The Fall of the Mall: How Online Shopping is Reshaping the Retail Landscape
It’s no secret that our collective shopping habits have changed so much over the last few decades—and years—that the formerly great American shopping mall empire is feeling the pinch. However, the most recent wave of closures is drastic enough to prompt Business Insider to call it the “retail apocalypse.” More than 3,500 stores will close over the next few months, and many of these closures represent anchor stores that previously defined the mainstays of the mall, like Macy’s, Kmart, Sears, and JCPenney.
“There are consequences to large box store closures,” says senior director of Fitch’s commercial mortgage-backed securities group Chris Bushart to the Financial Times. “Occupancy rates rise at malls and when they lose their anchor tenant, then some of the smaller stores re-evaluate whether they want to be in the space as well.”
Whether you grew up as a frequent shopper of department stores or not, you must admit that the closing of up to 150 Sears locations soon signals the end of an era in our shopping history. From the catalogue business of the early 1920s to the bustling appliance, tool, furniture and clothing store of the ‘80s and ‘90s, Sears has anchored malls around the country and defined how Americans have chosen to shop.
Consumers are increasingly turning toward the convenience and selection of online shopping. Are you more likely to hop in your car and run around the mall trying to find every item on your wish list or simply pull out your phone and have items sent to your door with a few clicks? According to a recent survey from Pew, eight in 10 Americans are now online shoppers. 79 percent have made an online purchase, 51 percent have purchased something using just their cell phone, and 15 percent have followed a link from a social media site to complete their purchase.
As an ecommerce entrepreneur, this is good news for your business! Even if you’re the proud owner of a physical retailer, it’s not time to panic yet. The rise of online shopping provides an opportunity to use omni-channel retail to offer shoppers a cohesive shopping experience both online and offline. By taking advantage of the rise of e-commerce and online marketing tools, enterprising store owners can bolster in-person shopping experience and their online sales at the same time.
Operating your business as an e-commerce store gives your company flexibility to operate without the overhead of a physical space. It takes money to keep the lights on and keep merchandise stocked, even if foot traffic is sparse. In an online space, you can scale your business so your costs keep pace with your revenue. Here are just a few of the flexible options that online entrepreneurs are capitalizing on thanks to the ubiquity of the Internet:
–Social Media. Social media strategy looks vastly different depending on the company and target audience. It’s now possible to reach new customers with Facebook Live streaming or use Snapchat for location-based marketing.
–Platform. E-commerce store owners can choose the look, feel, and deployment capabilities of their online shops. For example, a Shopify Plus and Magento Enterprise comparison reveals that not every platform is created equal when it comes to customizability.
–Drop-shipping. Who says you have to have every single one of your products in stock before someone can buy it online? Drop-shipping means you can bypass renting out expensive warehouse space while still fulfilling customer orders.
Moving forward, we’ll likely see some retailers lean toward building an omni-channel presence to make use of a physical space and an online shop. However, many future-focused entrepreneurs are intent on building their e-commerce stores to their exacting specifications and using modern marketing techniques to attract new traffic and new loyal customers to their platform.