2024 Retail Trends: An Economic Development Perspective

The retail sector continues to evolve rapidly, driven by societal shifts, technological innovations, and new consumer behaviors. As 2024 unfolds, eight major trends are set to shape the future of retail, dining, real estate, and entertainment, with wide-ranging implications for economic development, particularly in Wisconsin and its South Central region. This analysis provides a deeper look at how these trends impact local economies, shape real estate decisions, and offer new opportunities for economic development strategies.

1. Star Power in Retail and Stadiums

The economic impact of celebrity-driven events is profound, and these opportunities extend far beyond the entertainment industry. For example, Taylor Swift’s Eras Tour boosted concert sales and drove foot traffic to nearby retailers, creating significant ripple effects in local economies. Similarly, University of Colorado football games under Coach Deion Sanders generated millions in local business revenue.

In Wisconsin, particularly South Central Wisconsin, events like the University of Wisconsin Badgers football games in Madison have long been an economic driver. Local businesses can maximize consumer engagement and spending by strategically aligning retail and dining promotions with significant events. The Dane County region, for instance, can take advantage of such trends by fostering partnerships between event organizers, retailers, and the tourism industry, creating a more integrated approach to economic growth.

2. Second-Hand Apparel on the Rise

The surge in second-hand retail reflects a growing consumer preference for sustainability and affordability. As more consumers, particularly younger demographics, turn to thrift stores and resale platforms, the second-hand market will likely continue growing.

In South Central Wisconsin, cities like Madison have already seen an increase in second-hand retail, driven by the eco-consciousness of university students and young professionals. This trend presents an opportunity for local economic development by supporting small businesses in this space. Communities can incentivize the opening of second-hand stores and create marketing campaigns highlighting both the environmental and economic benefits of thrifting, helping attract foot traffic and boost local economies.

3. Placemaking as the Core of Commercial Real Estate

Placemaking, the practice of designing public spaces that foster social interaction and engagement, is becoming a central theme in commercial real estate. Mixed-use developments that integrate retail, dining, entertainment, and residential spaces are transforming underutilized areas into vibrant community hubs.

This trend is particularly relevant in Wisconsin as cities like Madison and Janesville undergo urban redevelopment. Projects that emphasize placemaking can stimulate local economies by increasing foot traffic, extending dwell times, and creating a sense of community. For example, integrating more experiential components, such as green spaces, public art installations, and pedestrian-friendly areas in downtown revitalization projects, can boost economic activity and attract diverse visitors.

4. Experiences Drive Entertainment and Dining Visits

The demand for experiential retail and dining is on the rise. Consumers are seeking more than just products; they want experiences that provide social and emotional value. Movie theaters, restaurants, and even fitness centers increasingly incorporate experiential elements into their offerings.

South Central Wisconsin can leverage this trend by encouraging experiential businesses that cater to both locals and tourists. With its vibrant food scene, Madison could benefit from promoting more interactive dining experiences, such as farm-to-table events or culinary workshops, which attract residents and visitors from surrounding regions. This trend supports economic diversification, which can insulate the local economy from downturns in more traditional sectors like manufacturing.

5. Return to the “Old Normal”

As some pandemic-era shifts in consumer behavior revert to pre-pandemic norms, businesses need to adjust accordingly. For example, the resurgence of weekend grocery shopping and the slow return to office work are reshaping downtown economies, especially in cities with significant office space.

In South Central Wisconsin, where several corporate headquarters are located, such as Madison, economic development efforts could focus on supporting downtown businesses as office workers gradually return. This could include improving public transportation, investing in downtown amenities, promoting events that bring workers back to the city center, and helping revitalize retail and dining sectors that have struggled during the pandemic.

6. Retailers’ Suburban Shift

The migration to suburban areas is having a lasting impact on retail, with many brands expanding their presence in less dense, more affordable regions. As suburbanization continues, retail and dining establishments are following their customer base.

For cities in South Central Wisconsin, such as Sun Prairie and Fitchburg, this presents an opportunity to attract new businesses and foster local economic development in growing suburban communities. Economic development agencies can work with retailers to provide incentives for suburban expansion, ensuring that these areas can accommodate the rising demand for retail and dining options while creating jobs and stimulating local economies.

7. Grocery Mergers and Acquisitions

Consolidation in the grocery industry is set to continue, with larger companies acquiring regional chains to expand their market share. While this can present challenges for small, independent grocery stores, it also opens opportunities for economic development strategies focused on grocery deserts and underserved communities.

In Wisconsin, particularly in rural areas of South Central Wisconsin, grocery mergers could help bring more options to areas with limited access to fresh food. Economic development efforts should prioritize attracting grocery stores that can serve diverse populations, including low-income and rural communities, while supporting local farmers and producers through partnerships with grocery retailers.

8. Optimizing Retail Media Networks Through Offline Data

Retail media networks, which allow companies to leverage their digital and physical assets for targeted advertising, are gaining traction. Businesses can optimize their advertising strategies and improve customer engagement by using offline data to identify key consumer segments.

Economic development in Wisconsin, particularly in tech-forward cities like Madison, has the potential to support the growth of retail media networks. Local businesses and startups can benefit from training and tools that help them harness data-driven advertising, thereby improving their competitive edge in an increasingly digital marketplace.

Conclusion

The trends shaping retail in 2024 offer significant opportunities for economic development in Wisconsin, especially in the South Central region. By aligning retail strategies with broader societal shifts—such as the rise of second-hand retail, the focus on placemaking, and the demand for experiential shopping and dining—local governments and economic development agencies can foster economic resilience and growth. Furthermore, by leveraging these trends to revitalize urban and suburban areas, Wisconsin can position itself as a leader in innovative, sustainable, and inclusive economic development.

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References: Placer Labs, Inc. (2023). "8 Retail Trends to Watch in 2024."