The mall as a retail destination is declining. But the mall as an experience center and assorted brand activation is rising in its place. The internet has taught us we shouldn’t tie retail to real estate. Now we are tying experience to real estate and I’m not sure the outcome will be much better. Real estate and long-lived fixed assets aren’t able to adjust quickly enough to an accelerating rate of change of tastes and preferences.
Reverse logistics is defining physical retail. Retailers are also increasingly handling e-commerce returns that may have nothing to do with their own brands. I’ve heard from some retail executives that individual store comps would be negative everyday if online sales were subtracted from the store’s sales. There’s been a lot written about Amazon needing to contain shopping costs. But I imagine much of their focus over the next year will be on containing return costs.