We’re currently witnessing an unprecedented retail crisis in which America’s largest retailers are being forced to shut down. 34,700 employees were let go in March alone and companies are closing stores at a heart-stopping rate. Is this the death of retail? Are brick-and-mortar stores becoming a thing of the past? I break it down below.
“The Retail Apocalypse” is a very real thing and every retailer should be on high alert. Nonetheless, this is not the death of physical stores. We’re experiencing a period of corporate Darwinism. E-commerce is the undisputable way of the future. The rise of companies such as Amazon is a testament to that. Amazon, in particular, is the company to watch. In 2006, they were worth $17.5 billion. At the end of 2016, Amazon was worth $385 billion. Compare that to the overall value of traditional retailers during the same 10 year period. Sears lost $27 billion, JCPenney lost $15 billion, and other, more fortunate companies were lucky to be cut in half.
So how can retailers compete with internet powerhouse companies?
Keep the Balance
E-commerce is not the complete solution. It’s a start, but there’s so much more. This is where major brands like Sears fail. There’s a balance that needs to be maintained between physical and virtual. Sears started closing brick-and-mortar locations to focus on e-commerce. It’s not enough to build an online store and sell products. It’s also not good to remain “old-fashioned.” You must keep up with consumer demands.
People have come to expect an ultra-modern and well-connected buying experience. When a customer walks into an actual store, they feel more connected to the buying experience. This is where traditional retailers have an advantage over internet-only companies. If you are able to provide a welcoming storefront and a well-built online store, you’re halfway there.
Connect and Integrate
The next step is integration. Point-of-sale systems in your physical locations should be connected to your online store. It’s a great idea to have a mobile app that will keep customers connected digitally as well as assist them in their physical shopping. Some companies allow people to check out at the register using their smartphone. The goal here is to give the same experience whether the customer chooses to buy online or in person. That’s where everyone gets it wrong. The entire world doesn’t want to go completely digital quite yet. If you provide customers with a high-tech, well connected physical shopping experience, you’re sure to be successful.
I could write about this topic for days and break down different strategies used by various companies. If you’d like to hear more, please be free to leave a comment or email me- [email protected]