Having retail stores, I have been studying the retail apocalypse for the last year now. The retail apocalypse is the historic drop in brick and mortar retail stores occurring over the last two years even though retail spending continues to track very high. Retail apocalypse was termed back in 2017ish when large retail stores started closing at alarming rates. Some of this is due to a change in consumer spending with consumers going online. But, it seems to be more than that as brick and mortar stores have not been able to convert lost customers over to their online platforms. If a customer goes online to buy products, they can choose best pricing, shipping, delivery times, etc. Many online only retailers have much lower overhead and offer compounded deals that might not be as apparent when selling at brick and mortar.
I have personally seen this when the proud customer walks in and tells me, “I usually buy online but I really needed XYZ so I had to come in here.” My reply to that person is always, we have a website too that you can order if you prefer to shop online. Hopefully, my tone did not match the typical customer tone of “gracing us with their presence.” Really, I appreciate the fact that the customer came into the store. However, the point being that the entire mindset has shifted. Coming into a store is a hassle. Packages arriving at your door are like little gifts that you get to open. Maybe in some perverted sense it is Americans reaching for delayed gratification if only by a day or two. (Hmm, think about that for a moment.) We have even employed using an alternate website just so we could say that this company was “online only.” We took it down after a year or so because it no longer made sense for us to use it, but it was a thought in our business continuity plan.
Recent history has shown us that entire industries are not immune to these types of events. From the dot com bust of the 2000 era and the economic crisis of 2007 that took down financial giants, each has their story of doom and comeback, maybe not in the same form as the prior. But, each did come back. Maybe the players looked a bit different, maybe the market was much smaller, but they did return. So is this a TKO or how will retail return?
Here is what I have seen and foresee. Retailers will close at an alarming rate. Companies that support those establishments will be “surprised” by this, companies such as real estate, banks and lenders and property management companies. And, retail will return at some point with more customized type offerings. It will return as shoppers try to distance themselves from the everyday online offerings to the individualized boutiques with a bit of glamour. Experience type establishments will continue to flourish as our homes continue to be overcrowded with stuff, and we look to events to bring us joy.
As we look into the future and see the number of disasters on the horizon, we also need to see how this will begin to reshape the new. It will not look like the old, people will learn from those mistakes. And, when it starts again, it will be different.