How Amazon Is Changing the Game and Why You Should be Happy About It
This past week, CNN Money reported that two major store outlets, Game Stop and Sears, have taken steps to downsize as a result of poor financial straits. Game Stop reported lackluster video game sales and has been forced to shut down 100 of their stores. Sears, while determined to stay afloat, holds a pessimistic outlook on their entire existence as a company. While both of these stores focus on selling different goods, both companies’ woes can be attributed to e-commerce, especially the rise of Amazon. Game Stop’s brick and mortar stores have been floundering amongst the competition of Amazon, direct downloading to the video game system (instead of needing a physical disc), and the rise of tablet and mobile games. While Game Stop attempted to control the damage by selling pop culture merchandise such as vinyl figures, they still were forced to shut down some of their stores. While Sears’ financial problems started before the rise of the online market, internet commerce has only hurt the already wounded Sears. JCPenny, Macy’s, and Staples have had to make similar cuts within the past year.
Seeing big names like these companies struggle may seem nerve-wracking. As much as I’m guilty for ordering a book online rather than going to a brick and mortar store, it feels nerve wracking to imagine companies like Staples and Game Stop closing down their traditional stores when there isn’t even a recession going on. With Amazon’s rise to power, it has begun to create its own physical locations such as a supermarket without a need for checkouts, but they aren’t the same as mall stores. There is a certain allure to the box store in which you enter a storefront with or without an idea of what you want to buy, browse the displays, and have the ability to interacting with other people. Is the world going to turn into this impersonal e-commerce interface in which you don’t even interface with a bagger? Not so fast. Not everybody is succumbing to the growing power of Amazon.
Two of the best examples of companies that are keeping up with e-commerce with stores are Ulta and auto part stores such as AutoZone. Ulta has been able to flourish as a box store because of the need to try makeup on, hence the need for physical stores. One cannot simply order a concealer and assume the shade works with one’s skin. Auto part companies take advantage of another aspect of online ordering: time. Most of the market that makes up replacement auto parts are professional mechanics, and because they need said part almost immediately, they rely on box stores to get that part in a timely manner. Amazon’s two-day shipping would only appeal to those who are treating their repair like a hobby rather than a necessity. Both of these companies have completely different approaches to solve the internet competition brought forth by Amazon, but both are seeing success in the same era of others’ failures.
What makes our economy fun and exciting is competition, and Amazon has brought forth one of the best conundrums of our time. How can one have a box store in a time of e-commerce? Thankfully, consumers like us can only gain from such a boon as these titans duke it out. These companies will be rallying their troops with enticing deals, products and strategies, all to get us to buy what they’re selling in the name of garnering brand loyalty. The consequences of a changing world are hitting businesses, so we will likely be treated to watching innovative companies flourish and those stuck in their ways floundering. What will be the new norm of box stores, if there is a change? I , for one, am excited to find out.