The relationship between brick-and-mortar stores and online retailers is becoming ever-more blurred. The latest and perhaps best example is Amazon.com’s recent purchase of Whole Foods. On the other end of the spectrum, Walmart purchased Jet.com to strengthen its e-commerce business.
As department stores and other large retailers close across the country, often leaving shopping malls struggling to fill the vacant space, many analysts are prophesying the demise of brick-and-mortar businesses.
Yet, there are numerous signs that brick-and-mortar retailers haven’t breathed their last breaths. With 2017 almost over, it’s not too early to examine retail trends we’re likely to encounter in the coming year. And though there’s no doubt brick-and-mortar retailers must be nimble and innovative to survive the changing retail landscape, the following three retail trends show that people still enjoy shopping in physical stores.
Millennials, who came of age during the Great Recession, are more cautious about spending money than their parents’ generation. That’s problematic for retailers, but if they adapt, they can still attract the coveted millennial demographic. Millennials prefer experiences to things, so retailers have an opportunity to attract millennial customers by offering them unique experiences.
Restaurants, for example, have weathered millennials’ preferences better than department stores and other retailers. As restaurants and other experience-based stores fill up vacant space in shopping malls and attract more millennials, neighboring retailers will also benefit. Whether it will be enough to solve all of the woes shopping malls face remains to be seen, however.
Embracing the Treasure Hunt
One clothing retailer that is opening stores instead of closing them is TJX Companies. Inc., the parent company of discount retailers Marshalls, T.J. Maxx, and HomeGoods. The company anticipates adding 800 stores in North America alone.
Analysts credit the “treasure hunt” atmosphere at the stores for their success — the ever-changing inventory encourages shoppers to visit often to see what new bargains will be available. That kind of shopping experience is difficult to replicate online.
Given TJX’s success, expect to see more retailers attempting to copy its winning formula. In fact, it’s already happening. Department stores, including Macy’s, Nordstrom and Kohl’s, are experimenting with off-price stores meant to speak directly to TJX’s customer base.
Innovating Better In-Store Experiences with Technology
One factor that deters people from patronizing brick-and-business retailers is all the little annoyances that add up, such as long lines, no help available when you need it or limited product availability.
Technology — specifically online commerce — is posing problems for brick-and-mortar retailers, but technology can also be the solution. For example, Walmart is experimenting with a smartphone app that would allow people to buy items in a store, pay with their phone, and walk out — all without having to wait in a line. As the technology becomes more accessible, other retailers will undoubtedly follow in Walmart’s footsteps. In fact, Amazon is testing a similar concept with a convenience store in Seattle.
Expect to see the implementation of lots of other innovative technologies in retail locations throughout 2018, whether it’s automation, greater synergy between brick-and-mortar locations and their e-commerce websites, or something yet to be seen.
About Morgan Li: Morgan Li is a new breed of manufacturing, offering custom store fixture, hospitality and retail environment solutions with a nimble, efficient and innovative approach to keep up with the evolving and rapid landscape of its customers industries. Morgan Li’s capabilities include fabrication of custom metal, wood, acrylic and led materials for retail and hospitality environments. Morgan Li provides services and capabilities to leaders within the retail and hospitality industries. The company is beginning expanded growth efforts within the grocery, CPG and healthcare and professional space. In the retail space, Morgan Li provides fixture, display and storage solutions from showrooms to tradeshow floors with custom or refurbished pieces. Since its founding in 2009, Morgan Li has seen 33% year-over-year in growth.