By Zach Brundage

It seems like any time retail is in the news, another pillar of the industry shuttering its doors. It’s easy to get the idea that brick and mortar retailers are all struggling, falling to the might of Amazon and the growing wave of online Direct to Consumer brands. The media has taken to calling this shift as the “Retail Apocalypse”, but despite appearances, physical retail is performing strong. What’s really happening in the retail space is a transition to adapt to evolving customer expectations in the online era. Retailers are utilizing every tool in their arsenal to compete and even flourish in the current climate. Additionally, we’re seeing an increasing number of ecommerce retailers moving into the physical space.

It’s important to recognize what has been changing in the retail landscape and acknowledge where there are struggles. The automotive industry is the single largest sector, accounting for an estimated 23.7% of US retail sales. Economic uncertainty and rising interest rates have impacted auto sales, which in turn brings down US retail as a whole. The same eMarketer forecast has automotive spend remaining flat through 2022.

But even if we factor out auto sales, other major retailers are closing stores at an alarming rate, right? Not so fast! What news reports about the “Retail Apocalypse” fail to mention, is that for every retailer that’s closing down physical locations, 5.2 are opening new stores. It’s also important to note that of all the store closings, 73% belong to only 16 retailers. While news about titans of retail such as Sears, JCPenney or Toys R Us shrinking or closing entirely may paint a gloomy picture, it is not indicative of the greater trends in physical retail. In fact, an estimated 2,780 new retail locations are slated to open in 2019.

So how can all these retail locations keep opening while Amazon and other online retailers are growing at such a large rate? The answer lies in the scale that these ecommerce retailers had been working up until this point. According to the U.S. Census Bureau, 90% of retail sales are still transacted in-store. Despite all the strides online retail has made in fulfillment, there are large swaths of America that remain difficult to reach at reasonable costs, negating a lot of online retail’s benefits and leaving many consumers loyal to physical retail. Rural areas often have fewer options than metropolitan markets, and the distance between households prohibit the same online fulfillment convenience offered to more populous urban neighborhoods.

Fulfillment isn’t the only hurdle online retail has yet to overcome. Trust is a major issue that effects ecommerce. Consumers are wary of counterfeit items that plague online marketplaces. As long as ecommerce giants like Amazon and Alibaba continue to offer a marketplace for third party sellers along with their first-party fulfillment, these brands will have to contend with consumer uncertainty and a loss of trust as a result of less scrupulous sellers. The ability to look at a product beforehand, ensure that it is a quality item and rely on store clerks for recommendations and support is a major distinguishing benefit of physical retail that instills trust and loyalty.

Customer uncertainty may benefit physical retail, but brick and mortar stores aren’t resting on their laurels. Major and minor retailers alike are finding renewed success through differentiators and are borrowing from the strengths of ecommerce. Creating a seamless online experience is now a necessity for all retailers. Shoppers are increasingly using their smartphones while shopping in store, expecting features such as item availability, product information, customer service, coupons and discounts, as well as mobile payment.

Evolving their online experience doesn’t mean that retailers should neglect the customer once they’ve been driven into the store. Providing shoppers with a superior in-store experience will ensure repeat visits and reinforce the value of buying in person. Brands like Wegmans, Publix and Trader Joe’s have been cited as customers’ favorite grocery chains as a result of the extra attention paid to the in-store experience. Shoppers have come to expect such conveniences as food demonstrations, knowledgeable and friendly staff, cleanliness, item availability and speed to check out. It’s hard to ignore the ability to shop online from the comfort of your own home, so retailers need to continue to prove that they can offer experiences that online retail cannot.

While physical retailers are becoming more online savvy, ecommerce brands are increasingly opening their own brick and mortar locations. Many of these locations are utilized as showrooms or pop up locations, allowing customers to interact with products before ordering online. Other brands including Amazon are also opening fully stocked stores leveraging their brand name and cutting-edge payment technology. Regardless of format, online retailers are estimated to open 850 physical locations over the next 5 years.

What we’ve realized is that the “Retail Apocalypse” is nowhere to be seen, but rather the reality is a more nuanced evolution in how the entirety of retail operates. Some segments are facing struggles while other are shifting and succeeding. Physical retailers are adapting to customer expectations, some by incorporating online tactics, and others by capitalizing on the natural strengths of brick and mortar presence. Online retail still has challenges to overcome in order to continue its upward climb. At the end of the day, if you’re fearing the end of physical retail at the hands of ecommerce, just remember that only 1/10th of all US retail is online, and physical retail isn’t going away.  We understand the retail and media landscape evolution.  NSA can help drive traffic or trips to any destination!  Please reach out to