Brick and Mortar retail has to adapt and change with the technology and the times. Sears COULD have integrated retail with online shopping IF they remembered to focus on what ONLINE couldn't deliver. Brick and Mortar retail isn't going away for those who understand it's real value. It has to focus on what the online business can't do... customization of products, personal service and relationship building. If their salespeople became consultants and the products they sold were better suited for customization, they would have built a LOYAL customer base that needed their expertise.
Sears has another chance to avoid closing down
391–400 of 568 posts
Re: Sears has another chance to avoid closing down
#392Earlier quoted context omitted.
I thought this as well until I heard a counter-point [0] which was very convincing. The reason Amazon is successful is not because you can shop online (from a catalog) and receive items in the mail. The reason Amazon is successful is because you can do those things and receive your items within two days. Before Prime existed, Amazon had very quick fulfillment, and after Prime two-day it became even better. The Sears…
Ordering something on Amazon, while it can be fast, can take two months or more to arrive from China, and everything in between. Amazon started as purely a book store in 1994 and stayed that way for a good while; it was not immediately obvious to sell every damn thing imaginable. Bezos was cautious about what to try selling online. In 1998 they announced they would move beyond books, but without specific. Amazon did…
...and eBay didn't have to solve any logistics or shipping problems because they crowdsourced it.
Re: Sears has another chance to avoid closing down
#393Many such businesses have sunk into oblivion in the past century. They were started by hungry go-getters; their well-oiled machinery was handed to much-less hungry people who made poor choices in the face of heavier competition.
The story of Sears vs. Ward ("By the end of the 1930s, Montgomery Ward had become the country's largest retailer") is full of insights. (I was surprised to learn today that 'Wards' is still an online retailer. https://www.wards.com/ )
Re: Sears has another chance to avoid closing down
#394My first online shopping experience was with Sears over Prodigy in 1991. You could browse online, or order from the paper catalog (which is more likely what you'd do because NAPLPS graphics didn't lend themselves well, or at all, to product depictions). Then they'd ship to you, or you could go to the order pickup area at your local Sears store. They had a touchscreen kiosk there where you'd punch in your order number…
My local grocery store had a drive-thru pickup back in the 90s. The strange part was you still had to pick your own items and check out conventionally. Then walk to your car and drive through the pickup area. They converted it to a cart return around the turn of the century. If they simply had a way to order ahead they would have been two decades ahead of the current industry.
There use to retail chain called BEST where the whole store area was a "showroom" and the products were on display outside of their packaging. You were encourage to touch and interact with the product. There was no stock on the showroom floor.
Once you made a decision you would go to the front to place an order, then go to another corner of the store where your item would come out on a conveyor belt.
https://en.wikipedia.org/wiki/Best_Products
Also, the people who owned BEST were really into art and had some pretty groovy looking stores.
Re: Sears has another chance to avoid closing down
#395Earlier quoted context omitted.
Sears is arguably a good example of how execution (and culture) often trump strategy. They were online. They invested in Prodigy. But their heart never really seemed to be in it and they never really changed the way they operated based on online.
I would spin culture the other way too. Sears was a more premium company. They had commission salesmen working the floors. (I think it was as recently as like 2010ish, I walked in to one and looked too long at something was was swarmed) You didn't go there for the "lowest price" you went there for good stuff and when you bought something big they helped you figure it out, they'd show you a dozen fridges, maybe with f…
Reading this, it makes it seem that Sears died because the middle class died. Why did people ditch this middle-of-the-road experience for the cheaper one? Because they were forced to.
Re: Sears has another chance to avoid closing down
#396Earlier quoted context omitted.
The pricing benefit really cannot be understated. Amazon was 40% less than list for books -- which was a massive amount, even if you lived in Barnes & Noble markets (and B&N wasn't as pervasive in 1996/1997 as your average mall bookstore was), where there were similar markdowns. And of course, you could get any book you wanted from Amazon. And then Amazon very quickly moved into media like CDs and DVDs. I used to ord…
I don't remember that big of a price advantage, but they definitely had a HUGE selection advantage compared to the book stores in my city. To a certain extent the price didn't matter much because it was the only way to buy a lot of books.
I agree here. I don't remember price being an advantage at all in the 2000s. I remember it being roughly comparable to local stores, and a refrain was often "but at least you don't pay the sales tax!"
Perhaps on certain things like accessories- IE cables that stores normally had huge margins on- you could find generic equivalents for cheaper prices, but not in a general case.
Until maybe 2009 or so, it was always about selection. I spent a good portion of the 2000s using their recommended book list to figure out what I was going to read next, and when I was almost done with my current book, giving my self a ~5 day lead time to order the next, because that's about how long it generally took. It was an easy tradeoff to make, since a few clicks was a lot less effort than going to a store. I was also reading a lot of somewhat specific programming books in those days that weren't carried by most stores.
Re: Sears has another chance to avoid closing down
#397Earlier quoted context omitted.
I thought this as well until I heard a counter-point [0] which was very convincing. The reason Amazon is successful is not because you can shop online (from a catalog) and receive items in the mail. The reason Amazon is successful is because you can do those things and receive your items within two days. Before Prime existed, Amazon had very quick fulfillment, and after Prime two-day it became even better. The Sears…
There was a significant gap between Amazon launch and having two-day shipping — it took years of behind the scenes development before orders started arriving notably faster than other retails. Sears' numbers include regular postal delivery in both directions so switching to online ordering would have cut them in half with no other changes (and don't forget the efficiency wins from orders arriving as validated electro…
Everyone is jumping over themselves to counter everyone else's memories and theories on "how Amazon became successful" so I hate to add to the ruckus but there is one factor everyone seems to be forgetting that is crucially important in my opinion. That factor was Amazon's approach to customer service, a factor that predates their earning the moniker of "The Everything Store" and was a necessary atep toward success as they first had to get people comfortable with buying things online.
There were several popular books written on the subject of Amazon's customer service model (or ones that used them as a key example to their thesis) that were written long before Amazon ever offered prime and even before they really started taking off. The Amazon of the mid-00's was a major player, but still small enough that they had to differentiate themselves from competitors (at the time) like Ebay and Newegg. Outside of selling media (books, CDs, DVDs, games etc), Amazon's inventory was still mostly limited to the kinds of goods one could also find on those sites (clothing, accessories, electronics) which had them stuck competing on price. What eventually began separating Amazon from the pack was the fact that they would go to extraordinary lengths to take care of the customer. Their return policies were why I stopped shopping exclusively on price well before Prime became a thing as the confidence that I could teturn an item in reasonable condition (as in I could still return something after discovering a flaw after opening it) for free (in almost all reasonable circumstances) and without having to do anything more than print a label and drop the box back by a UPS pickup location was a gamechanger in building my confidence in online retail. It was to the point that making s return with Amazon was easier than making a return to a store and thar was the edge they needed to convince consumers fo choose Amazon over not only other online retailers, but ohysical stores as well.
The rise of 2 day Prime shipping undoubtedly fueled their exponential growth and made Amazon what it is today. However, I doubt they would have ever had the ability to build the infrastructure needed to make Prime work if it wasn't for the initial wave of consumers becoming loyal customers due to their reputation for customer service.
Re: Sears has another chance to avoid closing down
#398Sears is a macro-example of the phrase, "The market can remain irrational longer than you can remain solvent." Seems like this company has been walking dead for years. When the October news hit that Sears was going out of business, my wife and I used up all our Sears points (kind of like airline miles) to get tons of free food from Kmart. Then Sears kept just giving her points so we kept getting free stuff. How on ea…
I had a friend who worked at Kmart during the Sears transition and stayed until it closed a few years ago (or so). He worked there for maybe 12 years total, and maybe 7 of that as a manager. The first week after he started there, he started to wonder how they could stay in business. He said most of his time (in the 12 years) was spent walking around, cleaning, organizing or just watching TV just because there wasn't…
I did 5 years (16-21) at my Kmart and it was exactly the same. No customers most of the time and when we did we never had what they wanted.
I spent most of my time watching TV in electronics, sometimes even took naps in the back. That company was destined for doom.
Re: Sears has another chance to avoid closing down
#399Earlier quoted context omitted.
There was a significant gap between Amazon launch and having two-day shipping — it took years of behind the scenes development before orders started arriving notably faster than other retails. Sears' numbers include regular postal delivery in both directions so switching to online ordering would have cut them in half with no other changes (and don't forget the efficiency wins from orders arriving as validated electro…
The pricing benefit really cannot be understated. Amazon was 40% less than list for books -- which was a massive amount, even if you lived in Barnes & Noble markets (and B&N wasn't as pervasive in 1996/1997 as your average mall bookstore was), where there were similar markdowns. And of course, you could get any book you wanted from Amazon. And then Amazon very quickly moved into media like CDs and DVDs. I used to ord…
> Amazon was 40% less than list for books -- which was a massive amount, even if you lived in Barnes & Noble markets (and B&N wasn't as pervasive in 1996/1997 as your average mall bookstore was), where there were similar markdowns.
This.
But even for pure list, Amazon didn't pay sales tax so had a 5-8% advantage.
Amazon killed all the technical bookstores in short order because of that pricing advantage that they didn't deserve.
Re: Sears has another chance to avoid closing down
#400Earlier quoted context omitted.
I'm not well versed on the subject but I recently learned that Amazon's share of a book's purchase price is HUGE at around 40% (21.60 on a $54 book) I suppose the lesson is that there is a lot of value in being a distributor as I also know someone who is a part owner of a brewery and he says the same thing. Source: http://fabiensanglard.net/gebbdoom/
That is the case at pretty much any retailer. Grocery stores, drug stores, clothing stores, etc.
Don't forget app stores, music distributors, etc!