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Destination Retailers Feel No-Go Mood

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The Associated Press

The Tampa Tribune

Published: July 29, 2008

CHICAGO - Consumer spending is down and gas prices are up. That's bad math for the scores of destination retailers across the country that want customers to fill up the tank for a gas-guzzling day of retail therapy.

So to cajole shoppers into stores, some of the nation's chains are changing marketing strategies, launching in-store classes and drumming up other special events aimed at getting road-tripping shoppers to pump up sales.

Customers at Bass Pro Shops drive an average of 100 miles to reach the company's 50 locations and many are known to drive up to 300 miles each way to spend time at the massive outdoor supercenters.

But with the average price of a gallon of regular gas about $4, getting even the most devoted customer to make the trip is becoming increasingly difficult.

That's why the Springfield, Mo.-based chain is launching a slate of events this weekend, offering shoppers outdoor skills workshops, s'mores-making, scavenger hunts and foam shooting competitions.
Bass Pro Shops spokesman Larry Whiteley says foot traffic in stores is falling, but the company hopes this weekend's events give customers more than just one reason to make the drive.

"We're teaching them how, for less than $100, they can have their own camping outfit and they can go to a lake or a campground or they can use it in their own backyard," he said.

'A Retailing Transformation'

As gas prices rise and food prices soar, the American shopper is scaling back: driving less, postponing major purchases, putting off vacations, cutting back on their shopping expenses.

That means those shoppers who do make purchases are making them closer to home.

It's a trend George Rosenbaum, co-founder of Leo J. Shapiro and Associates, calls a retailing transformation.

"Any store that has significant dependence on drawing traffic from more than 30 miles is going to have pressure on it," he said.

Candace Corlett, president of WSL Strategic Retail, worries about what kind of long-term effect the changing shopping patterns could have on the nation's retailers - particularly those such as Ikea, Cabela's and far-flung outlet malls - whose brick-and-mortar business models require shoppers to spend hours in a car.

"Not only is it far away, so it's a gas-guzzling trip, they're selling merchandise that's a purchase that can be postponed, and they're the type of retailers where there's too much temptation," she said. "If you go into Ikea with nothing in mind, you come out hundreds of dollars later. This isn't a time when people are proud to be buying lots of stuff."

Just ask John Wallace and his wife, Margot.

The Olivenhain, Calif., residents, who visited a Cabela's sporting goods store in Nebraska during a cross-country road trip to see family, say they can still afford the nearly $5-a-gallon gas in their hometown. But they're still bundling shopping trips into fewer stops, sharing rides with friends for longer journeys and scrapping visits to other faraway destinations altogether.

"I think everybody's trying to become a little more wise and savvy," said Margot Wallace, 50.

But not all destination retailers are feeling the squeeze.

Exceptions To The Rule

American Girl stores - veritable wonderlands for doll-loving girls and their parents - are seeing increased traffic this summer.

Stephanie Spanos, a spokeswoman for the doll maker owned by Mattel, attributed the increase to the movie "Kit Kittredge: An American Girl," showing in theaters nationwide.

At the Mall of America in Bloomington, Minn., foot traffic is up, too - thanks largely to the 1.5 million international shoppers who were lured to the mega-mall in the past year by the weakened U.S. dollar.

But officials say they're still changing their advertising strategy, spending more money in markets a day's drive from the 520-store mall. They hope the targeted campaigns offset any potential decrease in far-flung shoppers deterred by the high price of fuel.

"We're always out there hustling to get the word out," said spokesman Daniel Jasper. "But we've been a little more aggressive this year, to be honest."

The same goes for Cabela's, whose stores routinely draw shoppers from three hours away. The Sidney, Neb.-based retailer known for its elaborate, one-of-a-kind stores is launching a new display advertising campaign with a gas-saving theme, encouraging shoppers worried about fuel prices to scrap in-store visits for online or catalog orders.

"We can hopefully direct customers to those channels so they don't have to fire up the car," said spokesman Joe Arterburn, who said the company is likely drawing fewer in-store shoppers from great distances.

"Everyone is tightening their belt."

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