Andrew Yang, the founder of Venture for America, is predicting that 30% of all malls in the US will be closing in the next 4 years. This is mainly because Amazon is soaking up $20 billion in commerce every year. Customers are running away from malls. What are we doing wrong?
There are many questions that those in retail are having to ask themselves. Are there too many malls? Do people have less time to shop and doing it online is more time efficient? Is there no experience worth going to a mall for? It's all of the above and then some. Add into it the fact that Millennials have no shopping patterns and you've got an industry that is in transition. It's hard to say where the evolution will take us, but there are several facts that we know. Malls will close. Customers will continue to shop online and in brick and mortar. The brick and mortar stores that will succeed are the ones that are succeeding now. Authentic, luxury, experiential stores that are well branded and easily accessible are some examples. The divide will continue to grow between service that is done by one's self and that which is luxury provided by a service representative who wants to be there, empathetic, knowledgeable and offers an intimate shopping experience. Shoppers will be fine with both as long as they understand the expectation. It's when we miss the expectation from a customer that we miss the opportunity. Perhaps that is the biggest reason why retail is declining. We missed the opportunity to deliver on an expectation.