24 Sep 2021 • Retail
Why are retailers going rural?
Retailers are fleeing cities in pursuit of a better life. From pastoral China to the Australian outback, such remote stores have the power to help rebuild rural economies; these brand outposts are not simply following the urban exodus, but driving it.
City centres, and the retailers that operate within them, were debilitated by the pandemic. It’s a battle that many have seen from the frontlines, with little choice but to shut up shop in response to declining customer activity. With a prediction of a 67 per cent drop in city centre retail footfall this year, Brightpearl found that almost a quarter of retailers (24%) in January 2021 said they would be closing physical stores this year.
The future isn’t as pessimistic as it appears, however. The same study found that almost one-in-five retailers (18%) plan to move stores out of major city centres and into local high streets within the next 12 months.
Such a move makes sense – these retailers are simply following their customers. With isolation placing greater emphasis on the importance of nature, one in seven Londoners wanted to leave the city as a result of the pandemic, according to London Assembly. And it’s not necessarily the open countryside they are fleeing to. Data by HireAHelper highlights how Americans are swapping San Francisco, New York and Los Angeles for small and medium-sized cities (SMCs) like Scottsdale, Durham and Columbus.
This creates a rare opportunity for non-urban retail to flourish. ‘Suburban-type stores have done better than the urban stores,’ says Peter Nordstrom, president of Nordstrom. While for Starbucks’ chief executive Kevin Johnson, ‘transactions in the current environment have migrated from dense metro centres to suburbs and from cafés to drive-thrus.’
China's Gangtou Culture House shows how retailers can embed themselves in new rural developments.
Small-town state of mind
While retailers have long prided themselves on their prodigious city centre flagships, it’s the smaller branches where footfall is surging. According to research by Springboard, the UK’s high-street footfall was double that of shopping centres in June 2021, with retail activity rising by 37 per cent week-on-week in coastal towns and a quarter in historic towns.
Luxury department store Bloomingdale’s has recognized the fact that 79 per cent of global consumers are planning to continue shopping in neighbourhood stores. Its smaller-scale format Bloomie’s has recently debuted in Fairfax, Virginia, and, with a focus on curation and convenience, it will serve as a reactive retail hub for locals. Harrods has similarly challenged its historic association with central London via the development of its H beauty stores in locations such as rural Essex and forthcoming sites in smaller metropolitan areas like Bristol.
Meanwhile in Japan, a high-end fashion designer seeking a home for his latest concept store has snubbed Tokyo and Kyoto in favour of Tottori, the country’s least populated prefecture. Les Six, the most experimental retail offering by Ryohei Kawanishi yet, is located in two Taisho-era warehouses, one featuring the designer’s menswear; the other his favourite art publications. An open workshop, in which local grandmothers are invited to help craft the garments, offers further intimacy.
After spending years in London and New York, Kawanishi describes returning to his roots in Tottori to set up the shop: ‘After years spent in London and New York surrounded by art and fashion people, I’m now learning something else. Fifteen years of living abroad has brought me a clear vision of where I am from, and where I want to go.’
Cover and above: Bridge Gallery is situated in an ancient settlement in China's Anhui province.
China’s rural opportunity
In China, border restrictions are expected to remain in place until at least 2022, according to Reuters. What this means is that Chinese consumers’ lucrative travel retail spend – which accounts for 30 per cent of global travel retail sales, according to Morgan Stanley – is being rerouted to domestic destinations, in turn buoying the nation’s economy.
For China’s rural areas, which have faced high levels of unemployment and increased poverty as a result of the pandemic, decentralising economics is particularly crucial. And while most of the responsibility has fallen on the hospitality sector, retailers too have a part to play in helping drive pastoral tourism.
Bridge Gallery is a bookshop located in Taoyuan Village, an ancient settlement in the eastern province of Anhui. The architects, Atelier Lai, are on a mission to cultivate the local area, using the bookshop to provide both economic and cultural opportunities for the village. The architects transport urban, gallery-inspired interior design to the historic settlement, inviting visitors to immerse themselves in literature in a serene yet contemporary hideaway.
More ambitious projects such as Gangtou Culture House show how retailers could embed themselves in new rural developments that straddle the past and future. The 600-year-old Gangtou Village is being revitalised by Other Projects , using traditional Cantonese materials to build a next-generation cultural centre that features everything from a tea house and learning centre to retail spaces and guesthouses.
Located in Australia's Great Victoria Desert, the Remote Store One launch emphasizes Vollebak's identity as an extreme adventure brand.
In the coming years, we can expect to see rural retail be taken to new extremes, as brands pop up in surprising locations to mix up their bricks-and-mortar strategies, as well as motivate their most loyal customers.
In late 2020, technical-clothing-brand Vollebak announced its first ever physical stockist. However, this stockist was in fact ‘the most remote store on Earth’ – or the Tjukayirla Roadhouse in the middle of Western Australia’s Great Victoria Desert. By launching its merchandise in a store with no neighbours for 264km, the outdoor goods brand invited customers to drive for three days along an unsealed sand track from the nearest city. Those who make the trek would discover that the store’s owners, Carol and Ross, can charge whatever they want.
According to Vollebak, the Remote Store One launch emphasizes the retailer’s identity as an extreme adventure brand. ‘Our gear is made for anywhere on the planet, from the hottest deserts and densest jungles to the polar ice caps. So it seems right that the last outposts in the wilderness carry our kit,’ states the brand.
Although Vollebak’s isolated retail store could be seen as a marketing campaign as opposed to a long-term strategy, it does hint at an exciting opportunity for the many retailers and designers who are seeking ways to break out of commercial city centres, shopping malls or high streets. For these decision-makers, remote developments can not only offer new forms of customer engagement – such as branded treks – but also disperse tourism, in turn benefitting the economies of forgotten communities.