Why Ethnic-Specific Shopping Malls Are Doing Fine

strip mall empty

With the consumer all tapped out, this is certainly a tough time for malls, both of the “strip” and indoor variety. Some have even written of the shopping mall entirely, declaring its era to be over — gone the way of the Dodo and the latenight network news.

But according to a report from the Christian Science Monitor (via TrafficCourt), the “ethnic” strip malls are doing just fine. These are strip malls where all the stores are geared towards a specific ethnic group, like, say Vietnamese, Chinese or Latino:

In Seattle, the Great Wall Mall has actually seen an uptick in volume in some stores. “The big financial meltdown has affected us somewhat,” says developer Omar Lee. “But sales volume is up at the 99-Cent Market, the noodle shops, and other low-cost retailers. We’re still very packed on weekends and holidays.”

Part of ethnic malls’ secret is that their niche markets are more reliable and well protected in a recession than mainstream ones.

“Customers are willing to go in and shop there even if it’s not the best price,” says David Kaplan, professor of geography at Kent State University in Ohio. “Loyalty is very important.”

Even if individual incomes are down among the minorities who make up these niche markets, their overall numbers are growing, offsetting any downturn in spending. One in 3 US residents belongs to a minority group today. The Pew Research centre predicts that number will be 1 in 2 by 2050. Hispanics, who alone account for 14 per cent of the US population today, are expected to swell to 30 per cent by 2050.

The success of ethnic malls is probably related to other trends, like the rise of “locavores” — people who put an emphasis on eating local goods. In urban areas, there’s clearly a wellspring of interest in handmade items, community gardens, etc., even when it means higher costs.

The bottom line is that it’s not just ethnic minorities. A lot of people are turning against the mass market towards the comfort of the familiar and familial.


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