What is the impact on the economy and society of declining footfall at malls throughout the country? This question was answered by Retail Refined’s Host. Melissa Gonzalez, sat down Karen BomberVice President, Global Marketing HoneywellTo discuss the issue, please visit NRF 2022 There is a direct correlation in foot traffic and greater economic trends in the region.
Many brick-and mortar stores have seen their fortunes decline due to the rise of online retail. Many retailers are finding it difficult to compete with online shopping and the decreased traffic at malls.
Online shopping is without doubt the most important factor in the declines in foot traffic at shopping centers. The convenience and cost savings of online retail may be too much for some shoppers to resist, but there’s still something to be said for the personal touch of brick-and-mortar stores.
Many people value the physical experience of shopping, even if they shop online most of the time. Some customers have become so used to shopping online that they don’t feel comfortable buying in person with cash. They prefer to shop online, where they can pay with credit cards and get free shipping
These trends have caused malls and large retail chains to suffer, as well as competition from other forms entertainment like casinos, racing tracks, and concert venues. Some retailers have tried to adapt by opening smaller stores that are easy to get into and easy to get out of think dollar stores but it’s a tough space. It’s possible that high-end luxury stores could be successful in malls because they have such a strong brand presence, but even luxury brands are having trouble staying profitable in brick-and-mortar spaces because their profit margins are lower than those for apparel retailers.
The Crime Rate Can Increase
Foot traffic has dropped in surrounding areas as a result of the increasing number of people shopping online. Studies have shown a direct correlation between footfall and safety in an area. More foot traffic can mean more eyes on the streetseyes that can reduce crime.
The decline in foot traffic is not only impacting retail stores, but also local schools, businesses, and neighborhoods where crime has increased.
Many retailers have had their doors closed due to increased crime and decreased customers. Local businesses have also seen a decline of customers and revenue, as they rely on their customers for business. Schools have reported a decline in students because of families moving out of the area, or being faced with financial hardship due to losing their wages.
These areas have suffered from poor investment, which has led to a decline in property values across the city and neighborhood.
Foot Traffic is most affected by the product assortment
Foot traffic is influenced by the product selection. Different retail channels have different product selections. This drives foot traffic (and sales). Warehouse clubs offer a wider range of products than department stores. This allows them to attract more customers and is a way to draw in more customers. There are fewer SKUs available at department stores. Customers will find it difficult to find products if they have too many SKUs. This can lead to sales decline.
Foot traffic and sales are also affected by competition
The competition also impacts foot traffic and sales positively or negatively depending on whether you’re the leader or follower. When one retailer reduces its prices, other retailers follow. This increases foot traffic and boosts the number of shoppers shopping at that particular retail channel. This competition causes other retailers to increase their advertising spend to attract more customers.
