DEATH OF MALLS 2*
note: many thanks, GL in CA, for the very interesting letter and the donation.
GB in TN, much appreciate the donation and kind words ( the wording was a bit vague to me-was the entire amount a donation or did you want some books also? Please e-mail me to clarify ).
You want to know why bookstores are going under? It isn’t because of the Internet selling cheaper. There used to be and still are mail order companies selling even cheaper books. Anyone can order bulk and sell at razor thin margins if your business model is functional. No, what made Amazon a success was its customer reviews. You want made for mass consumption lowest common denominator sixth grade reading level New York Bestsellers List drivel? A book store sells all those at reasonable prices. Do you want other readers to tell you which ones were great and which were crap, AND in your preferred niche? You buy at Amazon. Low prices are just a bonus. The main selling point is that you don’t want to waste your money. Low prices just mean you spend the same amount on extra books. But, you aren’t buying crap you don’t want to read! THAT is why Amazon rocks. As money gets tighter because the elites keep raising the costs on monopoly businesses, you want each discretionary dollar to buy more. A bookstore that tries to duplicate the atmosphere of a mall will still, sooner or later, go out of business.
Indoor malls were perfect for what they did. Entertain to encourage shopping. But it was a very expensive entertainment, wasn’t it? The fast food was more expensive, the clothing was more expensive, the movie tickets were extra. And all that wasn’t so bad when they started. By building at the level they did, the increased costs for the building and the maintenance for the artificial environment was shifted to enough individual stores that the cost was easily born by the consumer. By building up, parking and space was cheaper. That partially compensated for the indoor temperature control, the security personnel, the cleaners and the management. The rest was a minor burden gladly shared by the consumer for the extra benefits. But as time went on, the customer burden kept rising. Taxes, property values artificially increased by the real estate bubble, the cost of wages and electricity. And at the same time, over-competition.
When you have an indoor mall, originally, you had a diversity of retail establishments. Granted, the bulk was clothing. Girls were the main customer. But then, as clothing manufacture moved over to China, there was a brief period when clothes were THE number one profit product. Huge mark-ups. So, like the brainless lemmings that they are, CEO’s all moved to clothing ( exemplified by Sears going from everything you needed to live to basically just clothing ). So many moved to clothing that everyone started looking the same. It almost didn’t matter where you shopped, you got the same clothes. So, is it any wonder the malls with their increased operating costs lost out on sales to slightly less expensive non-mall stores? Which brings us to Big Box stores. Those are also suffering now, the same as indoor malls, and for the same reason. All clothes and high costs, but at the time of their rising popularity twenty years ago they offered the price alternative to the indoor malls enough folks wanted.
Wal-Mart is, incidentally, just one more Big Box store and suffering accordingly, but we’ll cover that later. For now, back to indoor malls. They started dying out twenty years ago and not because of the Internet. If the ‘70’s were hedonistic excess to escape the collapse, and the ‘80’s were popular consumption just for the sake of consuming to forget the collapse, the ‘90’s were less about mindless consumption than they were about focused, thoughtful consumption ( for the life of me I can’t imagine the reasoning behind this, other than perhaps we went from the last vestiges of approved mass consumption as cultural identity to the new modern individualism which denies any mass involvement. From Corporation Man to Unibomber Hermit. That discussion merit’s a separate article ). Not only were we less sociable ( BEFORE the Internet, not after. After was just reinforcing a trend ) but we didn’t see any reason to pay for that unwanted privilege.
It wasn’t that we didn’t have the money, because aside from a short period during Sandbox War I we spent the Nineties wallowing in cheap Siberian oil ( which, HELLO!!!! Pretty much paid for all those cheap commodity prices by using extra energy to mine far more diffuse ores, a one off activity, which bought all those fiber optic lines which broadband-ed the country AND as a bonus threw in the Tech Wreck as a needless luxury ). It was that we became less social. And we reacted not by shopping exclusively online but by eliminating the social aspect of shopping to the point it became far more a teenage activity rather than an adult one. Which didn’t exactly pay the bills at the indoor malls once disposable income took a massive crap when the real estate bubble burst. Rather than shopping at the mall, with its high prices including the social gathering places as its core business model, we niche shopped at the Big Boxes.
It’s hard to believe now, with their typical fifty percent above Amazon prices, but at one time Big Box stores were very affordable. They were cheaper than the malls, and, a huge attraction, there were some clothing stores but there were also stuff guys liked to buy! Imagine, some bright boy CEO actually noticed that the other fifty percent of the market had money. Typically, yes, the female of the family both spent the money and decided where to spend it, but by the time of the Big Box divorces and the new Marriage Gender Penalty discouraging marriages in the first place opened up new trends in consumption. At the time, it was also true that stores could benefit from economics of scale. That is what shot Wal-Mart up into the stratosphere ( but which of course also left them much further to fall ). Not anymore of course, which is why Big Boxes are now so sad and pathetic. We continue tomorrow.
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