidas.
The conversion of stores where customers were passive consumers to places where they participate in the action reflects changes in shopping habits brought on by the internet and a growing desire among many young people for shared experiences.
Hazy pandemic memories of anxious confinement and forced distancing from other people are playing a part in the trend too, Bay Area retail consultant David Greensfelder said.
"When we finally got let out of our collective time-out corner, we really wanted to go do stuff," he said. "Generally speaking, we're still really wanting to go do stuff."
The concept of "experiential retail," as it is known in the real estate business, is hardly new — in the 1970s, for example, Chuck E. Cheese combined food with arcade games and families came to play instead of just eat.
But recent growth in experiential retail combines people's desire for active experience with landlords' compelling need to fill space. Malls have been struggling for decades as department stores consolidated and fell out of favor. The pandemic only accelerated the trend of shopping from home and having purchases delivered. Spectacle is one way to get people to show up in person and perhaps patronize other businesses too.
It's a tactic being embraced in Santa Monica, where the Third Street Promenade and Santa Monica Place shopping destinations have labored to attract customers in recent years. Among the Promenade's challenges is its scale — the mall's unusually large stores can be hard to fill in an era when many big retailers are reducing their footprints.
Landlords have shown a willingness to try tenants they might have once deemed unseemly.
"Pickleball in a brick-and-mortar would have been really unheard of five years ago," said Andrew Thomas, chief executive of Downtown Santa Monica Inc., a private nonprofit organization that promotes the city's business district.
Pickle Pop, where players can reserve court time in the former Adidas store, is part sports club, part clothing retailer and part restaurant. Such a hybrid approach can spur more business — Splatter Studio on 4th Street near the Promenade is part bar and part art studio, where customers suited up in coveralls paint messy "masterpieces" on canvas as they imbibe.
Group activities are proving appealing, Thomas said.
"Many people want more experiences in a destination that is fun and exciting," he said. "Things they can do and put on Instagram and have fun with their friends."
Holey Moley Golf Club, the mini-golf center, is also a restaurant, cocktail bar and karaoke lounge, all elements intended to get people to show up and participate in what General Manager Simon Whicker called "competitive socializing." The 27 holes are small but elaborately decorated with nods to 1980s and 1990s nostalgia.
The venue is "a multisensory labyrinth" that includes neon signs with cheeky slogans and hand-painted murals, he said. After 8 p.m. when only adults can play, DJs and strolling magicians perform on weekend nights. Cocktails are served in ceramic unicorns and miniature bathtubs.
Social media is the key driver of Outlandish, a TikTok content factory where creators hired and trained by the store sell products such as nutritional supplements, clothes, workout gear and gum. The brands rent booths from Outlandish. Customers can watch creators enthusiastically pitch their wares to an online audience and perhaps buy what they are selling.
The goal of Outlandish is to combine "the excitement of live, interactive shopping with the personal connection of in-store visits," Chief Executive William August said.
"We have the capacity to bring global, world-renowned brands right here to customers and visitors in Los Angeles," he said. "That local audience can then step into their very own livestream and interact with viewers across the world."
Businesses are experimenting with experiential retail in multiple formats, said Lee Shapiro, a real estate broker at Kennedy Wilson who specializes in selling and leasing retail properties.
Years ago many were aimed at families with children, such as indoor trampoline parks and Chuck E. Cheese, he said. Now proprietors are going after adults with concepts like Holey Moley and Punch Bowl Social, which combines eating and drinking with nostalgic amusements such as billiards, bowling, darts and arcade games.
Inglewood's Hollywood Park retail center hosts Cosm, an immersive theater that features plush stadium seating and a wraparound screen that's 87 feet in diameter with life-like resolution that gives the venue that opened last year the feel of a scaled-down Las Vegas Sphere.
The entertainment- and sports-focused venue gives viewers the sense of being in the best seats at events such as Cirque du Soleil, NBA basketball and the World Series, while eating and drinking. Cosm has its own production team with the ability to shoot an event from as many as 10 different vantages, while also providing a network's feed on virtual screens in the corners.
For instance, while an audience of millions watched Freddie Freeman's walk-off grand slam in Game 1 of the World Series from Fox's angles, the Cosm crowd experienced it from seats behind the plate at Dodger Stadium.
The reaction in Cosm was "pandemonium," Cosm Chief Executive Jeb Terry said.
Other experiential attractions use virtual reality, such as an exhibit about the Titanic coming to the Beverly Center mall in Los Angeles in March. Visitors wearing headsets will virtually descend to see the infamous wreck as it exists today, then appear to go back to 1912 before the ship sank and wander public spaces such as the Grand Staircase, dining rooms and bustling decks.
At Topanga Village mall in Warner Center, people wearing VR gear on their heads and bodies can battle virtual zombies and other attackers or compete with each other in a "Squid Game" simulation at Sandbox VR.
Young people are driving the trend for active participation, Greensfelder said.
"Among Gen Z, you're seeing a huge desire to actually have in-person experiences again," he said. "They're going back to the mall."
For users of social media such as TikTok, "It doesn't surprise me one bit that this cohort is very experience-driven, as opposed to material thing-driven. They also want to have the experience be in person."
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This story originally appeared in Los Angeles Times.