Retailers that emerged in good shape from the long economic downturn have a right to feel proud.
But not for too long, especially in the case of retailers that operate primarily with physical stores.
As it turns out, this breed of retailers will face particular challenges in the next few years because of stagnant population growth and heightened competition from digital players.
That was the word from Dan O’Connor, president and CEO, RetailNet Group, LLC., who spoke during the Tuesday afternoon session at Future Connect 2011.
“By 2015 we’ll realize we have too many stores,” he said. “E-commerce will take more share from stores”
Moreover, younger, affluent shoppers will increasingly move to online shopping, pulling a critical base from store-based retailers, he added.
O’Connor said store-based retailers need to rethink their strategies by asking themselves crucial questions. “How will the market of 2015 be different? What does that mean for where I locate and for the size of my stores? What does it mean for how I departmentalize my stores?
Retailers were urged to “create on-ramps for younger consumers to shop your store before they are 25 so they get into a pattern.”
O'Connor offered some good food for thought, even if it left retailers with more questions than answers. But retailers have a history of developing relevant solutions once they understand the problems at hand.