Traditional retail stores all over the country are following each other in a Conga line straight out of the business with a look of defeat in their eyes. Big name retailers are announcing store closures by the hundreds as the internet wins over consumers with its efficiency and ease. The growth of e-commerce, Amazon in particular, is beginning to cause serious shifts in the way people shop, and the effect it is having on traditional retailers can not be overlooked. The future is changing right now, and we are a part of it. Every single time a consumer buys something online, they are contributing to the cyber shift that will set a precedent for years to come. Not long from now we will remember traditional retailers as a thing of the past.
Radio Shack closed 1784 stores in 2015 due to bankruptcy and competing businesses, according a CNN report from 2015. Additionally, the report stated in 2016 Sports Authority announced they are closing 450 stores because the store faced inevitable competition from more powerful retailers.
USA TODAYreported Macy’s recently announced their plan to close 15% of its stores in 2017, Sears is closing at least 10 Sears and 68 Kmart stores before the end of April and CVS just released its planning to close 70 locations across the country.
The most shocking closure comes from the world’s largest retailer. According to USA TODAY, Walmart said it was closing 269 stores around the world to focus on their supercenters and to improve their e-commerce business to compete with Amazon.
These are just a few examples that demonstrate what damage the “Amazon effect” has had on what used to be stable, leading companies around the world.
“I don’t think many traditional retail CEOs would say publicly, ‘Amazon is eating our lunch,’” said Retail Metrics President Ken Perkins. “But traditional retailers are not hiring anywhere near the number of people needed to offset the store closings we’ve seen.”
While brick-and-mortar retailers are falling like dominoes, Bloomberg’s Devin Leonard reports that Amazon’s annual revenue has grown from $34 billion to $107 billion in six years with no signs of slowing down.
Amazon’s reliability, accessibility, timeliness and uniqueness are all helping to create an e-commerce monopoly in an increasingly technological world. Amazon Prime’s promise to deliver packages in two days is incredible and hard to resist. I would rather order from Amazon Prime than drive through Baton Rouge traffic to a Walmart, just to buy something they may or may not have in stock. It’s simply easier.
Amazon has also developed the Amazon Dash Button, which is described on their website as a “Wi-Fi connected device that reorders your favorite product with the press of a button. Each Dash Button is paired with a product of your choice, which is selected during the setup process. When you’re running low, simply press Dash Button—ensuring you never run out of your essentials again.”
Not only do you not need to run to the store, but you don’t even need to open your computer to login to Amazon. Just press the button. That’s it.
Skeptics may say that it is unlikely the e-commerce of Amazon will be able to make big time retailers such as Walmart obsolete in the future. Amazon is aware of the competition and has adjusted their sails accordingly.
They have recently introduced Amazon Go, a physical store people can shop at for everything they could get at a Walmart. The difference is that, at Amazon Go, there are no checkouts or no lines. Amazon explains the store on their website as a “checkout-free shopping experience made possible by the same types of technologies used in self-driving cars: computer vision, sensor fusion, and deep learning. Our Just Walk Out Technology automatically detects when products are taken from or returned to the shelves and keeps track of them in a virtual cart. When you’re done shopping, you can just leave the store. Shortly after, we’ll charge your Amazon account and send you a receipt.”
The overall effect Amazon has had on companies, the consumer and the economy has no doubt changed the way we shop. I predict in just a few years, almost all retailers will be considered old-fashioned except for Amazon and a few other power centers. I think the take over of e-commerce is long overdue and will do nothing but good things for the market.
Casey Pimentel is an 18-year-old mass communication freshman from The Woodlands, Texas.