Brokering a Deal, Carefully, Between Malls and the Web

ByLouise Story

While more and more stores have found ways to do business, or at least promote themselves online, shopping malls have not found an easy way to get along with the Internet. Their Web sites have had little more than directions and a list of stores.

But NearbyNow, an Internet start-up based in Mountain View, Calif., offers something more substantial. Malls use its service to list the products for sale, and the prices, at any of their stores. These will be on the mall’s site, of course, but more important, they will be available to search engines.

A person who searches on Google, for example, for skinny jeans and Trumbull, Conn., will see a page for the Westfield Mall there with the roughly 20 stores that have skinny jeans. Shoppers can click on those retailers and sign up to receive an e-mail or text message in 10 minutes saying if their size is in stock. They can even put the product on hold there with a click.

But the malls hardly have a live-and-let-live attitude toward the Web. To persuade malls to join on, NearbyNow had to promise them that it would not run any ads from retailers that only sell online. If someone searches for toys on NearbyNow, for example, he will not see an ad for eToys.com.

“The big fear is ads from online retailers,” said Scott Dunlap, chief executive and president of NearbyNow. “We tell the mall: we’re only going to allow advertisements from advertisers that are inside the mall. That way we’re aligned in interests.”

And NearbyNow, in return, doesn’t want any fraternizing between the malls and the search engines. In particular, it wants to promote its mobile shopping service, which lets shoppers find information about products on their mobile phones while they are in stores. Afraid that Google and Yahoo will extend their own shopping sites to mobile phones, NearbyNow made malls agree they will promote only NearbyNow within their malls as the mobile phone service to use to search for products and pricing. Yahoo and Google declined to comment on NearbyNow’s arrangement with the malls.

About 1 million people are visiting NearbyNow mall sites per month now, Mr. Dunlap of NearbyNow said. About 55 percent of those customers come into a mall within 48 hours, he said, making them very attractive eyeballs for advertisers.

NearbyNow introduced the service just over a year ago, and since then has grown from four malls to 192. The company is now in all United States-based Westfield malls and all 83 owned by CBL Properties.

Executives at the mall companies said they hoped NearbyNow would help them fight back against online retailing.

“Instead of coming to the malls, people are shopping at home, and that’s pulling sales out of our malls,” said Lisa Moore, new business account manager at CBL Properties. “The beauty of this program is we’re trying to drive shoppers to the malls and to keep them from purchasing online.”

Source NYTimes Online

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