What is the future of retail and malls in the United States? With Amazon and online shopping growing, where does that leave physical retailers and all of the real estate they have traditionally occupied? What shops, attractions, and new experiences will fill the millions of square feet of empty retail space at malls and shopping centers? I shared my thoughts in this wide-ranging interview with Authority Magazine.
Here’s an excerpt from the interview where I answer the question:
“Can you share 5 examples of how retail companies will be adjusting over the next five years to the new ways that consumers like to shop?“
A 2017 report by Credit Suisse predicted 25% of malls will go out of business by 2022 leaving millions of square feet of retail space empty. That will likely be accelerated by COVID-19. What will happen to all of that space? I predict that experiences will be a major part of the future of retail. Trampoline parks, indoor theme parks, go-kart family fun centers, and virtual reality games have already started to replace many department stores in malls. The new American Dream Mall in New Jersey is a look at the future of the country. It was originally designed to have 55% entertainment space and 45% retail space but has already pivoted to 70% entertainment space and only 30% retail space. Our 14 chain indoor family fun center currently has four locations inside malls. We plan to open more locations inside of malls in the coming years. Each location takes up the space of a large department store with over 50,000 square feet of rides, arcade games, dining, and more.
Theme Park Podcast For Attractions Industry Professionals
Philip Hernandez and I have teamed up to launch a new theme park podcast for professionals in the Attractions Industry, including owners, operators, marketers and more. Our goal is to make the “Marketing Your Attraction” theme park podcast essential listening for professionals from every part of the industry, including theme parks, haunted houses, escape rooms, family fun centers and more. Every episode starts with the news of the week before taking listeners on a deep dive into a different marketing topic and how it applies to the Attractions Industry. Philip and I have spent over a decade in the industry and bring a total of over 20 years of combined marketing experience to our conversations. Listen below or subscribe today using your favorite podcast player. I would really appreciate any and all feedback plus ideas for future show topics through Twitter or email.
Episode 7: The Impact of America’s Evolving Demographics
One of my favorite conversations from the podcast was from a recent episode about the evolving demographics of America. For the first time in human history, by 2035, people aged 65 and older will outnumber children under age 5 in the United States, according to U.S. Census projections. What does America’s evolving demographics mean for theme parks and the attraction industry? Philip and I discussed challenges and opportunities that these new demographic milestones will bring to the new industry. Will the young adults that make up the majority of guests at pop-ups, concerts, haunted houses and more continue to look for similar experiences when they are older? Will Museum of Ice Cream type pop-ups be created that appeal to adults that are 65 or older? I can easily imagine an “I Love Lucy” pop-up being incredibly successful in 2018 if executed correctly.
In today’s post, I take a closer look at how the different parks in the Cedar Fair chain contribute to the company’s overall revenue and EBITDA. As both a fan and member of the amusement park/theme park industry, I am always searching for ways to learn more about the many incredible companies that operate parks all over the world. Although I enjoy putting on my “fan hat” from time-to-time to read speculation and theories about new rides, I find the most interesting insights come from looking at each business holistically. At the end of the day every park is a business, a fun business, but still a business that is best understood by analyzing it through such a lenses.
There are very few resources to turn to for coverage and data about the inner workings of the industry. The Global Attractions and Attendance Report compiled by the Themed Entertainment Association (TEA) and AECOM is one of the best resources available. Unfortunately, even that report relies on unofficial guesstimates and is considered by many in the industry, including myself, to be directionally, but not completely accurate. The most accurate sources of information are the earnings calls, SEC filings and investor presentations that the major public companies in the amusement park industry release on a quarterly basis. Unfortunately, public companies only release tidbits of financial information that typically focus on the overall company and not specific parks or areas of the business. Large conglomerates such as Disney and Comcast provide less data as the theme park business only accounts for one part of their overall companies. On rare occasions, companies will provide more insightful and complete information about how their business operates at the park level.
The saying “You have to spend money to make money” has been shown to be true over and over again in the amusement park industry. A common question that is posed by both analysts, fans, financial advisors and shareholders is what new ride is coming next to the parks. Fans are excited to experience brand new rides and attractions while analysts, financial advisors and shareholders are worried about how much companies are spending on capital expenditures (capex) every year. Unlike companies in some industries, it’s impossible for an amusement park or theme park to be able to thrive without continued reinvestment. Some companies in other industries, for example In-N-Out, can continue to grow for years without changing their offerings, but that strategy simply doesn’t work in the amusement industry where guests need new motivations to turn off Netflix and head to the park. Let’s take a look at how much the two leading regional amusement park chains, Cedar Fair and Six Flags, have been spending annually.
My Disneyland Training Manuel from 1967 is one of my favorite possessions that originally belonged to my Grandfather. The “Walt Disney Traditions At Disneyland” Disneyland training guide is a time capsule that captures Walt Disney’s genius. Cast Members were originally provided the training book after they sat through the University of Disneyland orientation program. During a recent move, I stumbled across the guide again and decided to scan every page to create this PDF:
On January 31st I had the opportunity to have a 2-hour lunch with Disney Legend Marty Sklar. Marty worked at Disney for 54 years in many roles including as a writer for the first Disneyland Newspaper, writer for Walt and Roy Disney, and as the leader of Walt Disney Imagineering as president and principal creative executive. The lunch was the first of the series “Lunch With a Legend” presented by the official Disney fan club D23. Continue reading →