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Retail sales in 2016 were dominated by online purchases and the predictions for 2017 shows the trend will continue. As an example during the 2016 holiday season, Amazon captured close to 37% of online sales. Larger retailers have reacted and have begun more investment in their online spaces. The companies that don’t often don’t succeed. Large retailers such as Sears, Kmart and Macy’s are closing many doors as they become less profitable. During the next 18 months, more than half of Abercrombie and Fitch’s 745 retail locations will close and American Eagle has 185 properties being considered for closure. Customers today seek immediate results and being able to have an item shipped with two-day delivery is more appealing than dealing with crowds, traffic and long lines.

This is an evolution

Customers are not skipping the local store in favor of online retailers because it’s trendy, the economy is making a shift towards online transactions and this has been gradual over the years. The same type of shift happened when consumers opted to stop going to the corner market and instead shop the local department store. The larger retailer had a greater selection and better hours. Sadly the small corner store began to fade and department stores popped up bringing more shopping options.

Today this shift is evolving; customers are seeking more options and more accessibility. When was the last time you picked up a catalog, made a phone call, placed an order and you were okay waiting for your item to arrive in a week’s time? Now a customer can research a product from their couch using their digital device and make a purchase any time of the day.

The overhead associated with a traditional store are pushing retailers to consider running an online store. Leasing commercial space is expensive. Utilities and the employees needed to meet customer needs become a factor as well as.

The good news

Online retail locations level the playing field. The corner shop and the big-box retailer can compete for the same customer using their website and mobile apps. Their customers can shop 24/7/365, overhead is low with no massive retail space and fewer employees and the marketing saying of “location, location, location,” is removed from the equation.

Jordan Creative

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