Well, another large retailer is biting the dust - Borders. I liked Borders but always wondered how they were making money. Normally, people go there to look at books as if they are in the library and not buy anything or go to coffee shop and buy a $2 latte and sit on their laptops cruising Facebook for many hours. It is no wonder they were losing money and are now going out of business. But there is a larger issue here where Borders did not change with the times and customer focus. For the past few years, just as newspapers started going away, people started moving to electronic readers and mobile devices to do their day-to-day communication and reading. Barnes & Noble has the Nook, Amazon has the Kindle, and many others are being promoted. Borders also did not do a good job promoting their online presence. Simply put, if you don't shift your focus to your company's online presence, you will go out of business. Case in point, Circuit City, Linens n Things and soon Toys R Us. You didn't hear that from me, but it is my pick for the next brick and mortar retailer to go out of business.
Today's customers buying habits are online case in point. Online sales at a company I am affiliated with has gone up over 30% in the past year while the typical brick and mortar retailer had same store sales growth between -5% - 5%. Social shopping is the wave of the future, matching product to people and people to product and there is no other way to do that than online shopping. A lot of retailers are now offering free shipping and online deals only since they do not need to distribute a product to a store and pay for shelf life and most of all, employees. I recently bought the book, Social Boom from Jeffrey Gitomer on my portal for $14.50 with free shipping. Just for the sake of it, I went to the local Barnes and Noble to see what is would cost. Try $22.99 with tax. I just booked a trip to the Cape through my online travel site and got an incredible deal at a great hotel/resort for a third of the price. Where? Online! So, why would someone go to a brick and mortar store? I'll admit, I do not buy clothes online or anything to do with the look and feel of my home (pictures, lights etc.), but in reality the demise of the brick and mortar is here. Your local mall may become more of an entertainment destination with theatres, restaurants, entertainment centers with a few clothes stores thrown in.
In closing, I feel for the 11,000+ people losing their jobs at Borders but we are in a different world today. Companies need to keep up with the times in the information and mobile age or they become a Borders.
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