The ‘other’ Amazon effect

The rising popularly of online shopping, especially on Amazon.com, has posed significant challenges for brick-and-mortar retailers.

“Within the shopping center owner community, they don’t like Amazon because Amazon competes with retail tenants that occupy space in their shopping centers,” said Dan Rosenfeld, principal of Mid-America Real Estate – Wisconsin. “(Amazon is) a threat to that traditional brick-and-mortar shopping center platform.”

Earlier this year, RadioShack announced plans to close1,100 of its stores, and Staples recently announced it will shutter 225 stores.

To survive in the new retail world order, nearly all retailers need an online presence to complement their brick-and-mortar stores. And despite the rise in popularity and the convenience of online shopping, brick and mortar stores still have some advantages. Only a brick and mortar store can allow a customer to actually see, touch and try on an item before buying it.

“(Online customers) want to be able to browse, they want to be able to research, they want to be able to compare prices. That’s just a fact of life that we have to be cognizant of,” said Kathryn Bufano, chief executive officer of The Bon-Ton Stores Inc., the Boston Store parent company that has headquarters in Milwaukee and York, Pa. “(Customers) also like (to) browse online and go into a store and see the merchandise. Being in the apparel categories, being in the soft home categories where people want to touch and feel and understand, that’s an advantage for us.”

And the buying experience of a brick and mortar store allows the buyer to obtain the item immediately, rather than waiting for an online order to be delivered.

“The store experience is really about impulse,” Bufano said.

Brick-and-mortar retailers must increasingly emphasize the fun of the shopping experience to compete with the convenience of shopping online at home.

“People have been going to the market or the marketplace for thousands of years. There’s something communal, there’s something exciting (about it),” Bufano said. “The mall is fun. Lifestyle centers are fun… Shopping is fun. Shopping is part of our lifestyle, and it’s not going to go away.”

More shopping centers, such as Bayshore Town Center in Glendale and Mayfair Mall in Wauwatosa, are adding restaurants, movie theaters and other entertainment amenities to enhance the shopping experience.

“I think all of the retailers are trying to create a sense of place and offer more entertainment value within the shopping center experience to give the customer a reason to come to the stores,” Rosenfeld said.

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