Rural retail businesses play a critical role in their community and are important to local culture and economic development.
Hye-Young Kim, with the University of Minnesota College of Design, answers questions about what rural retail revitalization is, why rural retailers are so vital to the state’s economy, and strategies for how these retailers can remain competitive in 2019 and beyond.
Q: What is “rural revitalization”?
Professor Hye-Young Kim: The word “rural revitalization” may mean different things to different people. But to researchers in the area of retail business design, rural revitalization means sustaining rural retail vitality and resilience against external forces. The rural retail landscape has significantly changed over the past decade and rural retailers have been hit hard. To respond to this changing environment, strategies and innovations are needed that can contribute to rural vitality and resilience.
Q: What are the current issues facing rural retailers?
Professor Hye-Young Kim: Rural retailers—especially small independent retailers—are extremely vulnerable. These small business owners do not have enough resources to invest in advanced retail technology or competitive experience design. Shrinking rural retail is directly linked to the decline of the local community, creating a domino effect of declining population, declining workforce and declining tax revenue. Without thriving small retailers it is hard to establish a vibrant community where people can experience something together collectively—where they can gather, communicate and connect in town.
Q: Why are rural retailers so important to the state’s economy?
Professor Hye-Young Kim: Rural retailers contribute to the state’s economy in several key ways. They create jobs, encourage entrepreneurship and enhance the local government’s financial sustainability by expanding and diversifying the tax base. More importantly, they improve local residents’ quality of life with new services and amenities and attract new residents. This outcome creates a chain reaction leading to population growth and the formation of a workforce with a wide range of skills and education levels that can help local businesses grow, and attract new businesses.
Q: What is the best advice you can offer for rural retailers to stand out in today’s competitive retail environment?
Professor Hye-Young Kim: Research consistently shows that when consumers go to stores, they have different expectations. They look for something unique, something that can only be achieved in an actual, physical store environment. They seek experiences. Responding to this evolving consumer need, the concept of retail experience design has become a key strategic focus for store retailing. By creating a more immersive retail experience, rural retailers can drive people toward their stores and ensure they leave not just with products but also memories.
Q: What is the University of Minnesota’s College of Design doing to help create opportunities for rural retailers?
Professor Hye-Young Kim: Faculty and students in the College of Design use the power of design thinking to revitalize rural retailers. They work closely with community partners and UMN Extension to engage in outreach teaching and research. They provide retail business design workshops for rural retailers in Minnesota and assist as design experts/consultants to solve unique, specific problems individual rural retailers face. They also create a knowledge base for rural retail revitalization and develop a best practice guide for local economic development staff to use to duplicate these efforts.
Hye-Young Kim, Ph.D., is an associate professor in the Retail Merchandising Program in the College of Design at the University of Minnesota. She also serves as the director of the Center for Retail Design and Innovation (CRDI) and the undergraduate program director of Retail Merchandising. Kim’s research interests include consumer behavior, strategic retail management, rural retail revitalization and ethnic minority entrepreneurship.