One might conclude that physical retail in America is on its way to the dinosaur graveyard based on the frequent stories in the popular press. Toys “R” Us has filed for bankruptcy. Many of the big department stores are struggling. Online giant Amazon bought Whole Foods.
Credit reporter Pat Ferrier for a good story in last Sunday’s Fort Collins Coloradoan that put a local face on the changing landscape of retail (“Three local centers adapt to changes in different ways”, September 24). It’s not that physical retail is dying – that’s hardly the case with “only” 7.8 percent of sales being made online. But, it has changed and continues to change.
And that’s not really new. In bygone times big urban department stores disrupted small main street merchants, then suburban malls spelled the demise for urban department stores and downtowns and now e-commerce is disrupting malls. It’s important to note that none of these upheavals killed off small merchants or downtowns (well, at least most of them). Over time, they adapted.
That was the case in Fort Collins. The Foothills Fashion Mall of the 1970s hurt retail in Downtown. Now, Downtown Fort Collins is one of the healthiest downtowns around. Different, not dead.
Now malls are being disrupted. Regional malls just aren’t being built these days as the over-built retail landscape of the pre-Great Recession world resizes. As Ferrier’s story points out, they are shifting focus. Retail is still a key element of malls like Foothills, but it has shifted its mix to more entertainment and restaurants with a big residential footprint.
Another trend is physical locations as branding, relationship building and fulfillment centers for retailers. Look at the new Otter Shop in downtown Fort Collins. Yes, it does have some cool merchandise and they’ll certainly sell some through the store. But it’s about projecting their cool brand and building customer and community relationships. An even better example might be Apple stores.
So, physical retail will always be around, but as history has shown, it will adapt to changing consumer tastes and technology. Different but certainly not dead.