We have been seeing the ascent of Amazon for years and have had the death watch on retail as we see more retailers closing stores and filing bankruptcy. Is it really pre-ordained? I will run through a few anecdotes that really seem to be the root of retails woes and what could possible lead to a rebirth of retail.
I have slightly larger than average feet. Depending on the brand, I wear between sizes Men‘s 13-14 US. When I buy shoes, I prefer to go to retail in order to try on the shoes and make sure that there is not a lot of back and forth; I want the transaction to happen and be completed with the least friction as possible. And the funny thing is, this is why I turn to sites like Amazon, to eliminate the friction in shopping. It just so happens that I think shoes are largely better suited for retail, but I am sure plenty of folks prefer online retailers.
For me, buying shoes is going to the mall. If I look at my local mall, 14 of the 66 stores are specifically “shoe stores,” with at least double that having a significant selection of shoes.
Only one store routinely carries shoes in my size, Tradehome, and they carry only a few select brands of premium shoes. I have purchased a couple of pairs of dress shoes for myself from here. However, I tend to wear dress shoes with less frequency and need some every day shoes, which tend to be Adidas walking/running shoes. My choice would be to go to stores that have a large selection of Adidas, like Journeys, Finish Line, or Dick’s Sporting Goods. I am routinely told, “yeah, we don’t really have any shoes in stock in those sizes, but we can order them for you.”
That pretty much sums it up. I rarely enjoy throwing myself into such an experience but I decide to drive to the mall, park, and go the through the ever dwindling crowds (with the exception of the holiday season) only to be told that they can be ordered? No, thank you… I can do that for myself from home.
I enjoy books stores and always have. I like being able to just browse around, flip through a few pages, and maybe even get a coffee and something to eat in the in-house cafe. I frequented Borders and Barnes & Noble for years. A couple of years ago, I was browsing through the diminishing tech section and came across a certification book that I actually was interested in buying. The problem was, they were selling it at the list price on the cover, which was $100 USD. Their own website had the book for $60 USD. I decided to ask if they would price match their own website, even though Amazon carried the book for $55 USD.
Unfortunately for the retailer, the employee said that they could not because they had physical space to cover. With a little though, a retailer like this might realize that it would be better to sell this book at a lower margin and still make the sale, moving a piece of their inventory that had likely been on the shelf for for two years and remains on this shelf to this day (seriously, that exact copy was there two weeks ago, I could tell because of the specific corner of the book had been bent in a certain way from being shelved). I decided that I would just buy it on Amazon while I stood in the store with free two-hour shipping.
Where I live, we had a new shopping centered that opened up last year that was one major road down from us. It was great, a fantastic grocery experience with a Starbucks cafe, sushi and pizza made-to-order, and real BBQ (read: smoked with actual wood, on-site). Just two doors down, we had a chocolate shop open up, which I had just been thinking to myself a month before it was announced that it would be nice to have one nearby. Unfortunately, like so many other chocolate shops (like Fannie May), they don’t make their chocolates on-site.
What is the draw for me to come to a chocolate shop that just has some chocolates for sale when I can just pick up some at the grocery store while I am already there? There is no novelty. If you want me as a customer, you need a unique experience with good customer service.
What To Do
I believe that the saving grace for retailers is simply identifying unique and novel experiences for customers in order to attract them into stores. Retailers like Barnes & Noble have already started this with their Maker Faires, but it isn’t enough because the effect cannot last much past these short-lived events. They have to go further by making the every day experiences in the stores easier to deal with.
Shopping centers and malls need to have routine events to attract customers to the area. Malls like The Mall of America probably sustain better sales than traditional malls because the mall itself is a destination. Some malls have resorted to having indoor go-kart racing and concerts. All of this and more is going to be necessary.
I don’t need to come and get polo shirts at a store, but if I could get custom fit polo shirts at the store, I might try it. I read back in college a story about regular stores in China that leave pants unhemmed so that they only have to keep the waste sizes and fit in stock, and then the length can be selected right then and there and it is hemmed in store within 3-5 minutes. These are the experiences that we need if we are going to keep retail viable. I don’t think that retail will be able to survive at the level that we have expected, even with these measures, but as The Architect says in The Matrix Reloaded, “there are levels of survival we are prepared to accept.”