Whether it is for food courts or movie theaters, company-sponsored events or interactive activities, trips to the shopping mall have become increasingly more entertaining. Illustrating the growing bond between retail and entertainment, a top talent and literary agency and a major real estate developer are forming a joint venture.
The talent shop is the William Morris Agency in Beverly Hills, Calif., which represents clients like Whoopi Goldberg, Angelina Jolie, Regis Philbin and Kevin Spacey but also serves marketing clients like Anheuser- Busch, eBay, Harrah's Entertainment and Texas Instruments.
The real estate company is the Mills Corporation in Arlington, Va., an investment trust that owns, manages and markets malls-cum-tourist destinations like Sawgrass Mills in Sunrise, Fla., and Ontario Mills in Ontario, Calif.
The joint venture, called Venue3D, is intended to attract marketers by offering ways to create interactive experiences for consumers. That could include promotions, sponsorships and naming-rights deals, as well as theme environments, in which, for example, an area of New York City, say Madison Square Garden, could be focused on a particular topic, say sports, to create ties between brands and consumers.
Venue3D's offerings underscore the efforts made to find new and different ways to market to consumers.
For instance, Mills began adding many entertainment features to its malls about five years ago, setting up interactive attractions like Bass Pro Shops, a Gibson Guitar Showcase and Vans Skateparks. Last year, Mills sold the naming rights to a mall in Georgia to Discover Financial Services, part of Morgan Stanley Dean Witter & Company. The mall, called Discover Mills, is scheduled to open in the fall.
Venue3D comes less than two years after the Corporate Consulting Group, a unit of William Morris, was hired by Mills to find companies that wanted to market their brands and content to consumers at Mills properties. The consulting group, for instance, helped connect Mills to eBay, for live auctions. Another partnership linked Jillian's family entertainment centers at Mills malls to Seventeen magazine, owned by Primedia.
Venue3D will be based in Arlington with four full-time employees who will also be working from Morris offices in Beverly Hills and New York. About half of the Morris Corporate Consulting Group will work part time for the venture.
The joint venture is the first for Morris since it was founded in 1898 and the first for Mills outside of development. Mills has had ventures with other developers like the Simon Property Group and Tishman Speyer Properties.
Including the properties owned or managed by Mills, Venue3D is bringing together developers and property owners with more than 200 sites that are visited by about one billion customers each year.
Morris and Mills will own equal stakes in the venture, and a minority stake will be held by the Bronson Companies in Los Angeles, a real estate and entertainment company whose chief executive, Richard Bronson, a former director at Mirage Resorts, was instrumental in bringing together Morris and Mills.
"Venue3D is going to offer a way to bring products into consumers lives in the same way that you're seeing integrated advertising on television," said Steven H. Kram, chief operating officer at Morris. "When you look at a show like `Survivor' and you see contestants eating, drinking, driving the products, consumers can't fast-forward through these products."
Just like on television, he said, products can be integrated into a story line at the shopping center.
"When a brand is advertised on TV for seconds," said Laurence C. Siegel, chairman and chief executive at Mills, advertisers "don't know if the person is sitting in front of the TV or going to the bathroom."
Marketing through retail sites, Mr. Siegel said, is "a much more direct way to the consumer."
Plus, he said, Venue 3D is going to be a lot more affordable. "We're not going to be asking millions of dollars for a 30-second spot."
The client network begins with the Fairmont Hotel Group in Toronto, with properties like the Plaza Hotel in New York and the Fairmont in San Francisco; the Rouse Company in Columbia, Md., with Faneuil Hall in Boston and South Street Seaport in New York; Urban Retail in Chicago, with the Century City Shopping Center in Los Angeles and the Water Tower Place in Chicago; Vornado Realty Trust, with the Penn Plaza offices in New York and Chicago Merchandise Mart; and Westcor Retail in Phoenix, with FlatIron Crossing in Denver and the Scottsdale Fashion Square in Phoenix.
Mr. Kram and Mr. Siegel said that Venue3D services would go beyond shopping centers to office buildings and urban centers, airports and train stations, college campuses and parks. Marketers can also select properties according to their region, or their offerings, like fashion or tourism.
The rise in location-based marketing through entertainment dates back to the early 1990's and can be attributed to an effort to keep mall shoppers from shifting to the Internet or other competing retail forms, like catalogs.
"You would be hard pressed to build a shopping center today without some form of entertainment in it," said Malachy Kavanagh, a spokesman for the International Council of Shopping Centers in New York.
Other developers have also tried to increase their marketability. Simon Brand Ventures, part of Simon Property, for instance, offers mall-marketing programs to clients including AT&T, Ford and Microsoft. Last year, Simon Property brought several shopping centers together in a program called Merchant Wired, an effort to bring high-speed Internet access to 400 properties. Glimcher Realty Trust in Columbus, Ohio, has worked with Michael Ovitz, the former president of the Walt Disney Company and founder of the Creative Artists Agency.
"The marketing effort of a property can be as important as the leasing of a property," said Mark Rivers, executive vice president and chief strategic officer at Mills, who was named to the additional post of chief executive at Venue3D. He said that marketers like Procter & Gamble and Ford could be just as valuable as companies that actually lease space, like Gap or Abercrombie & Fitch.
"When you think in terms of a regional mall that can get a million customers who are predisposed to shopping, that's a powerful venue for an advertiser to be in," said Mr. Kavanagh, who remarked without knowledge of Venue3D.
Allison Fass, The New York Times. June 1, 2001
Copyright © 2001 The New York Times Company. All rights reserved.