Online shopping is eating retail
Online shopping is eating retail
The decline of brick-and-mortar retail in America has been well documented: U.S. merchants are closing thousands of stores each year, and the long list of retailers that went bankrupt in 2019 includes everyone from luxury candy makers to flower delivery companies.
Though the apparent magnitude of the sector’s decline might be shocking, its cause is abundantly clear. Online shopping is eating retail. This is evidenced by the stark increase in what the average U.S. household spends online in a year — $5,200 in 2018. That’s an almost 50% uptick compared to 2013, according to UBS.
If you’re the owner of one or more of these stores, what are you to do?
Survivor Mode
You likely know the old saying “If you can’t beat them – join them.” It certainly applies here. That’s not to say you should take your operation completely online; you’ll still have competition there. Chin up. As the owner of a physical store, you actually have a few things going for you.
For one, even though Millennials, currently the largest U.S. consumer group, make most of their purchases online, they do still buy in-store 40% of the time, which is no small number.
And secondly, when shopping for items like apparel or furniture, there are obvious advantages to first seeing merchandise in person. Thirdly, your retail space also gives you opportunities to hold events and promotions that wouldn’t be possible if your only storefront was digital.
Furthermore, 71% of customers who shopped in-store spent $50 or more compared to only 54% of customers who spent more than $50 when they shopped online, according to a First Insight study.
Here are three ways to start:
1. Don’t fear digital channels — embrace them.
2. Create an interactive experience.
3. Personalize in-store experiences with data.
