SAN JUAN, PUERTO RICO (June 30, 2020) - As enclosed malls throughout the United States begin their reopening process after COVID-19 shutdowns, owners and managers face two major questions: how to ensure that the number of guests inside the center complies with government guidelines, and how to regain the confidence of consumers that it's safe to enter, shop and dine.
Two U.S. centers already have answers. Plaza Holdings, Inc.'s Plaza Las Americas in San Juan and Plaza del Caribe in Ponce, Puerto Rico, in approximately 30 days uniquely integrated a pioneering reservations system app into its existing people-counting system that allowed both properties to reopen while assuring required social distancing (1 person per 100 square feet during Phase 1 of reopening). As importantly, the system informed and reassured their trade areas of 1.5 million and 714,000 million people, respectively, that management was carefully monitoring entry so they could be comfortable returning to the malls. The result has been a successful phased reopening, with some sales exceeding 2019 levels, according to Jaime Luis Fonalledas, executive vice president for the family-owned firm.
"Our goal has always been to provide a safe, comfortable and enjoyable experience for our guests. We've had the privilege of being a part of their lives for generations, and take that responsibility very seriously," Fonalledas said. "During COVID-19, that meant finding an easy-to-use tool which complies with government requirements, maintains safe social distancing levels and keeps our shoppers informed. By adding this reservations system to our existing people counter, we accomplish all of it. And it will provide benefits to all of us for years to come."
The largest mall in the Caribbean and the dominant enclosed center on Puerto Rico for 52 years, the 1.9-milllion square foot Plaza Las Americas in San Juan is anchored by Macy's, JCPenney and Sears. Approximately 50% of its mix of 300 retailers consists of national and international brands, including Michael Kors, Carolina Herrera, Sephora, Cheesecake Factory and P.F. Chang's. Located in Ponce, Puerto Rico's southern region, Plaza del Caribe's 858,000 square feet boasts JCPenney and Macy's as anchors and a similar mix of local, national and international tenants. Together, the centers reach 65% of Puerto Rico's 3.4 million population, with sales well above industry averages.
The two centers were closed on March 16 when the Executive Order signed by Governor Wanda Vázquez shuttered all nonessential retail. Plaza Holdings' ownership saw in April that as part of the reopening it would be critical to monitor visitation and regain shoppers' confidence by creating a reservations and communications system. Coincidentally, an app with basic information on both properties had soft-launched in January, so the team coordinated closely with Express Image Digital, the company that built that app, to develop an innovative integration with the existing people counting system.
"Plaza Holdings Inc. had the idea, and we worked very collaboratively to develop a reservation system nuanced specifically to meet the guest experience and operating needs of new normal malls," said Scott Morrow, CEO of Express Image Digital. "We don't believe there is a comparable system in the industry today, and we haven't seen that number of mobile app downloads in a three-week period."
Power of Teamwork
In around 30 days and at a modest investment, Express Image Digital, working closely with Plaza's team, added the new utility to the app and incorporated it with the people counting system, which was built by another company. The Plaza team then began promoting the app with a press conference held at the center, social media and radio, digital and television advertising. The company also hired a call center company to field queries about downloading and using the app. In less than a month, the center fielded more than 3,500 calls and nearly 500 text messages asking for assistance. The result was over 125,000 downloads during the first three weeks of the Phase 1 reopening, and a total of 130,000 so far.
Both malls reopened on June 1. In the earliest days of reopening, shoppers reserved one of two four-hour blocks, from 9 a.m. to 1 p.m. or 1 p.m. to 5 p.m. The guest received a QR code, essentially a ticket, that was scanned at the entrance; he or she also had their temperature taken by security. The staff was reorganized and trained to check the codes and use the temperature scanners prior to reopening. Employees received a different QR code, entered through different doors and were temperature-checked daily as well.
Once inside the center, guests shopped and dined as usual - the app reminded them of their deadline a half hour prior to the end of their reservation. As capacity restrictions eased, the visitation time blocks were extended, initially to 9 a.m. to 2 p.m. and 12 p.m. to 5 p.m. Currently, the time blocks are 9 a.m. to 3 p.m. and from 12 p.m. to 8 p.m. Monday through Saturday and 11 a.m. to 7 p.m. on Sundays.
Puerto Ricans were eager to do more than get out of the house - they went to the Plazas to shop, especially for tennis shoes as people began to exercise more during the shutdown, Fonalledas reported. Jewelry and other luxury goods are also top performers, as affluent Puerto Ricans are not traveling and are purchasing at home.
"Customers are coming back to the mall with a clear intention to shop and they know specifically what they want to buy," said Franklin Domenech, general manager for Plaza Las Americas. "In the first couple of weeks after reopening, we've seen traffic increasing consistently and, for some tenants, triple-digit sales growth when comparing it with the same days in the previous year."
Edwin Tavárez, General Manager for Plaza Del Caribe, agreed with the statement, adding that, "We are seeing more relevant traffic and remain confident for the rest of the year."
The Road to Recovery
That bodes well as restrictions continue to ease on the island, and stores continue to reopen. Reservations are no longer required but are recommended, because if the center is at capacity, a walk-in guest will be denied admittance; a reservation guarantees entry. Approximately two-thirds of Plaza Las Americas' and Plaza del Caribe's tenants (including restaurants) have reopened, Traffic is about 60% of normal, and is growing daily.
"Every week, we've seen an improvement in traffic and sales," Fonalledas said. "Our third week of Phase 1 opening, our traffic numbers had tripled and continue to grow at a swift pace."
Shoppers with reservations, once restricted to bringing two companions, now can bring in four people. Prior to the pandemic, Plaza Las Americas' shoppers visited an average of 4.1 times monthly, and a staggering 86.4% of the trade area's households visit the property. Plaza del Caribe's shoppers are equally loyal, with 85% of the trade area visiting 2.5 times per month. In late June, Plaza del Caribe even hosted a socially-distant graduation in its parking area.
In time, new features will be added to the application that will allow Plaza Holdings to offer more benefits to the customers while at the same time, the malls will learn more about their shoppers, and market to them more efficiently. Integrating the app with customer service stations and retail offers and securing reservations to space-limited special shows and activities (when they resume) are among the possibilities the marketing team is considering.
"Our recovery is well underway," Fonalledas notes. "Every day, we see more shoppers. With this new app, in time, we can learn more about their preferences and needs and use those learnings to create even more relevant experiences and services for them. This is the beginning of a new era for Plaza Las Americas and Plaza del Caribe."
About Empresas Fonalledas
PLAZA Holdings, Inc. is part of a privately-owned group of companies in Puerto Rico, with a tradition of quality business enterprises dating back to the late 1800s. The most recognized company of the group is Plaza Las Américas, a 1.9 million square-foot shopping center in San Juan. It was opened to the public in 1968 on approximately 70 acres located at the intersection of what would eventually be the main east/west and north/south freeways in San Juan. This site is adjacent to the Central Business District, is surrounded on all sides by the greatest demographic concentration of the entire Island and is only 15 minutes away from the port of San Juan, the airport, the Convention Center and most hotels. Plaza Del Caribe, on the other hand, is located in Ponce, the second largest city of the Island. With 858,000 square feet of retail space, the shopping center is anchored by Macy's and JCPenney and has more than 115 retail spaces.