Is the end near?
Month of October
To many, the retail apocalypse has been a staple of the landscape for the past year and a half and, in all honesty, everything seems to indicate that this situation is likely to drag on for a couple more years. Basically, because a lot of companies linked to physical retail are not going to be able to adapt to the rapid changes that are needed to continue operating, in terms of technology, shopping experience, or service customization. Hopefully, this landscape, as we like to call it, will evolve rapidly and the industry as a whole will come out much stronger, for both businesses and consumers.
The dark days for retail aren’t over. Forever 21’s Chapter 11 filing is the latest reminder that the economic climate for many sectors of retail is still brutal. So far this year there have been more than 7,000 store closures, more than any full-year total to date, and 16 major bankruptcies.
The familiar line from the American Express commercials, “Don’t leave home without it,” was meant to have consumers remember their credit cards. It is an especially useful reminder when purchasing online.
The retail apocalypse over the past several years has devastated America’s department stores, chains and mom-and-pops. Stores are closing at record levels. The number of people working in retail is on the decline. And all of that has happened at a time when the economy was strong. But if the United States slips into a recession, as many economists fear it will sometime next year, the problems plaguing retail could get far worse.
Reports emerged this week. Amazon is in talks to bring its cashierless Amazon Go technology to airports, movie theaters and baseball stadiums—a move that could help the e-commerce giant really hit the gas in terms of brick-and-mortar expansion, which has been slower than initially anticipated.
The National Retail Federation, the nation’s largest retail trade group, forecasts that holiday sales will rise between 3.8% and 4.2% even as uncertainty looms over an escalating trade war with China. The holiday sales forecast, announced Thursday, marks an increase from the disappointing 2.9% growth seen in the November and December 2018 period
The bankruptcy of fast-fashion retailer Forever 21 was the 35th major bankruptcy this year, with over two-thirds of them in retail. And it likely won’t be the last. Coresight Research says over 8,500 stores have closed this year, 47% more than last year and ahead of the record 8,000 or so that shut down in 2017.
When you think of retail technology a few well-known names come to mind: Amazon. Shopify. PayPal. Square. But what about Microsoft? Microsoft of course provides a lot of the back-end infrastructure that helps power many retail systems. But the company’s Dynamics 365 retail product offering has struggled to gain recognition. I think that’s likely to change.
Bringing new technology into retail can be costly, for both young brands testing physical retail for the first time and more established retailers. On September 26, McKinsey & Company opened a retail concept space in the Mall of America to help brands learn what technology could improve their in-store shopping experience.
Retail has often reinvented itself from mom-and-pop to big-box format. Today, however, retail has been evolving at a faster pace due to the rise of the internet and the use of technology. We’ve had online models battle offline models, offline models entering the online model’s space and vice versa — all in the quest for a unified, seamless omnichannel model of today.
Some of the most headline-grabbing retail technology is just the kind of stuff that retailers are hesitating to adopt, according to a new survey. Robots, drones, beacons and facial recognition have thus far been adopted by fewer than 10 percent of retailers, according to a Total Retail report.