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The Difference Is Attitude

Shopping centers and the Internet

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“The longer I live, the more I realize the impact of attitude on life. Attitude, to me, is more important than facts. It is more important than the past, than education, than money, than circumstances, than failures, than successes, than what other people think or say or do. It is more important than appearance, giftedness or skill. It will make or break a company . . . a church . . . a home. The remarkable thing is that WE HAVE A CHOICE EVERY DAY regarding the attitude we will embrace for that day. We cannot change our past . . . we cannot change the fact that people will act in a certain way. We cannot change the inevitable. The only thing we can do is play on the one string we have, and that is our attitude . . . I am convinced that life is 10 percent what happens to me and 90 percent how I react to it. And so it is with you . . . we are in charge of our attitudes.”

Author Unknown


The shopping-center industry is under siege; so are its tenants and customers. What happens to them next is primarily a matter of attitude. It makes a good study of how business people react to radical change (in this case, the Internet). And the news provides us with a dramatic example of the use of opposing attitudes.

The Year 2000 Dubious Achievement Award for Marketing goes to Mark Zorensky, president of Hycel Partners, which owns one mall, the St. Louis Galleria in downtown St. Louis. The Wednesday before Thanksgiving, the Galleria informed its 170 retail tenants (including Lord & Taylor, Banana Republic, Cartier, Enzo Angiolini, Right Start, etc.) of a new policy. The policy prohibits any in-store “signs, insignias, decals, or other advertising or display devices which promote and encourage the purchase of merchandise via e-commerce.”

Whoa! This won't work!

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And how's this for the opposite approach: Bernard Freibaum, cfo of the nation's second largest mall owner, General Growth Properties Inc., begins alarmingly mildly, “The Internet is a concern,” but continues, “We're trying to welcome the Internet with open arms.” And it really is a plan: General Growth is establishing an online site called Mallibu (MALLibu, get it?). Customers anywhere in the U.S. can purchase goods electronically from a store in one of General Growth's 135 malls. The malls would thus retain a percentage of those sales.

This will work.

Mr. Zorensky and Mr. Freibaum are both facing the tiger. But with two very different tactics.

The backlash from Mr. Zorensky's tenants came fast and loud.

David Lamb, attorney for educational-toys retailer Right Smart, threatened Mr. Zorensky with litigation in a letter to the mall management: “Aside from the illegality of your tactics, it is unfortunate that you have chosen to fight the inevitable evolution of retailing,” he wrote.

The Wall Street Journal cased the mall for any prohibited e-commerce signs. They found:

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• The Athlete's Foot: “Shop online anytime at www.theathletes-foot.com”

• Nine West shoes: “Get Glitzed. ninewest.com”

• Sharper Image: a sign urging shoppers to go online for a chance to win a $3100 massage chair

• Rand McNally books: “We do plan to inform customers of our online business…”

• Bombay Co.: “No one has ever improved business by making it more difficult for the consumer.”

• Banana Republic: a display on the cash register reads, “Visit us at bananarepublic.com.”

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• And Right Start has a big sign in the window reading, “Shop online. Rightstart.com.” Four big posters proclaim, “Because you're a mom, there's Rightstart.com.”

Attitude, attitude.

Next to the article, The Wall Street Journal listed e-mail addresses of all the participants in this brouhaha.

Jerry Welch, chief executive of The Right Start, got it right from the start when he said, “The Internet is going to be synergistic with physical stores, not take away from them.”

How?

The mall is mad about “returns” being deducted from store sales. But at Right Start, all returns are charged back to the online unit. Store sales are unaffected. Period.

The mall is mad as customers avoid the .25 percent sales tax . . . but they do pay shipping costs. Right Start is offering same-day shipping and free postage.

Kmart puts computer kiosks in every store. Customers can e-order anything that's not in stock. Good idea. Good attitude.

Same business, same country, same day. Negative and positive. Success and failure.

The difference is attitude. Mr. Freibaum is an active optimist. Mr. Zorensky knows it will all end in tears.

The paragraph on “attitude” is probably the piece people send me more often than any other. Nobody knows where it came from, but it has a persistent life of its own. Familiar as it is — like the Gettysburg Address or Sam Walton's paragraph on “the customer” — kind, enthusiastic people keep sending it to me. People keep it, circulate it, read it and re-read it. I hope you'll read it again as if it were new (because the present is new).

Imagine an immediate future in which Mr. Zorensky corrects his attitude to his tenants, and they to their customers. I hope Mr. Freibaum and all the others currently marrying the Internet will read it, remember it, use it, mean it and make money on it. (I hope Mr. Zorensky reads it, too, but I have my doubts.)

It has been ever thus. When teenagers first started irritating mall management, malls reacted with different attitudes. The Mall of America decided the best thing for everyone was the curfew system, so teens were asked to leave. Scottsdale Fashion Square instead created a job for Peter Hardin, a roving concierge who spends his days “walkin'and huggin'” customers and has become famous far beyond the mall for his kindness and good influence on all kinds of customers.

Two different attitudes, same situation.

Some malls react angrily to crime with visible armed guards; others put Mounties on horseback in the parking lots, accomplishing the same thing with style and optimism. But to employees and to customers, what a difference!

The difference is fear. Mr. Zorensky and his honchi are scared of the Internet and living on a barge on De Nial. Mr. Freibaum has chosen to embrace the dangerous tiger. The greatest difference between them is their attitude.

By the time you read this, Right Start (and Rightstart.com) will have sued the landlord, or the landlord will have changed his mind.

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