Why Amazon won’t take over the world.
Or why physical retail isn’t dead.
If you listen to common wisdom, then you probably believe that brick-and-mortar stores are dying.
If you listen to common wisdom, then you probably believe online shopping is taking over the world.
The writing is on the wall, right?
Online sales now account for 9.1% of all retail transactions in the U.S. (and it’s growing every year) and big-name retailers — J. Crew, Abercrombie & Fitch, and J.C. Penny to name a few — are going out of business at an alarming rate.
It’s also what Amazon is banking on: the convenience of online shopping and a large-scale distribution network will get customers what they want, in nearly no time at all, and it will stop any of us from ever having to go to a store again.
But I don’t believe in common wisdom.
And I don’t want to live in a world like this:
There’s something bigger here, I can feel it…
It happened with farm to table, and it’s going to happen with retail: a return to local and a focus on unique.
Now let’s be clear. Amazon is amazing for commodities, but it’s terrible when it comes to style. If you care about what you wear or you want a gift that is thoughtful, you don’t shop on Amazon. You look for something different.
The problem is, Internet shopping for clothing and gifts is…
How many hours of your life have you lost to scrolling through web pages trying to find the perfect thing? Then it arrives at your door and it doesn’t fit, or the quality has you feeling like…
And what if you’re a last-minute shopper, like 30% of Americans (and me!)? Forget about shopping online. You need something fast, and you need it now.
So you go to the mall. You battle the crowds. And you come home with… something generic. Thousands of other people own what you now own. And who knows where the item was made or its impact on the environment.
There is a ‘joke’ in China that you can tell the ‘it’ color of the season by looking at the color of the rivers. This makes me sad.
But change is coming.
Common wisdom is about to be debunked.
The mall might suck, but that doesn’t mean that brick-and-mortar is dead.
Five reasons why physical retail is here to stay (a.k.a the four C’s)
Online shopping is overwhelming. Do you know how many results I got when I searched for “denim jacket for women” on Amazon? 40,000! Physical stores reduce the ‘tyranny of choice’. They curate the best which makes it easier to discover items you’ll love. It’s also part of the reason why 50% of millennials not only go to physical stores they prefer them as a primary means of shopping.
Websites can’t give you goosebumps. That’s why digitally native brands like Everlane, Warby Parker, Bonobos, and Rent the Runway are spending investor capital on traditional brick-and-mortar. Physical experiences increase emotions and connection which leads to greater spending and customer loyalty.
Online shopping is convenient, but waiting for something to be shipped is not. Buy Online Pick Up in Store (BORIS) has risen 44% since 2015 and 62% of shoppers are more likely to buy online if they can return items to a physical store. Meanwhile, brick-and-mortar is still the most convenient option for last-minute shoppers.
Buying online is a transaction. Buying from a store (particularly a small retailer) is something more. Shopping locally generates 3.5X more wealth for your community and independent makers are ~60% more likely to reuse materials. If you care about your impact, you buy local, and that often means a physical store.
Brick-and-mortar isn’t dead. But old-school brick-and-mortar soon will be.
To stay alive, stores need to focus on convenience, whether it’s curb-side pickup, on-demand delivery, or easy returns.
But to win, they need something else: a connection with consumers beyond a transaction. They need to create a curated, elevated experience and sense of community that keeps shoppers coming back.
This will be tough for big-box retailers and mall stores. They’ve made their money with a one-size-fits all approach: mass-produced, generic items that are never going to feel personal, and a distributed network of chain-stores that erase any sense of belonging. That’s why they’ll continue to die.
It will be easier for small stores. The independently owned clothing, gift, homewares, and furniture retailers that litter our cities.
Independent stores are poised to make a comeback.
Small retailers have always focused on unique items and a personal feel: something that is hard to replicate online. Shopping with them also has a direct impact on your local community. The question is, will they be able to use technology to layer in convenience? It remains to be seen.
Brick-and-mortar isn’t dead, but it is changing and we’re about to witness the next wave.
A new set of stores are coming. Stores that will marry the best of online: convenience, with the best of offline: curation, community and connection.
Now that’s a future I’m excited for.
I’m Christine Outram, Co-founder of CURIO.
I write about technology and how it shapes our physical world. Together with Lena Khouri, we’re on a mission to put millions of dollars back into local economies with an app that makes it easy to shop from small retailers nearby.