Is the End Near For Retail Stores?


Computers, phones, the Internet—it feels like everything is mobile now. That includes shopping too. Online retailers are the new big thing. As mobile technology grows in sophistication and usability, consumers spend more and more time with their devices—that is, texting, playing games, and downloading apps. Modern consumers value convenience about all else, so if there’s a way to run errands on their phones instead of making the walk to whatever strip mall is within driving distance, they’ll do in a heartbeat. And the numbers are there to prove it. Revenue has risen over 25% in the past two years, and it’s still growing. It’s cheaper, more convenient, and comes right to your door: no wonder online vendors like Amazon, eBay, and are thriving. The only question is, what does this mean for the good old brick-and mortar retail store? Is the digital realm driving department stores to extinction, or is the act of “going shopping” too strongly embedded in consumer culture to ever go away?

Statistics point to the former. Up to 70% of retail jobs have vanished in the last decade. Sales growth has shrunk dramatically too. Even Black Friday, which once saw an average sales bump of at least 20% nation-wide, may lose out to Cyber Monday in coming years. Larger retailers like Target, Macy’s, and Nordstrom experienced a decrease in sales last November—and while consumers went crazy about Black Friday on their Twitter feeds, Cyber Monday had more positive user feedback by far. While consumers associated it with happiness, excitement, and convenience, Black Friday was met with disappointment, impatience, and concern. Clearly, the modern-day consumer prefers sitting on their laptops for good deals over driving to the store at four in the morning, only to be met with crowds and irritated sales associates.

But that doesn’t mean retailers are completely in the dark when it comes to the digital revolution. In fact, many stores have tried to convert to digital platforms in order to compete with Amazon, eBay, and other online competitor by redesigning their websites to allow for online shopping, and getting active on social media. Other retailers, like Macy’s, for example, have begun to introduce smartphones and tablets onto the sales floor,  to help customers navigate through the store and search for out of stock items without having to find a sales associate. But it’s possible that embracing mobile devices encourages consumers to use them for other purposes within the store.

Show-rooming, for instance, has become extremely popular among consumers  in the past few years. To clarify, show-rooming is a new purchasing trend where consumers will use their phones to check for cheaper product alternatives online, instead of simply buying it at the  physical retail location. Not only does this decrease sales, but it decreases the value of retail stores, turning them into showrooms where consumers can see the products they want in person before buying them online for a discount. This isn’t good news for the future of retail, but it doesn’t necessarily mean that department stores and shopping malls are gone forever. After all, not all retailers are flailing.

Take Apple, for instance. Walk into every mall and every Apple Store in sight is sure to be swarming with people. So will every Build-a-Bear Workshop or Sephora—and this doesn’t speak to the popularity of these brands, but to the way they’ve designed their retail stores, to make for an exciting, interactive retail experience. You don’t just buy a stuffed animal at your local Build-a-Bear; you make one yourself. And no one buys an Apple product, or a makeup kit from Sephora before a sales associate comes up and gives you a one-on-one tutorial on how to use it. But what makes these companies so successful? The secret behind retail is to focus on the consumers, rather than the sales you make. By spending more time on each individual who walks into the store —showing them how a product works, and how that product could work for them personally, companies like Apple create a unique shopping experience for customers to enjoy. Sure, anyone could buy an iPhone online, but most people make the trip to the Apple Store instead, just because it feels more like an outing, than an errand. And no matter how convenient online retailers may be, these stores provide a sense of place that Amazon just can’t replicate. Every marketer knows that the key to success is owning your point of difference. Apple and Sephora show us that it’s still possible to be different and successful in retail. But which retailer will be next to step up to the plate?