Is retail dying? | CNBC Explains


There’s nothing quite like the
adrenaline rush of a shopping spree. But for many of us, that no longer
means walking around shopping malls. It means shopping online. That’s one reason why experts are saying we’re
in the beginning stages of a retail apocalypse. But are we? You’ve probably heard about the challenges
brick and mortar stores are facing like Toys R Us, which is closing about
900 of its stores in the U.S. and U.K. And there’s American retail icon Sears. It pioneered ordering by catalogue and
was seen as the Amazon of its time. Sears had survived for 132 years before it filed for
bankruptcy in 2018, closing more than 100 stores. It’s not just a few big retailers. In just three years we’ve seen a
wave of retailers go bankrupt. And in 2017, retail store closures in
the United States hit a record high. But it’s not just the United States. Some places like Hong Kong, Singapore and
Britain have also been hit by slow retail sales. Almost 6,000 stores closed in Britain
last year – that’s 16 stores a day. Those figures may sound like doomsday
for retailers, but don’t write them off yet. There’s a silver lining – people
love online shopping. This year, Cyber Monday became the
largest online shopping day in U.S history, with online sales reaching $7.9 billion in one day,
while shoppers spent $6.2 billion on Black Friday. Still, those figures were eclipsed by those
of a one-day shopping event in China. Alibaba’s Singles Day, which falls on November
11, is China’s biggest shopping event. This year, it made a staggering
$30.8 billion in 24 hours. China is the largest e-commerce
market in the world. The U.S. comes in at number two and the rest of the
world makes up about a third of global online sales. But how large is the e-commerce
market exactly? Well, for all of 2017, American consumers
spent a whopping $453 billion online. That sounds like a lot, but Chinese consumers spent
more than twice of that, totalling more than $1 trillion. The spectacular e-commerce figures are the reason
why many think physical retail is dying out. But let’s take a closer look at
the story behind the numbers. Online retail sales have been growing as a proportion
of total sales in China, as well as in the United States. Globally, there’s a huge appetite for
shopping with the click of your mouse. Online sales in Europe are growing 10
times faster than brick and mortar retail, while Southeast Asia’s e-commerce growth is
skyrocketing, doubling from 2017 to 2018. But here’s cause for pause. The explosive growth of online sales is moderating in
China, while it’s keeping steady in the United States. So we may hear about big household
names closing a large number of stores, but overall, retail sales in the United States
and China continue to grow steadily. Here’s another interesting trend. Online retailers are going
from clicks to bricks. Amazon, for instance, has
opened about 20 bookstores, at least six Amazon Go convenience
stores, as well as its 4-star store. You guessed it – it’s a store that only stocks products
rated four stars and above on the Amazon website. Alibaba is China’s answer to Amazon, and it
owns Taobao, China’s largest shopping website. I’m here at Alibaba’s first
Taobao store in Singapore. Taobao is known for its enormous catalog, selling
pretty much anything you could possibly imagine. But its store in Singapore carries only a
selection of some of its coolest items. Would you like a chicken wing pillow? Well you can’t quite bring it home, but you
can scan the QR code and order it online. At least you know exactly
what you’re getting. Alibaba is keen on integrating
online and offline retail. To drive up hype for Singles Day, it got 200,000
stores across China to participate. Shoppers could try on make-up testing mirrors
and get freebies through their mobile phones. Its biggest bet on physical
at the moment? That would be its Hema supermarkets,
of which there are about 60 in China. Shoppers can go to Hema to
get seafood served by robots, or they can order at Hema online and
get groceries delivered in 30 minutes. Online retailers seem to be absolutely
pummelling the competition. So why are Alibaba and Amazon
bothering to open physical stores? First of all, while sales from their brick and mortar stores
may not quite be as mind-boggling as their online figures, there is evidence that shoppers who buy in-store
end up purchasing more from their online stores. And here’s what’s even
more valuable – the data. Opening physical stores provides tech giants with
even more data about shopping behavior, likely helping Alibaba and Amazon get even better at making
irresistible offers to both online and offline shoppers. Mall operators and more traditional retailers
also want to get in on the action. Asian real estate company Capitaland
brought in Taobao for its mall in Singapore, and it will also open the country’s
first online-and-offline mall, which will include robots, automation
and facial recognition technology. Despite their love for online shopping, many
customers still want to try on products in store. More importantly, they want to buy. So it’s up to retailers if they want to bring on
the retail revolution, or face the apocalypse. Hi everyone, it’s Xin En! Thanks for watching. If you want to check out more of our CNBC
videos, click here. As usual, please feel free to leave any future
suggestions for videos in our comments section. That’s all for now, don’t forget to subscribe,
see you next time!

, , , , , , , , , , , , , , , , , , , , , ,

Post navigation

100 thoughts on “Is retail dying? | CNBC Explains

  1. REAL reasons retailing is going online:

    1. less ppl has cars these days
    2. piss poor customer service to the point that customers do their jobs for them
    3. you don't have to go to 12 store just to not find the product you could find in 5 minutes on google
    4. less free time means less time to go shopping
    5. global poverty, no one has money to spend

  2. 432B is more than the GDP of our entire country. The gdp her is 249B for 170M people. They should not exploit us by paying $0.5/ hour. It should be $4/ hour.

  3. Isn't chins has bigger population than us? They even buy grapes online. 10 years from now, picture that are no stores, no mails, restaurant foods are all delivery, self driving cars …. No to mention people can't make enough money cuz only 40% jobs remain will have to live underground. That's not a wifi movie, it is future.

  4. Did she say at 21 seconds
    "Challenges brick and mortar stores are facing like toys r us ? "
    Toys r us is not a brick and mortar store – face palm !!!

  5. Clothing stores should not die because I am tired of returning my clothing because it doesn't fit.

    I know what size to buy but apparently some clothing I have to get a size up or down.

  6. It's true that if e-commerce are thriving, then that means transportations are thriving too, since they have to be sent via air or land or ship. If transportation are thriving, then mechanic must be valuable, and whoever selling transportations' spareparts like car or ship or plane must be thriving.
    If that's true, employees will change their job into self-employed, or working with travelling or transportation or technology industries.
    But there's no point of selling something without creating something : clothes and house parts. Designer are needed as much as mechanic. Self-farmer are priority too. Water is the most important thing as food. Knowledge like geography, science, biology, anything that makes natural resouce can be converted into money and anything that converted into natural resources.
    There are many ways to work things out, as long as we can still thinking solution.

  7. Honestly if physical retail was cheaper than online, not price matching or anything legit cheaper, I'd buy from them. I just go to stores to see the product test it out or something then see if it's cheaper on Amazon. 99.9% of the time it's cheaper so I just order it on Amazon there in the store.

  8. Yeah, just ignore the fact that Amazon is a complete monopoly, and that they buy out any and all competition, so there won't be any, and they can be a monopoly. And Trump is letting this happen.

  9. Not exactly, but it is changing into having websites open stores which is explained in the video and having the small businesses come back each with their own site or app.

  10. Online shopping didn't kill retail. Stores that sucked killed themselves. You know why people stopped shopping at Sears?

    Because Sears sucks.

  11. Those days: drive to store, try on the clothes and buy what you need, wear them
    Today: login, look for pictures , buy a pile, track shipment, try them on , return the fails , track returns, call support, wait for refunds, keep the receipt just in case and then wear what you have left. Then you brag about buying it online.

  12. We are at peak Amazon. Because they now charge tax and shipping and shipping times are increasingly slow. Plus Amazon has a bad image like Wal-Mart. There will be a slowdown on Amazon sales in the coming years.

  13. Given the option, people prefer the cheaper price and convenience of buying online, for most products. There's no reason to pay for all the costs associated with bricks and mortar like wages, rent, utilities, theft.

  14. i've worked in the store fixtures industry for over 15 years; and I can tell you, retail stores are dying – there aren't that many malls being built these days because of online retail – folks don't go to physical stores to buy stuff like they used to – hence, only a minute number of brick-and-mortar stores are being built or renovated. Most have chosen to close for good. Don't believe me ? Check out the "Dead Mall Series" on YouTube.

  15. Virtual Retailing will replace all malls and groceries they will closed 3 years from Now also delivery service is replaced by 5g Ai Drone delivery Cashless will implemented using 666 RFID also Sim card also vanished because future Smartphone can unlock or lock his Internet connection using 666 RFID NO DEVIL'S MARK NO FRIENDS you cannot live without friends.

  16. Personally, in an emergency I don't know about ordering stuff online.  They may be able to do it but I don't want to rely on that.  I am not sure about if I want to rely on buying stuff online in an Emmergency because I don't know if it will work.

  17. As much as all these 'experts' spouts retail is dying the fact is that it isn't. Amazon might be for some but many still need retail stores especially clothing/apparel. You just want to try it on. Stores that innovate survive. Sears fail to change with the trend therefore they lose.

  18. Superior customer service is the most significant reason to shop and buy at brick&morter stores.
    And the premium price better be worth going out to them.
    Otherwise, forget it.

  19. Sales people in stores annoy me, let me just shop without you asking me 100 questions. If i have a question, i will come to you.

  20. @CNBC, get a native speaker of English next time so we dont have to stress ourselves to understand what is being said. For evidence of my claims, see 5:53 ("Facial Racanickshion")

  21. Sky.com is the Global Internet are more for between countries n countries Trading, so no worries, others website n retail will not die. Miem.com are more for Middle East market n North Korea n all those countries then has not open up their markets, so no conflict.

  22. I think Alibaba or Amazon is just openning a few stores as " experience store" , not exactly retail and also for product that you haven't bought before, if you are looking at retail in the most classical sense, it is dying, think about it, if you know exactly what you need, ie. a razor or an xbox , would you go to a store or would you just buy it online?

  23. Lazy Americans please go to the malls but not online😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡😡

  24. Please keep a british person. They just sound so much more professional. Listening to her it seems like you kept her just to show you care about diversity even though it makes your show much poorer in taste.

  25. Shopping in physical stores will always be enjoyable and have a place, the issue is that stores can no longer just have bland, boring store with terrible stock and do well anymore, now they actually have to put effort into their stores. Just think about it, many stores still pretty much looked like the stores did in the 50s.

  26. i hate to break this to amazon, only selling 4 stars or greater is going to encourage fake reviewers on bad products like iphones, what they should do is has star rating labels directly on the price tags

  27. A very poor report, keeps saying don't rule out bricks and mortar then goes on to give more statistics for online shopping? three times…then I ditched the video
    Did any one edit this??

  28. If you really think about it. Amazon doesn't create products. They are really the us postal service. They ship stuff people bought from them..that they bought at a cheaper rate. It's really brilliant.

  29. Truth: U.S. online sales only make up 12% of all retail sales.

    Media: ONLINE IS THE MAJORITY OF SALES AND KILLING BRICK-AND-MORTAR, BECAUSE NO ONE SHOPS IN STORES ANYMORE!!

  30. Has anyone thought far enough ahead and wondered.. who will have money to buy things online when there are no more jobs for humans or brick and mortar stores.

  31. The disadvantage of online is that it is not the product the you bought from what you have see on the site. sometimes, you get scammed of their products because instead of buying the quality online, the product delivered is cheap or have damages

Leave a Reply

Your email address will not be published. Required fields are marked *