As Consumer Sentiment Improves New Revenue Growth Seen In Urban Retail Environment
Major retailers that have shunned the urban market are configuring their traditional suburban operations in creative ways to reach new customers. The gentrification of the inner city over the past decade and the slow recovery is making retailers look to in-town neighborhoods for growth.
- Fayetteville, NC (1888PressRelease) September 25, 2012 - Urban retailer optimism is reflected in surveys of confidence conducted by the Bloomberg Consumer Comfort Index which showed that Americans' view of the economic outlook climbed to a four-month high in September. This was backstopped by the Thomson Reuters/University of Michigan preliminary sentiment index rose in September to the second- highest level in five years. "People are feeling a little less negative about the economy," Laura Tyson, an economics professor at the University of California-Berkeley who is a member of Obama's jobs advisory board, said in a Sept. 19 interview in Washington with Bloomberg editors and reporters. "You are beginning to see people thinking more about housing in a normal way."
In an effort to maintain revenue growth suburban big box retailers are looking toward urban centers to grow revenues in this slow economy. The most common approach is to shrink the footprint and offer very targeted inventory as a result. However, merely changing the size of the box is not a silver bullet to successful urban retailing. Big box stores will face challenges in determining the right price point portfolio ranging from discount items to premium offerings to insure what is in the store will match the more diverse ethnic and income that shoppers will have during their visit. Furthermore, they can expect to face a learning curve in positioning the store as somewhere customers will seek out to "restock" day to day items or look for items to add or replace items in their homes. Grocery stores have always faced this challenge but housewares and clothing retailers to be successful must also solve this riddle in the urban market.
TJ Jenkins of WriJen a full service advertising and marketing firm based in Fayetteville, NC believes companies with little experience in the urban market will face a very subjective barrier. "There is a high degree of loyalty to retailers that have provided goods and services to urban centers versus newcomers that have avoid these markets in the past. The bloom falls off the rose quickly once the "newness wears off and the day to day competition settles in for the long term and that will be a tough bond to change". Even the World's largest retailer, Walmart has stumbled in this regard and the logistics of supporting high volume , heavy foot traffic stores can make or break even the best suburban retailer.
TJ Jenkins of WriJen Company a marketing strategist for several urban retailers , restauranteurs and entertainment venues is enthusiastic about the new entrants into the market and the creative approaches they see on the horizon. "All in all the urban market presents opportunities for suburban retailers but it is not for the weak of heart and will test the mettle of the companies looking to expand and maintain revenue growth as this economy slowly recovers for a tough 3 years".
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