Today’s show is the first in a mini-series on the changing landscape of retail.
We’ve been hearing about the death of retail for more than five years now. There is no question that retail is changing. Perhaps the biggest effect is the blurry line between online and offline.
It used to be the case that customers would drive to their favourite shop and see what they had in stock. Customers would browse the aisles and make their buying decision based on what was in the store.
That was rarely a perfect shopping experience and most customers would walk out empty handed. Shopping malls reduced the frustration factor because there would be another potential supplier a few doors down in the same mall.
But the mega shopping mall with 400 stores can take 20 minutes to get in and out of by the time you park the car, walk to the mall entrance, find the store you’re looking for and walk the entire length of the mall only to find out that they don’t carry what you’re looking for.
Prior to the pandemic, online accounted for about 8% of retail sales, a continuation of steady increases in the percentage of retail sales taking place online. Along came the pandemic and online sales virtually doubled to more than 16% of all retail.
Then as the world emerged from the pandemic, online sales fell to about 14% of all retail before rebounding to about 16% in 2024.
But not all in-store sales are truly in-store sales. An unknown percentage are "Clicks to Bricks" sales where the browsing happens online and the transaction happens at the cash register. This is still about the immediacy of the purchase which the ecommerce world has improved, but not solved.
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