There is still a huge need for physical stores - a place to actually see products before buying them, a convenient place to pick up things you have ordered, a place to go to ask for sales/tech advice, etc. We see Amazon starting to move in this direction with their pickup lockers and physical stores (not to mention the pruchase of Whole Foods).

In the end, though, this is more like the taxi industry or video rental... The incumbents had the advantage in that they were potentially able to pivot and shift. They have failed - so has Sears. Its a tough thing to do, but its possible. I don't like to see the loss of competitors, but companies have got to innovate and adapt, The world changes too much now.