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Mall Owners Join Retailers to Drive Back-to-School Sales

As retailers shift into high gear for the all-important back-to-school shopping season, mall owners and operators looking to boost sales at their centers are riding shot-gun.

Next week, Simon Property Group will begin its Teen Spree shopping events at 12 select properties. The Teen Sprees, which run between three and five hours, were tested last year at two of Simon's more than 200 U.S. properties. On a given day in August, shoppers can buy a ticket for $5 and get various discounts on purchases from selected mall stores ranging from specialty apparel to electronics to athletic footwear.

In its inaugural Back-to-School survey, released this month, Deloitte cited 79 percent of U.S. consumers said they will be more focused on buying products on sale this year than they were in 2007. In addition, 53 percent said they will use store coupons more than they have in the past.

“Teens and children are still going back to school,” says Cathi Weiner, senior vice president of development with Simon Brand Ventures, Simon’s Property Group's marketing arm, adding that they will continue to need school supplies even in a troubled economy.

The Deloitte survey reported up to 71 percent of U.S. households will spend less money this year on back-to-school purchases than they did in 2007. American consumers are too worried about falling housing values, job security and shrinking credit to spend as they did two or three years ago.

In addition, with gas prices continuing to hover near $4 a gallon, consumers will limit their shopping trips —69 percent of the Deloitte respondents said they would shop at no more than three stores.

“It’s about trying to limit the number of destinations [consumers] go to," says Stacy Janiak, U.S. retail leader with Deloitte. "Retailers can bundle promotions. . . offering discounts on certain products together will have some appeal.”

As a result, both retailers and mall owners have been aggressive with their promotion campaigns, even kicking them off earlier—in mid July, instead of the last week of the month.

The back-to-school season, typically an eight-week-long period that spans from the last week of July and runs through the third week of September, is not only the second most important season of the year for retailers, accounting for as much as 15 percent of their annual sales, it is a bellwether for the all important holiday sales season.

Aware of how critical this back-to-school season will be, mall owners have been stepping up their marketing efforts.

At several of its malls near Detroit, Taubman Centers, Inc. has been running back-to-school campaigns targeting Canadians, who stepped up their cross-border shopping in recent months. At Great Lakes Crossing in Auburn Hills, Mich., for example, shoppers can take advantage of a (U.S.) $159.99 shop-and-stay package that includes one night at a Holiday Inn hotel, free breakfast, two $25 mall gift cards, a student backpack, a lunch voucher for one child 16 years of age or younger, a Great Lakes Crossing tote bag and a Great Lakes Crossing Visitor Savings Pass.

The other Taubman properties in Michigan taking part in this promotion include the Mall at Partridge Creek in Clinton; the Twelve Oaks Mall in Novi and the Fairland Town Center in Dearborn.

Despite all these efforts, the 2008 back-to-school season will be weak, says C. Britt Beemer, founder of America’s Research Group, a Charleston, S.C.-based consumer behavior research firm. He forecasts back-to-school sales will register a decline of as much as 2 percent.

Beemer estimates, same-store sales between mid-July and mid-September will grow no more than 0.5 percent. By comparison, from July through September of 2007, same-store sales at U.S. chain stores saw an average increase of 2.4 percent.

“Parents are going to be much, much, much more focused on getting good deals,” says Beemer. “I think we will see a back-to-school season that’s going to be very challenged.”

--Elaine Misonzhnik

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