Ok, so this is part three. The moment that you’ve been waiting for… In this post I’ll be extending my thinking about the changing retail environment and make some predictions:
Prediction #1 – If people can wait for the item and do not require expert assistance, they will purchase it for less money on-line. As such, the majority of physical retail spaces will no longer sell these items. Examples: Books, DVDs, CDs, Technology items, House wears, and Groceries (yes…groceries).
Prediction #2 – The Walgreen’s (convenience store) business model will continue to thrive. Walgreen’s has a little bit of everything. If you need it, they probably have it…speaking as a former employee. This business model will do well because of the convenience factor. No one plans to go to Walgreen’s for regular purchases…rather people go because it is convenient and they need something now.
Prediction #3 – Traditional grocery stores will face strong competition from on-line grocery stores. There are some interesting companies playing in this space…including Amazon, and a few others. Your local grocery stores may start offering on-line ordering and home delivery to retain current customers. (Why don’t they do this already? It’s the same situation that Blockbuster faced….they could have offered mail delivery of movies many years ago. They had the movies and the strong customer base…instead they didn’t accept the changing environment, watched Netflix/Redbox take over the market, and went Bankrupt.)
Prediction #4 – Certain products do not fair well on-line. A good example is most items sold at Home Depot/Menards. Home improvement stores will continue to do well. When working on a project I run to my home improvement store multiple times. I need a specialized item…and I need it quickly…often I also need help and the people there do a fairly good job of helping. Will home improvement stores offer on-line ordering and home delivery? Interesting.
Prediction #5 – Physical retail locations will continue to thrive. We live in the physical world and rely on brick and mortar retail to make purchases…and for entertainment. Have you ever gone shopping just for fun? We sometimes go to the mall or a bookstore, just to walk around as a cheap form of entertainment. The key will be for retailers to determine a winning strategy that complements the Internet rather than competes with it.
In these three posts, I’ve talked about some of my ideas about how the retail landscape is changing. Thanks for reading.
Next time we get together in a physical world, I’d be interested to hear your thoughts on this topic…maybe we can plan to go shopping together.
