The Apocalypse of Brick-and-Mortar Stores Has Arrived in Full Force
As always, the American market serves as a valuable database of statistics to understand what is happening and what will happen in the world.
Today, we talk about commerce and e-commerce.
These two brothers can be mutually helpful, yet at the same time, one can be the nemesis of the other.
I would like to reflect on the current trend in the commerce sector, both online and physical, following the recent Black Friday and Cyber Monday weekend.
According to Adobe Analytics, online spending for Black Friday in the United States reached a record $9.8 billion, up 7.5% from last year.
Additionally, online sales during the Cyber Weekend increased by 7.7%, reaching $10.3 billion.
These are both exciting and alarming figures.
Giants like eBay, Amazon, Etsy, and Shopify are licking their chops at these incredible performances.
Profits are soaring to the sky.
This isn’t just a shift of shoppers to online platforms; it’s a veritable exodus.
Even online retailers see a gigantic opportunity to generate profits that, until recently, were unimaginable.
And what about brick-and-mortar stores?
How can they face this challenge?
Consumers are increasingly inclined to shop online for convenience and to avoid crowds, and, undoubtedly, after tasting this nectar, they have no intention of going back.
So, what to do?
Adapt or innovate?
Resist or find new strategies?
Walmart and Target, for example, are implementing strategies that cannibalize their own stores. They push significant offers that can be purchased exclusively online through their portals. In my opinion, this strategy is completely crazy.
People love to browse and buy on Amazon and eBay, while they do so with less enthusiasm, almost none, if they have to do the same on Target’s site.
The trick?
Improve the customer experience.
Another huge advantage that users have acquired online is the ability to pay in installments without the need for banks or traditional financial institutions.
This is the “buy-now-pay-later” (BNPL) service, like Affirm, Klarna, and Afterpay.
These services contributed to creating $5.9 billion in online spending between November 1st and 23rd, an increase of 13.4% compared to last year.
This does not happen in physical stores, a lack that further pushes people to buy in front of their monitors comfortably seated at home.
As if this were not enough, other super aggressive players that no one could have imagined just a few years ago are entering the scene.
We’re talking about TikTok and Temu.
For example, TikTok launched its online store in the United States in September, offering free shipping and discounts of between 20% and 30% on a wide range of items.
This shows how social media is becoming an increasingly relevant platform for e-commerce.
Are we about to say goodbye to physical commerce?
Will we see most stores disappear?
Are cities about to empty out, and malls to become settings for zombie movies?
Unfortunately, the answer is yes if alternative solutions are not found.
The World Economic Forum has been clear; capitalism as we know it must die.
But if this is really the way forward, we should ask ourselves some questions.
One of these is very simple.
Why is Amazon opening physical stores?
Perhaps the strategy is different.
To sweep away commerce built by many small family realities and impose a new monopoly.
A story that has been mechanically repeating itself for thousands of years.
Author: Koan Bogiatto
Koan Bogiatto has explored approximately 123 countries around the world and, after living in Italy, Spain and then in the USA, Florida. He is the only Italian to have received the prestigious Green Card for Extraordinary Achievement and Outstanding Individual from the U.S. Government, in the fields of education and coaching. In the past Koan has served as a consultant for eBay, INA Assitalia, Wind, 21st Century, Alviero Martini, Politecnico di Torino, IUM Monaco, Sai, De’Longhi Group, and Il Sole 24 Ore. “He is the founder of several successful companies in various fields, including coaching, education, real estate, and cryptocurrency trading, to name a few.”
