Two people shopping for watches - featured image for the retail wealth migration article

The Great Wealth Migration to Rural America: How Retailers Can Stay Ahead

By Melissa Tatoris, VP Retail. Between 2020-2021, $68 billion of wealth moved from cities to rural areas, a shift reshaping the retail landscape. The U.S. is experiencing a wealth migration to rural America, particularly people moving out of cities, and most retailers are missing out. 

I know this firsthand. I was a diehard urban woman who treated shopping as both sport and therapy. My weekends revolved around Neiman Marcus, Nordstrom, and Starbucks—sometimes all in the same glorious outing. Then, life happened. I moved. Not just to the suburbs or the exurbs of Dallas, but to the rural suburbs, where I’m now surrounded by longhorns, horses, and the occasional alpaca. 

At first, I despaired—three Walmarts within five miles and not much else. But then, like a beacon of hope, I discovered a Nordstrom nearby. Naturally, I jumped in my car and drove like my shopping soul depended on it. But the experience? It was…different. The store had a different assortment, a different vibe, and a very different energy. 

Curious, I started talking to my new neighbors and a pattern emerged. My hypothesis still stands: The great migration of wealth and shoppers from urban hubs to more rural areas is real, but retailers haven’t caught on.

The Paradigm Shift: Wealth in Suburbia and Beyond

The migration of wealth from urban centers to rural and suburban areas is reshaping the retail landscape.  

IRS tax data highlights that post-pandemic, high income households are increasingly choosing to live in less densely populated areas. This also leads to shifts in purchasing power and consumer demand. 

This affluent household migration to suburban and rural areas means that these regions are no longer defined solely by their traditional consumer base. Historically, retailers like Pep Boys have tailored their inventory to local needs, such as stocking parts for Ford F-150s in rural areas. But with wealthier consumers now bringing luxury vehicles to these locales, they’ve reevaluated those local needs and made strategic pivots. 

And it’s not just vehicles, this applies to all segments of retail: restaurants, grocery stores, hardware stores, big-box stores, specialty stores or boutiques, and more.  

For retailers, this trend demands anticipation and reevaluation of inventory strategies, brand positioning, and pricing models to meet the expectations of wealthier, more discerning customers in these emerging affluent markets.  

Luxury Retail on the Rise in Rural Areas

Department stores such as Nordstrom, long known for their curated luxury collections in urban hubs, must rethink their regional strategy. By enhancing their product mix in suburban and rural locations to include premium and ultra-luxury brands, they can offer a customer experience that resonates with wealthier clientele.  

Imagine walking into a suburban Nordstrom and finding an expanded selection of brands like Gucci, Jimmy Choo, or Chanel—aligning with the expectations of new residents accustomed to high-end urban retail. They also want to see luxury travel in suburbs, not just urban centers. 

This same concept also applies across other segments. Home improvement retailers, for example, may be accustomed to lower or middle class DIY’ers. But to appeal to new residents, they should augment SKUs with more options across price points, including high-end styles and items that meet modern trends. 

Pricing Adjustments: A Strategic Opportunity for Retailers

Retailers also have an opportunity to revise pricing strategies based on the economic realities of these newly affluent markets. In areas where household incomes have increased significantly, certain products may warrant premium pricing. For instance: 

  • Grocers might introduce and price premium organic or imported food lines more aggressively. 
  • Endcaps could be updated with higher priced goods 
  • Home improvement stores could stock luxury appliances and fixtures at higher price points. 

The key is to balance accessibility with exclusivity, ensuring that offerings remain aspirational without alienating the broader customer base.

Localized Marketing and Personalization

The migration of wealth also underscores the need for hyper-localized marketing. Retailers should leverage data analytics to understand the specific demographics and preferences of their new customer base. Personalized promotions, exclusive events, and loyalty programs tailored to high-income consumers can drive engagement and build brand loyalty. 

Retailers could successfully drive up profit margin by understanding price conscious customers vs non-price conscious customers and offer promotional discounts to only those that need it to convert, saving margin from those that do not.  

The key here is to use data to understand who your customers and prospects actually are, not just what’s assumed. You’ll need to assess this frequently as demographics change.

Preparing for the Future: Strategic Takeaways

Retailers, here’s your wake-up call. A new strategy isn’t just a nice-to-have—it’s a must. Tune in to your evolving customer base, because the market is ripe for innovation, and there’s a whole new world of potential waiting to be tapped. 

As wealth migration continues to redefine the retail map, businesses that adapt proactively will thrive. The shift presents both challenges and opportunities for retailers ready to embrace change. By refining inventory strategies, enhancing customer experiences, and leveraging data-driven insights, retailers can position themselves to meet the demands of a more affluent, dispersed customer base—and ensure long-term growth in this evolving landscape. 

  1. Reassess inventory mix: Conduct localized market analysis to identify new demand patterns. Expand inventory to include luxury or premium products where applicable. 
  2. Optimize the customer experience: Invest in training staff to deliver a high-touch shopping experience that aligns with the expectations of affluent customers. 
  3. Adjust pricing models: Evaluate opportunities to introduce premium pricing for high-demand items while maintaining a competitive edge. 
  4. Enhance omnichannel integration: Offer seamless online and offline shopping experiences, including concierge services and curated product recommendations, catering to busy, high-income households. 

To learn more about how Zeta’s AI-powered marketing platform and Data Cloud can make it easy to evolve with the great wealth migration, request a demo. 

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