Chasing the Customer … Is BAM (Brick and Mortar) About to go Bust?

UPDATE: My good friend Jack Hall, who knows a lot about retail, just sent this link in. From Abercrombie to Walmart, brick and mortar retailing is in for a tough year. http://money.msn.com/top-stocks/post–wal-mart-the-latest-sign-retail-is-reeling

 

No … but things are changing and good merchants will have to adjust their thinking and market strategy. Here’s why:

Some of you might have read my earlier blog on LinkedIn hypothesizing that 30 to 50% of brick and mortar retail space might close in the next ten years or less.  https://rl098.wordpress.com/2014/01/24/chasing-the-customer-but-to-where/

Starbuck’s CEO, Howard Schultz on last month’s first-quarter earnings call claimed that brick & mortar retailing was at an inflection point. ShopperTrak data showed that holiday traffic in 2013 was about half of the 2010 traffic. Overall shoppers visited an average of three stores per mall trip in 2013 versus five in 2007.
Merchants are adopting a ‘mobile first’ strategy according to my old friend (all my friends are old these days) George Anderson. He is reporting on a  2014 Shop.org/Forrester Research State of Retailing Online report. 
Today, the rather smart folks at Prosper Insights & Analytics, Gary Drenik CEO, wrote about the Year of Retail Reckoning,  linked below,  for Forbes. Interesting reading from some folks that always seem to have the best handle on data.  http://www.forbes.com/sites/prospernow/2014/02/03/year-of-reckoning-for-brick-and-mortar-retailers/
My friends at retail tell me that they are taking a very hard look at cutting traditional advertising budgets and moving to online. That’s potentially a major impact on TV and newspapers. And the fact that holiday sales were up a tepid 2.7% at a great cost to margin, indicates that every marketing dollar will be closely reviewed and monitored.
Merchants will have to know digital media and data analytics!
R/L
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