This past weekend, my father walked into the house with a 50-inch television. My mother, who never refuses a good deal, decided to buy a new pair of shoes for my brother. Yes, they had fallen victim to the annual urge felt by consumers around the country during Thanksgiving weekend. Black Friday’s effects once again found a way to sneak into my cozy home in Long Island.
Out of curiosity, I asked them if the stores and shopping centers were packed with people as usual. To my surprise, the answer was “not really.”
I thought instantly about the growth of online shopping and companies like Amazon. Are we experiencing a monumental shift due to economic forces and technological innovation? Being my nerdy-Duke-student self, I decided to search for evidence as to whether or not what my parents had experienced last weekend (calm Black Friday crowds) was happening a macro level.
Going shopping in brick-and-mortar stores on Black Friday is supposed to be an American tradition, no? It’s actually similar to Thanksgiving in terms of cultural gravity. We still eat turkey even though there are so many other choices of foods we’d probably enjoy more. Yet, for the sake of tradition, we choose to suck it up and eat meat that’s dry and makes you tired. Similarly, even though we have smartphones, online delivery and more convenient methods of buying products, don’t we just go out to shop and spend money to experience the energy and feel-good atmosphere of the holiday season? Apparently, the latter tradition is waning.
According to Business Insider, Macy’s is closing 68 of its 880 store locations to restructure its business plan increasingly toward online retail. In fact, Macy’s response to new market trends reflects the beginning of challenges for department stores in this new age of technology. From 2005 to 2015, total U.S. Department stores sales have declined from $87 billion to $61 billion. This is equivalent to a decline from 3.6 percent to 1.9 percent of the retail market share. Through April of this year, the rate of closing retail locations more than doubled from the 2016 rate.
The eruption of online retail shopping was present on Black Friday as well. Adobe Insights reported that a record $5.03 billion was spent online by the end of Black Friday, which amounted to an increase of 17 percent from last year. To no one’s surprise, Amazon dominated the online marketplace, and claimed between 45 and 50 percent of all online Black Friday sales. Online sales throughout the holiday season are expected to rise 14 percent from last year all the way to $107.4 billion. Imagine all of the consumer spending we could have with tax cuts in place!
On the other hand, estimates from ShopperTalk, a data analytics company that measures the number of shoppers at stores, claimed that foot traffic decreased slightly compared to last year. People all across the internet posted photos of empty stores throughout the weekend. Deloitte’s annual survey predicts that for the first time ever, online sales will exceed in-store sales for the holiday season.
Has in-store shopping on Black Friday already reached its apex? With in-store shopping on the decline and online sales on the incline in conjunction with growth of online retailers like Amazon, the evidence indicates we’re experiencing a revolution in consumerism and business.
Brick-and-mortar retail stores should not be panicking. If large department stores want to survive and prosper, they need to innovate and restructure the ways they compete. This online revolution may be beneficial to productivity. Sales can still grow while store traffic decreases. Our free market has arrived to a point where a great portion of our shopping needs can be addressed in the comfort of our own homes. Perhaps the free market has evolved to such an extent that humans will need to keep pace with the economy by growing pointy fingers that are better designed to press buttons and type.
The malls of the future may have no stores. As retail department stores begin to close, landlords are already seeking to fill the empty space with churches, for-profit schools and even engineering facilities. Others in the real estate industry are converting shopping malls to restaurants, offices and housing.
Digital devices are quickly taking over and upending the current dynamics of how we interact with the world around us. Consequently, they are having a profound impact on economic activity and business. The exact outcomes are unknown, but nevertheless, inevitable. While frightening for some and exciting for others, the quickly changing American economy will only continue to influence our culture and daily lives.
Mitchell Siegel is a Trinity sophomore. His column, "truth be told," runs on alternate Wednesdays.
Get The Chronicle straight to your inbox
Signup for our weekly newsletter. Cancel at any time.
Mitchell Siegel is a Trinity sophomore. His column, "truth be told," runs on alternate Wednesdays.