Tuesday, May 3, 2011

The Futue of Retail Is Delivery - Sears and K-Mart

Today Sears announced its first quarter outlook.   It's announcement illustrated that retailers that rely on brick-and-mortar sales are in trouble.

The key figures:
  • Same store brick-and-mortar sales - down 4.1%
  • Internet sold and delivered sales - up 22.4%
  • Overall US sales - down 3.6%

The impact of internet sales suggests that Sears gets 98% of its U.S. sales in retail stores.  Sears is nearly a pure brick-and-mortar retailer.  Unless it can improve its competitive position on the web and change its brick-and-mortar strategy to complement in-person sales strengths, it will have a real challenge to return to sales growth.

Sears's problems provides an example why companies that sell exclusively on the web now get 20% of all deliverable retail sales are growing rapidly, and those using the brick-and-mortar strategy have less promising futures.
Sears's first quarter outlook show the increasing increasing importance of parcel delivery services and e-commerce. The future of the United Parcel Service, FedEx and the United States Postal Service will increasingly be linked to how well they serve retailers selling services through broadcast, direct marketing, web-based and social media. Recent reports by the Inspector General of the Postal Service suggests that there may be a digital role within the postal ecosystem that could improve the efficacy of web and and mobile based communications for commerce that could improve the prospects for the parcel delivery industry. It is for this reason that an upcoming conference, Postal Vision 2020 will be bringing together some of the greatest minds in e-commerce, social media, digital and print communications to discuss the future of print and digital communications. The symposium to be held June 15, 2011 and the Marriott Chrystal Gateway Hotel in Arlington, VA. To learn more check out Postal Vision 2020 .

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