With the rise of enormous retailers such as Amazon and Target, it can be a bit overwhelming for smaller retailers to compete. But there’s no need to fear. Mike Rittler, head of retail card services at TD Bank, believes there are many things retailers can do to bring in more foot traffic. Current home buying trends show Millennials are looking to live in cities with easy access to amenities.
“This shows that brick-and-mortar stores will continue to exist and flourish,” Rittler said. “Consumers love to engage in different channels, do their research online and then visit the stores to see the items. Ultimately what matters is who makes the customer feel more comfortable.”
Target is even transitioning to a brick-and-mortar strategy, planning to open more than 130 small-format stores by the end of 2019. They are relying on smaller stores with a more curated inventory and convenient locations to fit the needs of the surrounding population to help boost sales. Already, Target has two small-format stores in the Manhattan area, with others scattered around New York. Rittler said this is a strategy for larger companies wanting to put their stores where the people are.
“More and more of these specialty locations are popping up,” Rittler said. “They want to have convenient locations and be available for customers. As time goes on, you’ll see more and more small-format stores.”
A map from howmuch.net shows where Millennials are buying homes in the U.S. They seem to be gravitating toward cheaper,larger cities. The areas in Minneapolis, St. Paul, and Bloomington have the highest rate of millennial homeowners at 42%. The average house value in this area ranges from $200K to $300K. The areas in Los Angeles, Long Beach, and Anaheim have the lowest rate of millennial homeowners at 17%. The average house value in this area costs more than $500K.
The economy is more stable in places where people are buying homes, and people who are confident with the state of the economy will inevitably buy more. Rittler says that especially this year, there has been a lot of optimism about the economy. The sentiment right now is the highest it’s ever been, and people are feeling good about where they are in life. Holidays always bring more foot traffic into stores, and Rittler is expecting this summer to be strong with the holiday season. “It’s a good time to be a retailer,” Rittler said. “People are out there and ready to buy.”
With Millennials moving to areas where they can easily walk to the nearest convenience store, this creates a great opportunity for independent retailers to stand out. Customers are always looking for a unique, authentic shopping experience and this is something that smaller retailers have perfected. People are more likely to come back to a store if they feel they’ve had a one-of-a-kind experience. As Rittler says, “Foot traffic plus a good relationship equals a win.”