Nice post! But I don't know if you you've fully captured the full extent of how retail is being disrupted. I've seen statistics saying that, in fact, more than 300 retailers have filed for bankruptcy this year. This could ultimately decimate shopping malls (which are also in a bad state), since smaller stores can reduce or get out of their leases when an anchor store closes. Retailers are also being squeezed by brands, such as Canada Goose, growing their direct-to-consumer sales channels, thereby becoming less reliant on retail partners. And there's also the emerging business of stuff—like clothes—as a service, which further undermines the need for retail stores. I don't study this as closely as you, but my read of the situation is that:
- America is over-stored
- Retailers are deeply in debt
- Online shopping is still in its infancy (about 12% of all retail sales in the US)
- Retailers must either compete with Amazon (hard to do, especially since they're so deep in debt) or offer something novel
- Experiences may help, but they won't help all stores—I'd say a minority of retailers will survive
My two cents.
Thanks for the kind words!
You’re right, I didn’t touch on all the shifts that are happening in retail, specifically around the malls, online commerce, and the concept of death in the middle - where today as a brick-n-mortar retailer you’re options are really only providing a one-of-kind experience (such as Apple) or sell merchandise at very low cost (such as Marshall’s).
Also, I think it’s more wholesalers that are feeling the impact of brands going consumer direct. However, the shift in cutting out the middleman is a shift that’s already been happening across several industries. Think Dell in their prime.
You brought up a very good point with Amazon. Amazon is basically a blackbox with merchants, meaning that they pass along very little information/demographics on who are buying your products. So when talking to clients, the conversation focuses on how can we work with partners that act as a middle layer to capture 1st party audience data (to begin to segment and use for targeting & retargeting) even if the sale and fulfillment is done by Amazon or other big box retailers.
Love the feedback and sorry this was a bit delayed.
No worries! Appreciate the reply. Amazing to me that, more than 20 years after the web's mainstream deployment, people still buy as much as they do offline at all.