All over the country, there are retail stores closing down. Many factors play into this trend, but ultimately, they all boil down to this simple fact: stores are going out of business because they don't meet the needs of modern consumers. Let's unpack that statement in more detail to find out what remaining retail stores need to do to survive.
Many branches of big-name retail stores shut their doors in 2016 and 2017. For example, Payless ShoeSource closed 400 stores across the nation, while JC Penney closed 138 stores. Even the iconic retailer Macy's shut down 68 stores. As a result of so many stores going out of business in a short period, many retail experts have begun to speculate on the reasons for the closures. In general, they agree that this latest round of stores closing is simply the latest step in the long-term evolution of retail.
In the past, retail stores were places where product manufacturers could display their wares to consumers and persuade them to buy. However, thanks to the growth in popularity of online shopping and online advertising, product creators can now market their goods directly to consumers through websites, mobile apps and social media. As a result, some retail stores are closing because they are no longer necessary as places to display and sell goods.
Another reason for big-name stores closing is that they no longer offer the types of products customers want. Whereas previous generations of consumers craved mass-produced goods created by global brands, today's young consumers prefer to seek out artisanal items that are locally sourced and ethically made. Therefore, while big stores close down, smaller local stores are popping up in many locations, offering Generation Z consumers the authentic and unique products they desire. These small, independent retailers offer hope to many downtown areas, which otherwise would become ghost towns filled with out of business signs and empty lots.
In the face of so many stores closing, some retailers are choosing to adapt their business models in an attempt to stay in business. Rather than simply being places where people go to buy goods, some stores are rebranding themselves as places of entertainment. For example, some grocery stores have started offering cooking classes to entice shoppers to come into the store, while bookstores hold regular poetry readings to lure customers away from shopping online. This kind of strategy can be highly effective, particularly with millennial consumers, who tend to value experiences over possessions.
The retail environment is changing rapidly, which leads to many stores closing down. In order to stay open, stores need to change the way they operate to appeal to the new generation of consumers, who demand an interesting shopping experience and access to high-quality, authentic products that they cannot buy anywhere else.
Photo courtesy of cbenjasuwan at FreeDigitalPhotos.net