How Will A Decrease in Foot Traffic Impact the In-Store Environment?

What is the social and economic impact of declining foot traffic at malls around the country? To get insight into this question the Host of Retail Refined, Melissa Gonzalez, sat down with Karen Bomber, the Vice President of Global Marketing for Honeywell, at NRF 2022 to discuss the direct correlation between foot traffic and the greater economic trends of the area.

The rise of online retail in recent years has led to the downfall of many brick-and-mortar storefronts. Traffic at malls is down, and many retailers are struggling to compete with the convenience and efficiency of online shopping.

Without a doubt, the single biggest factor in the decline of foot traffic at shopping malls has been the rise of online shopping. 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.

The physical experience of shopping is important to many people, even those who buy most or all of their goods online. In fact, some customers are so used to shopping online that they feel uncomfortable buying in person with cash — they prefer to shop online where they can pay with a credit card and get free shipping.

Malls and large retail chains have suffered from these trends and from competition from other forms of entertainment such as 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 Rate of Crime Can Increase

fWith so many people shopping online, foot traffic has decreased not only in brick-and-mortar retail stores but also in the surrounding neighborhoods. Studies have shown that there is a direct correlation between foot traffic and the safety of an area. More foot traffic means more eyes on the street–eyes that can reduce crime.

The decrease in foot traffic is influencing not just retail stores but also local businesses, schools, and neighborhoods where foot traffic has declined and crime has increased.

An increase in crime due to a decrease in customers has forced many retailers to close their doors. Local businesses have seen a decline in customers and revenue as well, because they rely on those shoppers for business. Schools have reported a decrease in students enrolled because families have moved out of the area or are facing financial hardship due to lost wages due to unemployment.

The condition of these affected areas has deteriorated due to lack of investment, which has lowered property values throughout the city or neighborhood.

Foot Traffic is Most Affected by the Product Assortment

The product assortment is the single most important factor affecting foot traffic. Different retail channels carry different product assortments, and this drives foot traffic (and sales). Warehouse clubs carry a much larger assortment than department stores, so they can draw more customers by offering a larger selection of products. Department stores are limited in the number of SKUs they can offer customers. If they carry too many SKUs, it becomes difficult for customers to find products, and sales suffer as a result.

Competition is also a factor in foot traffic and sales

The competition also impacts foot traffic and sales positively or negatively depending on whether you’re the leader or follower. When one store reduces its price, other retailers typically follow, which increases the number of shoppers shopping at that retail channel and attracts additional foot traffic. Such competition makes other retailers increase their advertising spending to attract more customers.

More Stories Like This

Pop-Up Retailers Will Finally Have Analytics to Chart Success

Having Funding Isn’t Enough, Entrepreneurs of Color Need an Ecosystem of Resources

Follow us on social media for the latest updates in B2B!


Retailers Need to Enhance Omnichannel Consumer Experience to Benefit
December 9, 2022

According to the National Retail Federation, almost 200 million consumers were shopping over Thanksgiving weekend. The NRF reports that “the total number of shoppers grew by nearly 17 million from 2021 and is the highest figure since NRF first started tracking this data in 2017”, this growth being in large part to the record-breaking […]

Read More
Honda autonomous driving
Honda Autonomous Driving is the First Level-3 System from US Manufacturer
December 9, 2022

Watch out Tesla – Honda has announced their latest innovation in autonomous driving with “Sensing 360.” Honda plans to roll out this technology suite globally in 2024. Honda autonomous driving will feature assisted driving features like “Autonomous emergency braking with expanded cross-traffic, pedestrian detection capabilities, front cross-traffic alert, active lane-change assist (blind-spot monitoring), [and] […]

Read More
Tesla electric semi-trucks
What Tesla Electric Semi-trucks Mean for Pepsi Co. and the Trucking Industry
December 9, 2022

Elon Musk recently shipped the first order of the Tesla electric semi-trucks to Pepsi Co. with a few more companies to follow in coming months. This marks the beginning of Tesla’s new long-range hauling vehicle finally hitting the road and entering into the shipping and hauling industry. Bob Galyen of Galyen Energy LLC notes that […]

Read More