Macy’s and Other Retailers Bringing More Small-Scale Stores to Open Air Malls

Following the People

As the impact of the pandemic continues to reverberate through people’s lives, our lifestyles and the way we work look increasingly different than it did just a couple of years ago. As shoppers stayed home and moved online, the shift away from indoor malls left bricks-and-mortar retailers looking for a change.

One strategy has been to follow the foot traffic. For this reason, retailers such as Macy’s (M), Nordstrom (JWN), and Foot Locker (FL) have been shuttering some of their indoor-mall locations and opening smaller-format stores in the suburbs.

Small in Size, Big on Convenience

Macy’s “Market by Macy’s” stores are largely slated for open air malls, and are about a fifth of the size of the company’s traditional department stores. The stores will carry a limited offering of frequently turned over products, and are intended to serve as a convenient place for customers to pick up and return online purchases.

The company opened five of these operations in three states over the last two years and plans to add 10 more this year under several of its retail brands, including Macy’s and Bloomingdales.

Errand Efficiency

Merchants see certain suburban locations such as grocery stores, supercenters, and gyms as key anchors that will drive foot traffic. It seems brick and mortar retailers of all sizes are seeing opportunities in the evolution of how Americans like to shop. In addition to the big department stores, Amazon (AMZN) is experimenting with a physical apparel store, Amazon Style. Kay Jewelers, Bath & Body Works (BBWI), and Sleep Number (SNBR) also plan to expand into the open-air mall space.

Consumers may come to appreciate having a greater variety of stores close to home, offering a more efficient way to cross a few items off their to-do list on their way home from the gym or supermarket.

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