business news in context, analysis with attitude

interesting juxtaposition of stories recently about two upmarket retailers that are firmly convinced that physical stores keep them relevant to their shoppers.

CNBC had an interview with Williams-Sonoma President and CEO Laura Alber, reporting that “as Williams-Sonoma's business shifted from selling via catalogs to selling online, the furniture and kitchenware retailer remained consistently adamant about one thing: its stores.”

“"Even Amazon believes that they should have some real spaces," Alber told CNBC. "When you go in a store and it's wonderful, it helps you make the purchase … We see our best customers cross-channel. There’s a lot of people just online, there's a lot of people just focused on big stores. We are focused on both because we know that's how you shop.”

At the same time, VentureBeat had an interview with Apple retail chief Angela Ahrendts, who says that “while she believes shopping will continue to move online over the next five years, actual purchases will still largely be done at brick-and-mortar stores.”

“The smart outside guys, they don’t say retail’s dying,” Ahrendts says. “They say digital’s going to grow at three times the rate of physical. But in the next five years, and this is a McKinsey number … 75 percent of the people will shop online — shop, to ‘learn’ — but 75 percent of the business will still be done in physical stores. And so retail’s not going away. Retail’s not dying. But it has to evolve … I think it has to serve a bigger purpose than just selling.”

And, the story notes, Apple has carved out a unique position for itself: “Beyond actually selling products and acting as hands-on showrooms, Apple’s stores provide local repair services, classes, and free internet access for customers, virtually guaranteeing foot traffic at all hours.”
KC's View:
I think we can stipulate that both Apple and Williams Sonoma run stores that are aspirational and not mediocre … the key is that when you go into these stores, “it’s wonderful.” Or at least more wonderful than a lot of other retailers.

Ahrendts, of course, is right - retail isn’t dying. Just evolving. It’s just the mediocre stores that may find themselves endangered.