Over the past decade there has been a great deal of positive declarations about the benefits of on-line retail. Money Morning even compiled a lengthy article detailing how on-line sales were not only growing, but also benefiting the economy as a whole.
Many businesses have found it as a way to expand their existing services in order to reach new sales markets. It is also true that the advent of digital retail has opened up a low cost opportunity for small businesses that have interesting products, but lack the capital to found a brick and mortar enterprise.
However, I have just read an article by Larry Downes that was published by Forbes that suggests otherwise. The articles can be seen HERE.
Mr. Downes begins by trying to explain the complexities involved in the current downward spiral that is being experienced by Best Buy. He veers off slightly when he goes into detail about a personal encounter when he went shopping with a friend at the aforementioned mega store. However, his over all message is related most specifically to Internet sales.
The main point that he brought up is that larger retail stores have now placed such an emphasis on digital sales that they are neglecting to maintain their standards for in store live customers. This is not entirely surprising.
Stores used to conduct regular free events. They would employ live musicians and host elaborate holiday parties. Malls contained fountains, plants, and things to see. In the 1930’s people would go to Macy’s just to see the tree. In the 1980’s pop singer Tiffany became a household name by doing a tour of malls. And, then they stopped.
It would be easy to blame on line sales for the losses in retail outlets. You could simply say that people aren’t showing up, because they have other options. But, that isn’t true. The reason customers aren’t showing up in person is because the stores aren’t giving them a reason too anymore.
It began with cost cutting measures. Reducing over-head is such a simple way to make it look like you have an increase in profits without actually making any gains. Then they reduced salaries. This looked great in the budget, but employees who feel under appreciated are not overly eager to provide quality service. Then there is the ever-present threat of lay-offs, and the fact the retail stores only higher part-time employees so they don’t have to pay for benefits. Employees won’t be loyal to a company that isn’t loyal to them.
But, the main problem is the atmosphere. There is nothing left to make it an experience. Now people are just wandering into a warehouse full of merchandise where people are rude to them.
If retail wants to save its’ brick and mortar businesses they need to bring back the show. Add a little P.T. Barnum to the shopping experience. Get people to come because they want to see what you are going to do next, and they will spend their money while they are there.
The best way we could save the American retail business market as a whole is if we started teaching entertainment classes in business schools the way we teach business classes in the schools for the entertainment industry.
If they don’t give the customers a reason to be in the building, then the customers are going to stop showing up completely.
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