Falling Out of Fashion

Where have all the teen mall rats gone?
Many of them were inside the Apple store at Cherry Hill Mall on a recent Friday.
Including Isaiah Etienne, 19, of Sicklerville. He used to hit the shoe and clothing stores at the mall weekly. But that changed after he turned 18.
"I've definitely slowed down on the clothes and sneaker shopping," Etienne said. Instead, a chunk of his cash now goes toward electronics. He was at the Apple store to replace his new iPhone6S, which he recently cracked by dropping it.
The scene that day helps explain why once dominant teen retailers - such as Aéropostale, American Eagle Outfitters, and Abercrombie & Fitch - are closing stores.
A 2015 Retail Real Estate Report by consultant DTZ stressed that the trio was getting hit hard by online shopping. The report projects Aéropostale closing 175 stores through 2017; American Eagle, 150; and Abercrombie, 170.
All three stores sat virtually empty from 4:30 to 6:30 p.m. that Friday at Cherry Hill Mall.
"Teen retailers are in a high-risk, high-reward business - a trendy fashion appeal with a fickle customer base," said New York retail consultant Howard Davidowitz. "The decline is a long-term trend."
Industry experts cited four reasons:
Competition. "Fast-fashion" retailers (those with quick turnaround that buy in bulk and sell cheaply) now dominate. Examples include Forever 21 and H&M.
Disposable income. Teens' priorities have shifted from clothing to gadgets and eating out. Gadgets and electronics now account for a much higher percentage of teen expenditures than ever before, a recent Piper Jaffray report found. And for the first time in 13 years, teens last year spent more money on eating out than on clothes.
Brands have become less important to teens. Abercrombie, for example, is taking its logo off merchandise. Teens say they no longer want it.
No longer the teen hangout. Teen mall traffic has fallen by 30 percent over the last decade, a trend that has quickened since 2007, the Piper Jaffray report says.
"Traffic is dramatically down" for teens, though visitors overall have held steady, said Simeon Siegel, senior retail analyst at Nomura International Inc. in New York. "Now you need to give me a reason to walk into the mall.
"The Internet has had the most impact," he said. "The market used to be an oligopoly where five companies controlled the real estate and allowed their stores to control the teen fashion mind-set. The Internet took away the barriers to owning a store, and also created a much greater sense of information. . . . Uniformity is no longer in."
James Cook, Americas director of research and retail at Jones Lang LaSalle, said, "The difficult truth for fashion retailers is the very nature of their business: They do go in and out of fashion.
"Teen shoppers are an especially fickle bunch," Cook said. "The fashion retailers that are struggling at the moment have had trouble offering the right blend of price and style."
Joe Coradino, chief executive officer of Pennsylvania Real Estate Investment Trust (PREIT), which owns several malls in the region, said teens continue to influence household spending.
Across PREIT's portfolio, teen fast-fashion retailers such as H&M and Forever 21 drive substantial foot traffic. At his firm's Cherry Hill Mall, teen retailers generate about $77 million in annual sales, or 25 percent of total non-anchor store sales.
"Although this generation has practically grown up with mobile devices, they still prefer the brick-and-mortar experience," Coradino said. "Shopping truly is a social event, which best manifests itself in a mall environment."
He said PREIT malls have added mobile charging stations, WiFi, and iBeacons, allowing advertisers to target nearby consumers.
Simon-owned Oxford Valley Mall in Langhorne is doing what it can to buck the teen trend. After an expansion, the mall now has the largest H&M in the region. It added several teen retailers - Garage, Cotton On, and Gap - over the last year. Hot Topic and Forever 21 were renovated. Clothing retailer Rue 21 will open there this Thursday; f.y.e., which sells and buys DVDs, CDs, and games, opens Friday.
Jim Malervy, the mall's director of marketing, said that, on average, teens spend $60 per visit at his mall. Clothing is still No. 1, with electronics No. 2.
He uses Facebook and Twitter regularly to reach teens and their parents.
Malervy said that teens account for about 50 percent of mall traffic on Friday nights.
"You have to accommodate their needs and wants," Malervy said. "They influence a lot of decision-making - not by them, but their parents. They have a lot of buying power."
And they eat out a lot.
Besties Julia Braungart, Jenna Belz, and Brooke Albright, all 17 and seniors at Camden Catholic High School, enjoyed dinner at Bistro at Cherry Hill Mall on a recent Friday. They also did little shopping.
"We're dressing more casual," Albright said. "No more logos and brands. Logos that are across your chest are totally out."