The Limited Bets On Outlet Malls To Combat 'Mall Showrooming'

The Limited, which opened its first outlet store in 2012, said it will open four more this year in Nashville, suburban Chicago, suburban Detroit and San Marcos, Texas, Columbus Business First reported on Friday (May 3).

The 260-store apparel chain has avoided outlet malls for most of its 50-year history, sticking with stores in conventional shopping malls. But the chain was sold in 2007 to private equity group Sun Capital Partners. Limited SVP of stores William Acevedo said in a statement that the outlet mall push "has been well-received, and we are reaching new customers."

The chain isn't abandoning conventional mall stores (it's opening eight of those this year too), but the Limited's shift to outlets may be a sign of a longer-term shift for U.S. retail. Outlet malls are growing in popularity, in part because of a sense on the part of customers that they can get the same merchandise under the same store banner at a lower price. That's a legacy of the recession, but one that's not going to go away quickly.

That means the Limited and other mall chains (especially apparel chains) may have little choice in going the outlet route, even though that risks cutting overall margins. In practice, regularly shopping malls are beginning to suffer from the "showrooming" effect—not necessarily for customers who will buy on Amazon, but those who will shop in-store at the mall and then buy from a store in an outlet mall. For a pure-play shopping mall chain, the choice is either expand into outlets or hand the business off to a competitor who already has.

For more:

- See this Columbus Business First story
- See the Limited's news release

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