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Malls' holiday marketing reaches new heights

Amid forecasts of weaker sales, promotion budgets soar at Los Angeles-area shopping centers.

November 23, 2009|By Andrea Chang
  • Shoppers watch a demonstration by aerialists at the Beverly Center in Los Angeles. The mall plans to hold 60 free holiday performances starting Friday.
Shoppers watch a demonstration by aerialists at the Beverly Center in Los… (Gary Friedman / Los Angeles…)

Suspended up to 80 feet in the air, aerial performers in sparkly red outfits spiraled, somersaulted and soared above a crowd at the Beverly Center on a recent evening.

The spectacle wasn't the latest Cirque du Soleil act but a preview of the shopping center's free holiday show -- the biggest Christmas production the mall has ever undertaken and a third more expensive than those of previous years.

Each holiday season, shopping centers nationwide turn into over-the-top winter wonderlands, with thousands of twinkling lights, towering Christmas trees, nonstop seasonal music and long lines to meet Santa.

With holiday sales expected to be weak again this year, malls are going on spending sprees to lure customers and get them in a shopping mood during the crucial retail season.

"Redoubling the marketing efforts in times like this can be very effective," said Michael Niemira, chief economist at the International Council of Shopping Centers, who estimated that the average 1-million-square-foot mall spends $70,000 on holiday decorations and programs.

Those costs are seen as a smart investment because of the "spillover effect" that occurs when consumers visit a mall specifically to attend an event, Niemira said. The shopping council estimates that about two-thirds end up shopping in a store or eating in a mall restaurant, or both.

That was the case for Deborah Porto, who went to the Grove in Los Angeles on Sunday to watch the shopping center's annual Christmas tree lighting ceremony.

Although the 23-year-old dance teacher did not plan to shop, she ended up buying coffee, three bottles of lotion and three bottles of bath gels before heading to Morels French Steakhouse & Bistro, one of the mall's restaurants, to grab dinner before the tree lighting began.

"It's a good strategy and it definitely works," Porto said of shopping center events. "It gets people to spend money and it gets people here."

After last year's disastrous holiday season -- the worst in more than four decades -- malls are "pulling out everything they can," said Maureen Pollack, a marketing manager at commercial real estate brokerage CB Richard Ellis. Around the Southland, centers are promising bigger and better holiday shows, sprucing up their decorations and working with retailers who want to extend their holiday hours.

"Every resource that you can imagine has been deployed," said Jeff Brown, general manager of the Beverly Center in Los Angeles, which will host 60 holiday performances starting Friday. "It's just this big, grandiose, epic sort of show, and it's based on capturing the escapism that people were looking for in the 1930s when the country hit hard times."

Shopping centers are also offering more deals and freebies in hopes of enticing frugal shoppers who have been avoiding the malls during the recession. Some of those promotions include free gift cards or champagne glasses with a minimum purchase, complimentary services such as gift wrapping and refreshments, and giveaways of laptops and shopping sprees.

"Everybody is really looking at this holiday season as an opportunity," Pollack said. "It's making sure that the moment people step on the properties that it exceeds expectations."

South Coast Plaza in Costa Mesa is spending 25% to 30% more on the shopping center's holiday lineup this year, one of its biggest ever, said Debra Gunn Downing, executive director of marketing.

Among its offerings: free hot cocoa and cider Fridays through Sundays, twice as many live musical performances as last year, and holiday landscaping featuring new pottery with poinsettias, ivy trailings and "a variety of florals in reds and whites."

"Obviously when you're in an economy that is a little more challenging, it's a time when you think more out of the box and have more creative programming, and that certainly is the case with us," Downing said.

In a region as mall-dominated as Southern California, attracting shoppers is a competitive business.

Tenants pay high prices for prime retail real estate -- the average asking rent for a 1,000-square-foot shopping center space along the Mid-Wilshire corridor is $4,130, according to CB Richard Ellis -- so they expect landlords to shoulder some of the promotional work.

And with merchants hurting from the effects of the economic downturn, they're even more dependent on the malls to help bring shoppers around.

"We're extremely appreciative," said Jim Fielding, president of the Disney Store chain, whose U.S. stores are mostly in shopping centers. "We view our mall landlords and the management companies as our partners in the season, so anything they do to improve the guest experience and drive traffic to the mall is good news for us."

One of its landlords, mall operator Westfield Group, is launching a holiday program called 12 Days of Shopping, which brings a different theme or promotion to its centers on a dozen days. On Day 1, for instance, shoppers can enter to win a $5,000 shopping spree; on Day 9, customers can get two items gift-wrapped free of charge.

Westfield, which owns several Southland malls, is also upgrading some of its individual mall programs, such as introducing a holiday light show at its Culver City location.

"Because we know how important it is for our retail partners at this time of the year, we absolutely want to make sure we're doing as much as we can in support of them to drive business," said Alan Cohen, Westfield's executive vice president of marketing. "We are very much joined at the hip."

andrea.chang@latimes.com

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