October 18, 2010
By the ZippyCart Shopping Cart Reviews Content Team
The recent National Retail Federation (NRF) report about holiday shopping asked a question that is on everyone’s mind: is online shopping killing the traditional retail store? The NRF provided the following answer to this question:
Retailers know that many of their customers like to shop in a variety of ways. If they want to ship a gift directly to a recipient or shop at odd hours, they may choose to shop online. If they want to easily browse for gift ideas or touch merchandise before they buy, they’ll shop in a store. Most retailers do not care if customers shop in stores or online as long as they shop with them.
Some may say this is spot on, others may say it’s wishy washy, and still others may believe it’s way off base. This is because there is a trend going on in America that can’t be ignored anymore: more and more retailers are moving from the corner store in your neighborhood to the virtual world of online shopping.
Since 2001, the online marketplace has grown from $48 billion to $155 billion, and that growth is expected to continue with $173 billion this year and $249 billion by 2014. That said, last year’s earnings were only 7% of all retail sales in the country according to the NRF.
As more consumers move online to find the best deals, big box stores are working even harder to keep up. J.C. Penney, for example, has equipped some of their stores with online kiosks to help shoppers stay connected with their online presence while in stores. Chains like Macy’s have seen a 31% increase in online sales so far in 2010, and expect that number to be higher by the end of the 2010 holiday shopping season. To keep up with this demand, Macy’s is adding to their sales staff while also increasing their number of distribution centers.
So it would seem that online shopping is helping big-box retail, but few realize that many niche retail stores are also seeing the pot of gold at the end of this rainbow. “The Internet offers an almost even playing field for the small neighborhood boutique” says Kaitlen Banks, owner of a vintage fabric store in Western Iowa. “By moving my business online, I have been able to double sales and reach consumers all over the country. And through using a live chat tool, I’ve been able to provide the same local hospitality and customer service, which keeps people coming back just as they would if they lived in my neighborhood.”
Maybe the NRF is right, many retailers enjoy offering both an online and offline presence to meet the needs of every consumer. As such, it is clear that for now, online shopping isn’t killing traditional retail, in fact many would say it’s making things even better.
Nick was born and raised in California, but has been working the dot com scene in Seattle for many years. He co-founded ZippyCart back in 2009, and now works here full-time. Nick wears many hats at ZippyCart, including producing content for our Ecommerce News blog. Nick loves photography and the outdoors, so when not working on ZippyCart you can find him out and about in Seattle.
I think we’re only in the infancy of online shopping, and yet, it is already a $173B powerhouse. I think the internet may eventually kill certain retail verticals, transform others, and leave others the same. Agree with you about niche retailers benefiting.
Just discovered your site and think its great. People need more help navigating the ecommerce waters. Keep it up.
I try to do all my shopping online – it’s easier and cheaper. Also would recommend going to this website, http://www.thegiftmeadow.com. I’ve found a lot of unique stuff there I can’t find at a local store.
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Online shopping is all very cheap and convenient until someone needs a job. Music stores, movie rental stores, small hardware stores, newspapers, small grocery stores, etc. all boarding up. Where are kids (and now seniors) supposed to get a job? At some point, we all need a paycheck.