It doesn’t take much to find so many articles, many of which regurgitate the same information, that are quick to shout the news of all the stores that are closing, retailers going out of business and retailers that are on the verge of bankruptcy. Of course, these writers praise the internet, namely Amazon as the cause for which all the tech people jump for joy. However, whereas some of what has been written is true, retail is far from being a thing of the past.
 
A RECURRING CYCLE
The truth is we are in a cycle, one that happens every twenty years or so as concepts, ideas, technologies along with consumers’ interests and desires change. Retail, once nothing more than the local general store, grew into what became the full-service department store in the late 1800s. Macy’s was founded in 1858 but started out as a dry goods store.
 
Then in the 1940s, the full-service department store became known as the “anchor” store as shopping malls were being built. By the 1960s shopping malls were everywhere but by the 1980s, malls were considered doomed if they weren’t enclosed and had a food court.  So, during the 1980s the new malls had all the bells and whistles, including movie theatres and entertainment areas, while the old malls were being reinvented with enclosures and add-ons.  But by the early 2000s it was time for another change. The Strip Mall, which was created to appeal to the customer in a hurry with in and out convenience, allowed customers to drive to the store of choice, run in, get what they wanted, and leave.
 
The strip mall also had a second phase which we now know as The Outlet Mall. In the beginning, the Outlet store sold left over merchandise from their parent store. But as time progressed and the concept became so strong, soon retailers realized the opportunity they had by stocking their outlet stores with knock offs of the higher quality merchandise now sold for a lot less. This new retail opportunity for the discount-minded consumer was and still is a huge success, but also a major threat to full price stores. Yet, retail has managed to survive with customers becoming educated and learning that the quality in the outlet is not the same as the full-price store. There are still many great deals and bargains but it depends on what the customer wants.
 
THE TRUTH ABOUT TODAY
So where are we today? Are there too many stores? Yes. Are many of them going to close? Yes.  Are some retailers going to be forced to go out of business? Yes. But what we’re not hearing about is what’s next and I can assure you, it won’t just be the internet.
 
Each week, there’s another e-commerce business getting into brick and mortar. In many ways, these new stores will be the retailer of the future because they will open stores unlike old retail, but rather new and fresh with the latest technology, conveniences and very “cool” merchandise. And we’re not just talking about Amazon. Warby Parker for eyeglasses, Bonobos for menswear, Blue Nile for jewelry are just a few of the once e-commerce only businesses all opening stores. And many of them are already offering some very different brick and mortar selling concepts. For example, if you go into a Bonobos to try on the clothes, while you’re being fitted, the company is putting together what you need online and having it delivered to your home.  This type of in-store opportunity will become as common to us in the future as bringing a newspaper coupon into the store was in the past.
 
These new brick and mortar stores will be more like Apple and a lot less like Macy’s of today.  They will be exciting, alluring, and appealing to a new generation of shoppers. The old tired retail stores will eventually go away. Some retailers will be able to convert and survive and others, because of format and product, will not—but that’s retail. 
 
SOMETHING TO REMEMBER
We have long forgotten about store names like Gimbels and Hudson’s, Caldor and Ames. Each of those chains had their time, but were later pushed aside as other retailers came into the market with newer concepts and appeal. We take it for granted today but when Kohl’s was taken over by private investors in 1979 and went public in 1992, it grew into being the second largest department store we have today. In the early 1980s it was still a new concept and many were not sure it would work.
 
What will retail look like in the future? We all have ideas of what it will be like, but none of us have a crystal ball. Usually, when we predict the future, it’s only partly accurate. But I do know that retail will never be a thing of the past provided there are humans on the planet.
 
Some of the newer inventions and concepts may start off strong and then fizzle out and some of the “this will never work” ideas may be a huge long-lasting success. Again, that’s retail.  That’s what makes it fun, exciting and something so many of us love being part of.  So, simply said, retail is far from being a thing of the past!

Recently, I attended a large family reunion with guests from ages 3 to 90.  After dinner, a group of us got into a discussion about shopping today; stores, online and how technology was impacting their shopping experiences.  What I found interesting about the conversation were the many opinions and ideas about what retailers should and should not do. But what was fascinating to me was that there were as many people over 50 who will do anything they can to avoid going to a store and equally or more guests ages 18 to 30 who hardly do any buying online and prefer shopping in stores.  The conversation also addressed how today’s technology has made shopping better for some and for the others, how it’s made it worse.
 
The first topic we discussed dealt with how when a retailer puts in technology, sometimes it puts more onus on the customer and for some of the people in the discussion that was an inconvenience.  We began talking about how ordering a sandwich in a convenience store was no longer convenient.  In many C-stores today, even though the sandwich employee is standing right behind the counter, the customer must take it upon themselves to go to a kiosk and order what they want as if any dialogue between the employee and customer was not allowed.  Two of the guests loved it because they were confident they would get the sandwich exactly how they wanted it.  However, three of the guests found it to be impersonal and an inconvenience much rather preferring to speak with a human being.  So, what’s the point?
 
TWO TOTALLY DIFFERENT SHOPPING STYLES
Simply, today we have evolved into two very distinct shopping groups: the personal and the impersonal.  And by impersonal, I don’t mean cold or indifferent, but rather just a group of people who don’t want the fluff and prefer speed over conversation as well as preferring to do it themselves rather than having someone do it for them.  There’s nothing wrong with that. However, what retailers must understand is that these two groups are very different with their wants and needs.  To be successful, retailers must equally address both and not abandon one over the other. 
 
A LOOK AT THE STATISTICS
Even when looking at the most recent statistics, there are still many shoppers who prefer shopping in-store and they cannot be forgotten.  According to a recent report posted by Jeff Edberg on his IC Blog (http://bit.ly/2nMtEfR), today current e-commerce sales are approximately 294 billion annually, while U. S. brick & mortar are just under 4 trillion, a huge difference.  Yes, online sales are growing at a rapid rate and will continue to do so, but his report shows the difference between the two shopping styles and what they’re looking for. For example, 55% of online shoppers prefer to buy from a merchant with a physical store presence over an online-only retailer, thereby giving brick & mortar retailers the advantage.  But what most customers want, is a strong omnichannel experience allowing them to decide where to shop: online or in-store, and how.  Eventually, when the balance of technology is properly blended with all the brick & mortar advantages, the dedicated in-store shopper may begin to enjoy some of the online shopping conveniences just as the staunch online only shopper may acquiesce from time to time realizing that when buying certain products, the in-store experience is much better. 
 
Looking at the convenience store example, providing kiosks is great for those who prefer it.  However, wouldn’t it be better to have kiosks for those that want them while also having one employee behind the counter taking orders for those that don’t?  The human taking orders is more inclined to provide a better customer experience, if the person is pleasant and engages the customer.  The store employee will also provide more business for the convenience store because as a human being he or she should be able to make good add-on suggestions about what extra items to put on the sandwich or to have with it, whereas the kiosk in all its technological efforts can provide choices but not with a friendly smile. 
 
WHERE RETAILERS ARE CALLING THE PLAY WRONG
Now think about the retail store.  When focusing on the in-store experience, so much effort today has much attention on the need to expand technology with Wi-Fi and mobile apps that allow customers to find everything they want simply by looking on their phone. The problem is that there are as many shoppers who may like it and embrace it as a great convenience, while as many if not more, who don’t. 
 
My concern is that too many retailers in a panic are tilting too far to the technology side and by doing so will alienate the customer who prefers the more traditional in-store shopping. Too many retailers are not investing in effective training for store personnel and whenever something needs to be cut, it’s store employees.
 
HOW THE RETAILER CAN USE THE ADVANTAGE
Providing the in-store experience for both shopping styles guarantees the retailer will win.  The retailer has the advantage through brick and mortar to offer the customer a great shopping experience with the opportunity to see, feel, touch and experience the product(s). Online, the same retailer can provide shopping/browsing conveniences on an easy to use website in order to deliver the customer a positive online shopping experience. 
 
Retailers, be smart. Think about balance. How do you continue to keep the traditional in-store shopper happy while at the same time embrace the shopper who wants a quick in and out shopping experience through technological conveniences?  If you feel you need to invest in Wi-Fi and an app that does everything in place of the store associate, fine. But beware of the customers who will not respond positively and will walk out if they can’t find a well-trained associate to help them when needed.  Think about what in-store conveniences you can add for the “I’ll come to you only when I have to” customer, like a quick and easy area for in-store pickup and online returns.  Think about what merchandise may make sense to set up in self-serve areas.  But for every convenience you add for the “I’d rather do it myself” shopper, be sure not to take one away from the traditional shopper.  Simply employ a good balance of both and always offer both shopping opportunities.
 
THE RETAIL OPPORTUNITIES ARE THERE
For those who think it’s all technology and only technology that can save the in-store experience, keep in mind that the e-commerce world will keep changing as well; one reason why many e-commerce sites are opening stores is because they already realize the touch and feel benefits of brick & mortar.  In addition, expect to see more virtual stores online simulating the in-store experience.  But remember, as good as that may be, it won’t replace the real thing.  For the shopper who prefers technology and the do-it-myself mindset, he or she will be elated while the traditional shopper will not.
 
For retailers to truly win, be sure to keep a balance of both shopper styles.  Technology is great and provides many benefits and conveniences, but remember the traditional shopper as well and you’ll have the best of both and no doubt, great success!

Art Suriano
CEO, The TSi Company