I believe Legoland sees an opportunity in the recession because consumers are looking for free or affordable cost entertainment in their malls. This trend also corresponds to a consumer who expects their news to be free on the web. Consequently, we see malls across the globe add entertainment and amusement venues to draw consumers who have relegated shopping to obligatory time, which is something close to work. These consumers are bored with the same stores in every mall and with higher gas prices, lost home values and depressed 401K accounts they do not have the funds for a shopping spree.

Yet, Legoland charges on with a strategy to open in Grapevine Mills mall in Dallas, TX and are they are looking for a location near the Georgia Aquarium in Atlanta. Additionally, the city of Dallas will give Merlin Entertainment, the operator of Legoland, a $1 million TIF (Tax Incremental Financing) incentive package to open in the mall. The facility is projected to open in March 2011 in 40,000 square feet.

Glenn Earlam, a managing director with Merlin, said in a statement that “the inclusion of a quality leisure attraction like the Legoland Discovery Centre will . . . deliver significant incremental business to both the mall, to the Dallas-Fort Worth Metroplex and the greater region as a whole.”

Likewise, Disney earlier this month announced that they are turning 340 of their Disney Stores into “entertainment hubs” and renaming them Imagination Park with the help of Apple’s Steve Jobs. The goal is to make children clamor to visit the stores and stay longer, perhaps bolstering sales as a result. Over the next five years, analysts estimate that Disney will spend about $1 million a store to redecorate, reorganize and install interactive technology. Some Disney board members fretted though that the concept was so lavish that parents would try to use the stores as day care centers. Others worried that people would come for the entertainment but not buy anything. Disney is pitting landlords against each other to try and get the best deals in top-tier locations.

The Middle East seems to be leading the trend with the biggest entertainment venues as attractions in malls. Examples include the 15,000 square foot Wahooo! Waterpark which just opened in Bahrain City Centre mall, and the now infamous Ski Dubai at the Mall of Emirates.

Ski Dubai located in Mall of EmiratesBut will these large financial investments hold up in the long-run? Or are they a 21st Century repeat of the previously failed versions of entertainment in malls, such as Warner Brothers, Gameworks, FAO Schwarz and Niketown? The 1990s saw the end of roller rinks in malls and affordable home video game systems killed the mall arcade.

With all the focus on entertainment will the new shops fail like many others in the past, especially when Target and Wal-Mart offer the lowest priced toys in a warehouse envirnoment?

Disney claims sales at its original stores, which opened in 1987 and sold to Children’s Place in 2004, plummeted because they oversaturated the market. However, many analysts believe that the stores’ visitation was high due to the entertainment but not enough people bought to sustain the rents and overhead.

I remember stopping in The Disney Store on every mall visit but only purchasing merchandise a handful of times. Is my experience the norm or a rarity?

Additionally, FAO Schwartz which was a New York destination failed when it tried to bring their concept to malls proving that high entertainment value does not always translate into high sales figures. So I ask the question, are these high investment entertainment venues going to last or are they a trend that will be a lecture in business school ten years from now?

A $12 million Legoland Discovery Centre, an attraction centered on the popular children’s building blocks, will be coming to Grapevine Mills mall, the city said Tuesday.

The only other U.S. Legoland Discovery Centre opened last year outside Chicago. Legoland Discovery Centre and the Legoland theme park in California are developments of U.K.-based Merlin Entertainment Group, reportedly the world’s second-biggest operator of visitor attractions.

The Grapevine City Council and the board of the Tax Increment Financing District No. 1, which was established several years ago for the mall, approved a two-phase, $1 million incentive package for the project. Merlin Entertainment will receive $500,000 when it completes the facility and $500,000 when it completes an accompanying 10,000-square-foot miniature golf facility made from Legos.

Construction should begin in June, with an anticipated opening in March 2011, the company said. The facility will occupy 40,000 square feet currently being used by Woodward Skatepark, which is across from the AMC Theatres. The golf facility will go in the outdoor plaza between the theater and the mall.

Simon Property Group owns the mall. Its local business representative could not be reached for comment.

Legoland Discovery Centres are geared to kids ages 3-12. Visitors often spend between two and three hours walking through the center and taking part in activities. Kids learn how Legos are built before venturing on to build with the blocks, see displays and ride Lego rides. There’s a cafe and rooms for birthday parties. Admission is $15 for children and $19 for adults. Annual passes are $40.

Merlin Entertainment said it chose Grapevine because the city is considered a “popular destination for family visitors.”

Glenn Earlam, a managing director with Merlin, said in a statement that “the inclusion of a quality leisure attraction like the Legoland Discovery Centre will . . . deliver significant incremental business to both the mall, to the Dallas-Fort Worth Metroplex and greater region as a whole.”

Grapevine Mayor William Tate said the project “will become one of the most unique and best family attractions in Texas.” City officials estimated that it could draw more than 300,000 visitors a year.

Legos, colorful snap-together plastic building blocks, are made by Lego Group, a private Danish firm.

The first Discovery Centre opened in Berlin in 2007. There is one in Germany, and a location is expected to open next year in Manchester, England, according to the company’s Web site. Atlanta might also add a location, according to media reports.

Merlin operates 59 attractions, six hotels and two holiday villages in 13 countries, including Madame Tussauds in New York, Washington, Las Vegas and Hollywood, Calif.

A Lego Education Center in Southlake, a venture of Lego and Pitsco Inc, is not part of Merlin.

It offers classes and educational activities geared to kids 3-12 using Legos to teach math, science, engineering, technology and art.

The Walt Disney Company, with the help of Steven P. Jobs and his retailing team at Apple, intends to drastically overhaul its approach to the shopping mall.

At a time when many retailers are still cutting back or approaching strategic shifts with extreme caution, Disney is going the other way, getting more aggressive and putting into motion an expensive and ambitious floor-to-ceiling reboot of its 340 stores in the United States and Europe — as well as opening new ones, including a potential flagship in Times Square.

Disney Stores, which the media giant is considering rebranding Imagination Park, will become more akin to cozy entertainment hubs. The chain’s traditional approach of displaying row after row of toys and apparel geared to Disney franchises will be given a high-tech makeover and incorporated into a new array of recreational activities. The goal is to make children clamor to visit the stores and stay longer, perhaps bolstering sales as a result. Over the next five years, analysts estimate that Disney will spend about $1 million a store to redecorate, reorganize and install interactive technology.

“The world does not need another place to sell Disney merchandise — this only works if it’s an experience,” said Jim Fielding, president of Disney Stores Worldwide. The company plans to unveil the new look in May in Southern California, Long Island and Madrid, and is close to signing a lease for that Times Square flagship.

Theaters will allow children to watch film clips of their own selection, participate in karaoke contests or chat live with Disney Channel stars via satellite. Computer chips embedded in packaging will activate hidden features. Walk by a “magic mirror” while holding a Princess tiara, for instance, and Cinderella might appear and say something to you.

It’s your birthday? With the push of a button, eight 13-foot-tall Lucite trees will crackle with video-projected fireworks and sound. There will be a scent component; if a clip from Disney’s coming “A Christmas Carol” is playing in the theater, the whole store might suddenly be made to smell like a Christmas tree.

The makeover happened only after much internal debate at the company. Indeed, some Disney board members fretted that the concept was so lavish that parents would try to use the stores as day care centers. Others worried that people would come for the entertainment but not buy anything.

“It’s time to take risks,” Mr. Fielding said he told them. “When consumers are ready to spend again, we will be ready.”

The involvement of Mr. Jobs, the Apple chief executive who joined the Disney board with the 2006 acquisition of Pixar, is particularly notable. For the first time, Mr. Jobs’s fingerprints can be seen on Disney strategy, in the same way that he influenced the look and feel of Apple’s own immensely popular retail chain. While Mr. Jobs did not personally toil on the Imagination Park concept, he pushed Disney to move far past a refurbishment.

“Dream bigger — that was Steve’s message,” said Andy Mooney, chairman of Disney Consumer Products.

Mr. Jobs provided access to proprietary information about the development and operation of Apple’s highly successful stores, and Disney executives visited Apple’s research operation in Cupertino, Calif. Mr. Jobs, who declined to comment, also insisted that Disney build a prototype store to work out kinks, a costly endeavor that most retailers skip.

The company followed his advice, working for the last year on a full-scale, fully stocked store inside an unmarked warehouse in Glendale, Calif. The prototype was crucial to shaping an overall philosophy, Mr. Fielding said, noting that he discovered the shops needed more “Pixar-esque winks and nods.” To that end, one sales area is now labeled “WWTD: What Would Tinker Bell Do?”

Disney will adopt Apple touches like mobile checkout (employees will carry miniature receipt printers in their aprons) and the emphasis on community (Disney’s theater idea is an extension of Apple’s lecture spaces). The focus on interactivity — parents will be able to book a Disney Cruise on touch-screen kiosks while their children play — reflects an Apple hallmark. Employees can use iPhones to control those high-tech trees.

Disney is a merchandising titan whose licensed consumer products generated $30 billion in global sales last year, up from $12 billion when Mr. Mooney joined the company a decade ago. But Apple is king of the mall. Its fleet of stores generated sales of about $4,700 a square foot in 2008, by far the highest for any retail chain, said Charlie Wolf, an analyst at Needham & Company. In comparison, Best Buy’s sales are about $1,000 a square foot.

The Disney board approved the Imagination Park concept on Oct. 1 after touring the prototype and receiving hand-made books from Mr. Fielding that pitched the concept as “the best 30 minutes of a child’s day.” Now Disney is bringing in landlords, trying to pit them against one another to secure top-tier locations and favorable leases.

“We will essentially be the only toy retailer left at the mall because everybody else has evaporated,” Mr. Mooney said. Mr. Fielding added, “Every mall in America is desperate for newness and freshness.”

The Disney Store chain, introduced in 1987, was initially so successful that the company overexpanded to more than 600 locations. Buffalo alone had five. But consumers overdosed on the animated-character merchandise and by 2002 the chain was losing about $100 million a year.

Judging the upkeep too burdensome and focusing on the safer licensing business, Disney sold the chain to Children’s Place Retail Stores in 2004.

But Children’s Place failed to meet contractual renovation obligations and consumers complained of poor service, Mr. Fielding said. The vaunted Disney brand was in peril. “Let’s face facts,” he said, “some of those stores looked like a dog’s breakfast.”

In March 2008, Disney bought back part of the chain on undisclosed terms and the remaining stores, about 100 of them, were closed. A spokeswoman for Children’s Place declined to comment.

Dressing up a toy store with entertainment is hardly new. F.A.O. Schwarz has its famous floor piano, Toys “R” Us operates a Ferris wheel inside its Times Square outpost and American Girl jazzes up its retail outlets with theaters and doll hair salons. But the emphasis on programming — via the theaters, Disney is essentially creating a mall-based television channel — and the degree to which the media giant is pouring on the razzle-dazzle in every store is unusual.

The nation’s largest mall operator, Simon Property Group, however, said Disney might be overly optimistic about how far landlords will bend. “No one comes in here and dictates terms,” said Bruce Tobin, a Simon executive vice president.

That said, however, Mr. Tobin had pinwheels in his eyes after touring the prototype. “It’s truly spectacular — beyond our imagination,” he said. “These are going to be true destinations.”

Versace
Recently announced it was closing all thirty (30) of its stores in Japan.

New World
A new world is likely to emerge in which designers rebel against long lead times and where they take their collections directly to the consumer through their own boutiques, trunk shows, and over the web.

Web Sales
Web sales are projected to reach $156 billion in 2009, representing 6% of the total U.S. retail pie

The Web Fashion Consumer
Consumers have come to expect new merchandise more frequently, thanks to the web and fast fashion retailers such as H & M. Many cannot understand why they have to wait 6 months to see the fashions seen on the runways. Buyers at department stores generally base their orders on the past, while fashion editors gravitate to the most photogenic and future looking styles, leaving the consumer stuck in the middle. This results in one facet of the fashion industry looking forward and the other looking backwards. The consequence: a consumer on one hand is told what to buy but on the other, not where to buy it.

In response, a new generation of fashion retailers is emerging on the web where news is freely given and fashion is sold. Net-a-porter with average sales of $820.00 per transaction and customers from 170 countries is one example of this new generation of merchants. The company has successfully merged its web retail site with a fashion news site catering to a new consumer who wants credible news over magazine advertisements and the most up to date fashion now.

Entertainment
Families spent 5.1% more on entertainment in 2008 than in 2009, something that has surprised many economists. As consumers tightened their pocket books and wallets one would expect entertainment to be one of the first categories to see significant decreases. But the 5.1% increase in spending equated to 16.5 billion more dollars spent in the category over 2007.

Household debt
The American family is trying to put money into savings and reduce their overall debt, but they are clearly not faring as well as one might expect in this recession. Household debt now amounts to about 125% of after tax income.

High Net Worth Individuals
Luxury retailers are faced with a significant decline in Americans with a high net worth defined as having $1,000,000 of assets available for investment. In 2008 the assets of these individuals dropped by as much as 22%. The result is a major decrease in sales at retailers such as Neiman Marcus where sales have decreased by over 20% in 2009 over 2008.