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In
an article titled The
Obsolescence Of Brick-and-Mortar Sullivan
wrote, "Brick-and-mortar retail stores selling
everything from clothing to high-ticket items like
flat-screen TVs will turn into warehouses where
consumers can touch and feel the merchandise. Websites,
supported by search engines and site search, will become
the cash cow for the retail store. Advertisers will
have more of an opportunity to address consumers because
many will spend the time online that they would
have spent in the store. Tracking sales and pulling in data
from social sites to target consumers with specific
ads, coupons and discounts will become much easier for
marketers."
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Now,
as you would expect, skeptical commentators on Sullivan's
blog pooh poohed her prediction pointing out that similar
predictions have been made (and failed to materialize)
for the past 20 years. I don't think it will happen
either, though
I'm certain the web will continue to take market share
away from brick-and-mortar year after year. Even so, I
can't get a comment out of my head that David Carr
made in a New York Times article
Sunday about new media replacing old platforms like
newspapers and magazines (I wrote about that article in
depth yesterday).
Carr wrote,
"Those of us who covered media were told for years
that the sky was falling, and nothing happened. And
then it did. Great big chunks of the sky gave way
and magazines tumbled — Gourmet!? — that
seemed as if they were as solid as the skyline itself. But
to those of us who were here back in September of 2001, we
learned that even the edifice of Manhattan itself
is subject to perforation and endless loss."
The unthinkable
happened in media, so as preposterous as Sullivan's
prediction appears to be on the surface and as much as I
can't see it happening over a five-year span, recent
history has shown us that with the disruptive power of the
internet at play, anything is possible.
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Sullivan makes some
persuasive points noting, "There are several
reasons retailers would want to move sales
online. For starters, it's less expensive to sell
that way. Retailers can stock less inventory. Most
well-run online sites pass on the order to a
fulfillment house or manufacturer. That can mean 100%
margin when drop-shipping the order, says Sucharita
Mulpuru." Mulpuru is a Forrester
Research principal analyst."
Sullivan
wrote, "Sales on the Web have been outpacing
store sales for several years. In fact, online
divisions of multichannel retailers typically outpace
their brick-and-mortar counterparts by between
20% and 30%, Mulpuru says. "It
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should be cheaper to transact
business online," Mulpuru adds. "You
don't have to pay for visual merchandise or for
physical stores." Sullivan also quoted EMarketer
Senior Analyst Jeffrey Grau who says
store-based retailers are tired of seeing online
retailers eat their lunch. As a result Grau
said the brick and mortar crowd "will compete
more aggressively against Amazon and other
pure plays in 2010 as they turn to the Internet as
a source of growth. "They must be envious
of Amazon's strong 2009 sales growth
figures," Gray concluded. |
I
already do most of my shopping online. After running the
Black Friday brick and mortar gauntlet a couple
of years ago, I will never do that
again! I happily spent Cyber Monday online knocking
out a big chunk of my Christmas shopping and everything
will be delivered to my door tomorrow. No fuss, no muss.
I don' think even Sullivan believes that every
retail store will be subjugated by the web in five years,
but even if it happened with the majority of stores, I
could see myself getting along just fine in that
environment and being positively ecstatic
about what such a development would mean for the value
of domain names that identify specific products and
services.
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One
other note today - in an announcement I was
especially excited to hear, DomainSponsor,
who is organizing the DOMAINfest
Global conference coming up in Santa
Monica, California next month, announced that
they will hold a Networking Dinner Party for
attendees at the Getty
Center on Wednesday, January 27.
Whenever I am in a major city, visiting the top
local art museum is always on my To Do list.
The
Getty is really something special too. It
sits on a 110-acre hilltop site in the
Santa Monica Mountain range. DOMAINfest attendees
will have exclusive access to the campus, which
offers dramatic architecture, tranquil gardens and
breathtaking views of Los Angeles and the
coast. If you are a Project Runway
fan, you probably saw the episode a few weeks back
that was shot at the Getty and revealed what a
truly spectacular site it is.
DOMAINfest
guests will also have exclusive access to the West
Pavilion and its collection of important works
of art, as well as to the Special Exhibition
Pavilion, which includes a limited-time Rembrandt
exhibition on loan to the Getty. To
facilitate networking and fun, the DOMAINfest
party at the Getty will feature a sketching
competition and a mystery art quest that involves
unlocking a secret code using clues related to art
work on display in the West Pavilion. with some
great prizes going to the winners. This is an
event I am really looking forward to.
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Photos
from The Getty above and
below courtesy of Getty.edu
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