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HOT KIOSKS AND CARTS

Some uncommon concepts cause a splash in common areas nationwide

By Debra Hazel

Specialty leasing by means of carts and kiosks is continuing to expand, and this year the offerings range from such traditional products as toys and Tupperware to live animals and personal pampering.

Still, determining the hottest specialty leasing tenants is a bit different from tracking their permanent, in-line brethren. By their very nature, temporary tenants come and go, sometimes staying for a season, rarely for more than a year. This may be particularly true now, according to temporary-leasing professionals. In years past, specialty leasing reps looked to in-line tenants to test or expand such products as fragrances or holiday goods in carts or kiosks outside department stores. Today the retailers are often mom-and-pop stores being supplied by a corporate manufacturer. And in a challenging environment, even the mall’s exterior is coming into play.

“I’m doing a lot in the parking lots, such as circuses and carnivals,” said Anne Michaels, director of specialty leasing at Colonial Properties Trust, Birmingham, Ala. “Those are popular.”

Following are some of the tenants and manufacturers that specialty leasing reps say they are seeking out to keep their centers entertaining and profitable.

AQUAMASSAGE
AMI International
Groton, Conn.
Product: Water massagers
Leasing contact: David Cote
(860) 536-3735

It looks like a tanning bed, but actually offers shoppers a brief, high-tech massage using pulsing water jets, while a plastic covering keeps them perfectly dry. Already used in medical facilities and now in more than 200 malls around the United States, Aquamassage (SCT, May 2002) is being expanded to shopping centers and airports worldwide and garnering attention from consumer media, including CNN and Good Morning America.

“The last two months have been a media frenzy,” said David Cote, president of AMI International, the Aquamassage manufacturer, speaking during the holidays. The company introduced Aquamassage to medical and fitness facilities more than 12 years ago. It then brought the device to shopping centers in 1999 through one unit in Texas, after which it rolled the concept into Florida.

“Then we started moving rapidly,” Cote recalled. “And we still have a lot of growth out there.”

The units cost $30,000 each and can be upgraded as new technology is developed. Acknowledging that he won’t get the entire mall universe, Cote said he nevertheless believes that there is potential for the company to have about 800 to 1,000 Aquamassage sites in U.S. malls. In addition, at press time the company had received approvals for airport units in Philadelphia; Amsterdam, the Netherlands; and Birmingham, England.

“There’s just so many places for us to be,” Cote said. “Every place where there’s people [and] tourists ... shopping and traveling,” including casinos and truck-stop retail. “There’s a big world out there, and the world is our market.”

KIDS MUSIC BOX CDS
Awesome Specialties
Mission Viejo, Calif.
Product: Personalized music CDs
Leasing contact: Tim Runner
(800) 854-8263

Until now, having a song written for someone required hiring a musician, but Kids Music Box CDs has gotten around that. Kids Music Box carts and kiosks allow shoppers to select one of eight different tunes in a variety of styles, from calypso to country, stored on a computer at the point of sale. The customer chooses from among 800 preprogrammed names one that will then be mentioned 38 times in the song.

Once the message and song are finalized, the cart operator enters a CD into a burner and creates the gift. Prices range from $19.95 to $24.95 for the CD, with a personalized label — Happy Birthday Joey, for instance — available for an extra dollar or two.

The product is geared to children 6 years old and younger.

“My kids love them,” said Deborah Georgetti-Piro, vice president of business development at General Growth Properties, which has Kids Music at some of its centers.

Cart operators purchase one computer already loaded with the tunes and a second machine for demonstration purposes from Awesome Specialties, the product’s Mission Viejo, Calif.-based distributor. The main computer holds three CD burners, allowing three gifts to be created at one time. An initial setup costs $7,000. Awesome Specialties is paid a small copyright fee for each CD sold.

The product can be sold from either a cart or a kiosk, though most vendors use carts.

“It’s successfully working in a wide variety of malls,” said Tim Runner, president of Awesome Specialties. “It really works everywhere.”

Family-oriented centers and tourist locations have been particularly successful. Georgetti-Piro reports that they’ve been known to sell $8,000 in product over a weekend, a healthy sum for a cart-based product. Most carts selling merchandise like this would see sales of $1,000 to $1,500 in a weekend, according to one industry observer.

Runner said Kids Music Box is a year-round concept.

“It’s entertainment for the kids,” he said. “And anything like that is worth its weight in gold.”

CRAB HUT, CRAB SHACK, CRABBY ISLAND
Florida Marine Research
Sarasota, Fla.
Product: Live hermit crabs and accessories
Leasing contact: Paul Manger
(800) 535-2722

Toys and music are not the only option temporary tenants are offering children. One company is supplying some youngsters with their first pets.

Hermit crabs, land-based crustaceans that vary from walnut- to softball-sized, make ideal pets for children between 5 and 15 years old, said Paul Manger, manager of wholesaler Florida Marine Research Inc., Sarasota, Fla. (This for-profit company is not related to the Florida Marine Research Institute, St. Petersburg, Fla.) The company sells the animals nationwide to carts and kiosks, operating under such names as Crab Hut, Crab Shack and Crabby Island.

The animals are hypoallergenic and carry no diseases that could be harmful to people, making them safe pets especially for the very young, he added.

“You can carry them around, and they will walk all over you,” Manger said.

As the crabs grow, they require larger homes, so cages of various sizes along with gravel and wood for the crabs to climb and chew on are available too, as are food and nutritional supplements to keep the creatures healthy.

Bonnie Praver, a senior vice president at New York City-based mall owner Shopco Group, likens the crabs to the rabbits sold as pets at Easter time.

“People buy them because they’re cute,” Praver said.

The first carts and kiosks opened in September, and Florida Marine now supplies between 70 and 100 units.

“With Generation Y, we have an enormous amount of children in the right age range,” Manger said, though he is less certain about how long the popularity will last. “To ask how viable this will continue to be — I don’t know.”

TUPPERWARE
Orlando, Fla.
Product: Cookware and storage items
Leasing contact: Shelley McKean
(407) 826-8490

Building on the tradition of home Tupperware parties that began in the 1950s and continue in today’s suburban homes, the Orlando, Fla., maker of food storage and preparation items has in recent years brought the party to regional malls, too.

A strategic assessment of distribution methods in 1997 led the company to explore a variety of additional venues for selling its products, including shopping centers, catalogs and at-home demonstrations.

“It became clear we were a respected brand and that consumers wanted access to us,” said David Halversen, senior vice president of business development and strategic planning at Tupperware. “We wanted to increase the visibility of our sales force.”

The company created the Integrated Direct Access program to reach customers whose personal representatives had moved or new shoppers who had yet to find a sales contact. Specialty leasing was one answer, and the company tested carts in five centers in November 1998. Helped with visual presentation by landlords including General Growth Properties, the carts were an instant success, Halversen said. One unit was tested in Orlando, and the company found that customers were driving from 50 miles away to shop.

“It went beyond what we really hoped,” he said. “People kept saying that the products were different from what they remembered. We also introduced new products. We realized this was a go.”

The program expanded rapidly over the next two years, and today Tupperware has more than 500 carts in malls in the United States, as well as in Canada and overseas.

Some units operate year-round, while other locations are seasonal, opening in the spring and during back-to-school periods and the holidays.

Carts are leased to Tupperware’s distributors, with the corporation helping them through the merchandising process and supplying wares. A small corporate team travels the country to assist in presentation and selling.

In addition to offering between 50 and 80 items, the carts provide an opportunity to showcase Tupperware’s full line through catalogs.

Shoppers can also ask cart operators to help them conduct Tupperware parties of other items that are otherwise difficult to showcase in the mall, either because of size or the room needed to demonstrate them.

Tupperware, which recently signed a distribution agreement with Target, is unsure of the number of carts the firm will operate this year.

But the company said it is too enthusiastic about its cart program to abandon it.

“The developers are great, and we would like to continue to expand,” Halversen said. “We love the environment. It’s a win-win for the developers and us.”

MICRORACERS
Awesome Specialties
Mission Viejo, Calif.
Product: Radio-controlled minicars
Leasing contact: Tim Runner
(800) 854-8263

Micro-radio-controlled vehicles are the latest thing zipping around the common area. The tiny rechargeable vehicles, less than two inches long and controlled by handheld radio units, can race around a track or any floor.

The product is as much a case of serendipity as of anything else, its vendors note. A Chinese importer approached specialty products distributor Awesome Specialties with the cars just as toy cart and kiosk vendors were looking for something new, said Tim Runner, president of Mission Viejo, Calif.-based Awesome Specialties.

“This whole phenomenon has just come out of the blue,” he said. “This didn’t exist last Christmas [2001].”

The models also replicate skateboarders and go-carts, but by far the mini race cars are the most popular. The cars run for several minutes between charges and can go quite fast. Some operators have set up tracks around their carts, with plastic barriers in place to keep cars from careering into the common area.

“They really charge around,” said Runner.

Carts operate under such names as MicroRacers and MicroQ, and require just $1,000 of inventory to get started.

The cars cost about $20 and have been flying off the carts, literally and figuratively, retailers say. In fact, more of them could have been sold during the holidays, but the West Coast port lockout delayed shipments of the product.

“The reorders are phenomenal,” Runner said.

Unlike Awesome Specialties’ Kids Music Box, which could easily run year-round, the micro cars are likely to have a more seasonal appeal, Runner said. As a result, he encourages the inclusion of other toy-related merchandise to help cart operators stay open all year.

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