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Retail Armageddon, Chupacabra, and Other Myths
A simple Google search for the phrase “retail Armageddon” produces 413,000 results.
Many of those references are very recent. Here are just a few of the search findings from this year:
May 5th, Retail Armageddon: More bankruptcies in four months than all of 2016
June 3rd, It’s a retail Armageddon as over 1,000 stores close in one single week
October 20th, Stores Struggle to Find Workers Amid Retail ‘Armageddon’
Chupacabra
The “sky is falling,” doomsday predictions for retail have a lot in common with myths like the chupacabra – a folkloric beast whose Spanish name literally translates to goat sucker. These mythical creatures were purported to attack and drink the blood of livestock. Like any good myth, there is some truth to the legend. In the case of the chupacabra, people likely observed feral dogs infected with rabies and conjured up images of creatures of various sizes and shapes. In the case of the “retail Armageddon,” passive observers and some industry analysts confused the closure of “traditional retail businesses” or reduced traffic at locations like malls with the annihilation of all retail.
Just the facts
Fortunately, the best antidote to a bad case of retail Armageddon mythology is a sizable dose of facts. For example, one need look no further than early numbers from the 2017 Christmas shopping season. Irrespective of all the store closings that took place in 2017, US retailers had the highest sales since 2011. Year-over-year numbers are up 4.9%.
Yes, Virginia, there is retail in America, and it is not on the verge of collapse.
Retail (like everything else in life) has simply changed with the times. In fact, this year’s impressive sales numbers were generated, not through the retail channels of my youth – malls and catalogs – but through technology platforms of today – tablets, smartphones, and orders placed by digital assistants. In fact, online retail increased 18.1% this year .
Amazon continues to be a big winner. In their post-Christmas press release Amazon reports impressive sales volumes:
More than one billion items were ordered from small businesses and entrepreneurs worldwide this season – and over just five days, from Thanksgiving through Cyber Monday, nearly 140 million items were ordered from small businesses and entrepreneurs. Amazon Devices also had its best holiday yet, with tens of millions of Alexa-enabled devices sold worldwide. Echo Dot and Fire TV Stick with Alexa Voice Remote were not only the top-selling Amazon devices this holiday season, but they were also the best-selling products from any manufacturer in any category across all of Amazon.
Beyond the pure sales numbers, Amazon highlights the growing trend to mobile ordering and even the use of Augmented Reality technology in the shopping process:
The top five items ordered on a mobile device were the Echo Dot, Fire TV Stick with Alexa Voice Remote and the TP-Link Smart Plug.
Customers worldwide shopping on the Amazon App increased nearly 70% this holiday season.
More than 1,400 electronics products were ordered per second on a mobile device this holiday season.
AR view saw the most usage on Cyber Monday. The most popular item viewed with AR view throughout this holiday season was a black chair with ottoman. Top categories viewed with AR view are furniture, toys, Amazon devices, kitchen items and consumer electronics.
Lest you conclude that brick-and-mortar stores are dead, realize that the week between Christmas and New Year’s Day alone is estimated to produce 69 billion dollars in retail revenue, about 11% of the season’s total. Most of those purchases will occur in traditional stores as customers initiate returns.
The Art of Retail
The art of retail is having the right product for the right customer – where, when, and how that customer wants it. There will always be retail stores and technologies to make the shopping experience more pleasurable. The core principles of customer experience excellence remain in retail and all sectors:
These are NOT the end times for retail…they are simply times to adapt to changing needs for consumers. Afterall one moment we might be selling and the next we ARE buying!