The competition between brick-and-mortar retailers and their electronic counterparts—especially Amazon—is long-standing, persistent, and constant. But even as many skeptics continue to warn that physical retailing is not much longer for this world, various stores are pursuing a wide range of tactics to ensure their survival and to continue giving consumers a place to visit when they are ready to make their next purchase. Consider a few of them:

• Go smaller. In urban locations, Target is opening smaller versions of the familiar big box stores that appear mainly in suburban areas. The 130 new stores give city shoppers convenient access to the range of products that the general merchandiser carries, without requiring them to get in a car that they might not even own.
• Compete on price. Discount retailers such at T.J. Maxx and Marshalls offer discounted merchandise, such that the items are comparable in price to what consumers can find from Amazon. But they also offer the fun of a “treasure hunt” setting, in which shoppers can feel like they are skilled and savvy consumers, because they have found such a great deal on designer fashions. Accordingly, the parent company TJX anticipates increasing the number of stores it runs worldwide under its various brands, from around 4000 to as many as 5600.
• Create exciting, compelling in-store experiences. The treasure hunt is not the only experience that customers enjoy in stores. During a recent holiday season, Walmart hosted parties, run by store employees sporting reindeer hats. Shoppers could enjoy the festive atmosphere while also observing demonstrations of some of the latest toy options and technological gadgets.
• Rely more on in-store technology capabilities. Various applications and software capabilities are increasing what retailers can offer customers in stores. Cosmetic counters in Neiman Marcus feature mirrors that also record interactions between customers and the expert sales personnel. The video then gets sent to the customer’s smartphone, so that she can go back to watch exactly how the makeup artist created her smoky eye, step by step. Another option is facial recognition software that can alert sales clerks at the very moment their best customers enter the store, so that they can be ready with recommendations and dedicated, personalized service offerings.
• Give up. This last option is a little different, but it cannot be ignored. Whether in full or in part, many famous retailers are exiting the market. Lord & Taylor sold its flagship New York City store, though it continues to operate in other locations. Sears has closed hundreds of stores. Toys ’R Us and Gymboree have entered bankruptcy proceedings. And Radio Shack simply has stopped existing.

Discussion Questions: 

1. What are traditional stores doing to compete with Internet retailers like Amazon?
2. Which of these tactics are most likely to succeed? Justify your answer.

Source: Michael Corkery, The New York Times, November 14, 2017. See also Esther Fung, “Stores Borrow Tricks from Online Retailers,” The Wall Street Journal, January 30, 2018