Dead Brand Walking?

There was plenty in the news this week about office supply retailer Staples’ decision to board up 225 stores in North America by the end of next year, on the heels of Radio Shack’s announcement they were shutting down 1,100 US stores. (It's gonna be a lot harder to find legal pads.)

Stores have to “earn the right to stay open,” Staples’ chairman and CEO Ron Sargent says. Agreed, says CBRE SVP retail Tom Balkos. While there’s been plenty of chatter about the impact that e-commerce is having and will have on stores--bricks versus clicks--the Internet is not the death knell for the retail experience at all, Tom says. There are product categories that people would just rather buy online--they don’t need the touch and feel. (You don't need to try on a cordless mouse, they always fit.)

Something like fashion is entirely different than office supplies. And people still enjoy the social aspects of going to a big box store, for example. Call it the release of the happy endorphins. One is paying for the experience of shopping at a retail location as well as the actual product, Tom adds. Chains like Staples, which does nearly half of their business online now, are “optimizing their network, assessing the cumulative effects of online shopping” amongst other locational considerations like cannibalization and relo opportunities.

In response to those shoppers that go to the showroom experience, see what they want, then go home to buy on Amazon--it’s up to the bricks and mortar guys to up their game. “It’s about delivering a compelling in-store experience,” so the shopper doesn’t hesitate to buy there. It's as much about the personal identification with the store brand and service as it is about the personal satisfaction of buying the product and bringing it home. “Does the shopper get personal satisfaction from shopping there because it feels good?” Tom asks. (That's a question that has perplexed philosophers since Plato.)