In a recent report by Forrester Research, U.S. online retail sales are projected to reach $262 billion this year. The staggering number may be good news for online-only stores, but some industry insiders think the figures may prove ominous for those in the business of building and investing in retail sites.
Others disagree and see the silverâ€”or sheetrock-coloredâ€”lining. â€œPeople make big statements about online shopping wiping out physical retail, but in my opinion itâ€™s like the movies of the future where there was only one car on the road. That didnâ€™t happen and neither will this,â€ says Michael Ellis, a partner at the Hollywood, Calif. design studio, 5+ design.
In fact, the huge online shopping projection could mean exciting things ahead for developers and investors of retail real estate. As architects and builders are forced to â€œup their game,â€ Ellis says, consumers will notice a profound effect on the bricks-and-mortar environment of physical stores.
â€œThe kind of character and design a retail store has will become much more important,â€ he says.
Ellis doesnâ€™t buy into the notion that online sales will completely destroy the physical retail industry. Rather, he says online shopping augments the experience of being in a store. â€œThe Internet has allowed stores to project their identity a lot more easily than they have in the past,â€ he says.
Ellis cites Apple, Inc. as an example of a brand that capitalizes on this symbiotic relationship. â€œApple spends a tremendous amount of time and energy creating a specific retail environment and that goes hand-in-hand with a strong Internet presence,â€ he says.
This relationship is further highlighted by technological integrationâ€”such as smartphone apps to direct consumers to particular productsâ€”that make being in a store or browsing online similar events in a consumerâ€™s mind.
â€œStores wonâ€™t go away because people like differentiation and variety,â€ Ellis says. â€œI donâ€™t think thatâ€™s ever going to change.â€
By Melissa Kandel, REALTORÂ® Magazine
Beyond Bricks & Mortar
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