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Did you hear the one about the retail apocalypse? Just like every snowstorm seems to be a snowpocalypse or bombogenic cyclone these days, every store closure story must be part of a retail apocalypse. Right?
Foot Locker is the latest to be shoved into the pile of store closures that have been shoveled into the apocalyptic angel of death. 110 store closures is a lot.
Was it the retail industry? There are more store openings than closings in 2017. Retail industry growth rates are steady at over 4% CAGR. Tier-A mall vacancies are at a decade-long low.
Must be the shift to eCommerce? eCommerce is still less than 10% of consumer spending and sneakers are a lagging category.
Maybe people have just stopped buying sneakers? Actually, sneakers are hot, just ask Flight Club and Goat, the $1b secondary market, or any number of designers. In fact, the sneaker industry grew a whopping 12% YoY!!! 7% per year the last 2 years, outpacing the general retail industry (Source: Statistica 2018)
The Answer is D, None of the above.
Foot Locker is struggling because… well, when’s the last time you walked into a Foot Locker? I did last December in looking for basketball shoes. I’m getting on in age to be playing basketball (although the team I captain has won our NY Urban Professional League 3 out of the last 5 seasons) and so I like to have some ankle support but hate the bulky sneaks that come with it. So after checking out the Nike store (#AwesomeRetail), I went to Foot Locker.
What I found was a pathetic collection of shoes arranged by brand (rather than sport). I had to go to 4 sections of the store to check out Nike, Adidas, Under Armour and Reebok. There were no explanations of the shoe. No product information to explore. No media. No flash. No excitement. I asked a question of the sales associate, and he told me their selection was limited. He recommended something that wasn’t going to work. Nice gentleman, but I think he was as disappointed in not being able to solve a simple request as I was. I got out of there as fast as I could. I’ll likely never go back.
To all the retailers out there who think they can get by just by offering a controlled and undifferentiated selection of goods in the same old ways, take notice. The shopper has more options than ever. You need to give a reason to stop by.
In sports, with every shoe seemingly sponsored by an athlete, it's criminal not to bring all that digital media and excitement in store. This is sports after all. Nike plugged into the aspirational emotional connection of athletics and in turn its stars, the athletes. Foot Locker felt like a chore. No media. No excitement. No joy... No customer.
Final verdict is that this is a self-inflicted wound. So please stop calling this a case of the retail apocalypse and let's focus together on making brick-and-mortar retail engaging, interesting and fun.