The retail brick and mortar market may not be collapsing for all retailers, however it is going through such significant change driven by the demands of consumers that it will be become unrecognizable from its current incarnation. This change is driven by consumer changes in shopping and purchasing made possible now by mobile technology and wireless network improvements along with the growth of millennials in the retail market. The interesting part of these changes is that the change seems to be focused on the major retailers and the retail mall marketplace. Major retailers are under duress as a result of their dominance of the market that has allowed them to become rigid in their practices and controlling in their relationship with consumers.
Consumer lifestyle change is driving a large portion of this change experience and it seems that the spark is provided by the millennial increase in the market and along with this increase of millennials in the market a contributing factor is their refusal to accept the commonly accepted retail practices. The challenge for the large retailers is the demands from consumers to develop a relationship with the retailer and this is the key challenge to the major retailers that have maintained a focus on reducing costs to increase their margin and compensate for reductions in sales. These changes have been a long time in the making and are now reaching a tipping point where the momentum and the changes are self supporting.
Small, or boutique, retailers have not been impacted by these changes to the same degree because the strength and focus of these retailers has always been a focus on the consumer relationship. This relationship provides the basis for the stability and the product mix in the boutique provides the reason for consumers to return. On the other hand, the major retailers are dealing in commodity products, or products that can be found generally available in the marketplace. These types of products allow consumers to shop for price and this practice changed the retailer’s focus to price rather than relationship. This has become a learned focus by consumers and now with the growth of online sales and retail this practice has turned on the large brick and mortar retailers.
The large brick and mortar retailers have created and encouraged the very focus that Internet retailers are using to destroy the large brick and mortar retailers. These large retailers now must change or die and this is a struggle for them. The retail brick and mortar marketplace is collapsing and retailers must adjust their strategy and their operations to meet the changing demands. There is definitely a place for the brick and mortar retail outlet and retailers must now determine how it can fit into their future strategy and practices.
And now for the audience participation portion of the show…
ECommerce will have wide ranging impacts on both the retail and manufacturing sectors. How can you focus these abilities to improve the consumer's experience? Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes. In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas. How can you support these continuously changing requirements?