A really bad time to be boring · Being Remarkable · Reinventing Retail

Retail reality: It’s death in the middle

I first pointed to what I called “retail’s great bifurcation”literally two years ago today. Though it wasn’t the first time that I had observed what I saw as the impending collapse of the middle. I began writing and speaking about that during 2011.

As we emerged from the financial crisis it seemed clear to me that retail brands were faced with the proverbial fork in the road. A strategy of being just about everything to everybody–of selling average products to average people in an average experience–was becoming increasingly untenable. While it’s easy to credit the “Amazon effect,” or the overall rise of e-commerce, that’s only part of the story. The fact is many factors conspired to squeeze the middle, while, for the most part, the two ends of the spectrum continue to thrive.

For years now brands that execute well on price, dominant assortments, buying efficiency and convenience are winning. Amazon, Walmart, Best Buy, Home Depot, Costco and virtually all the off-price giants and dollar stores, are driving strong growth and profits. And–I hope you are sitting down for this–despite the silly retail apocalypse narrative, they are all opening stores–in some cases lots of them. Similarly, we find many success stories at the other end of the spectrum. Most established luxury brands are experiencing strong growth, as are higher-end specialty retailers who have a tight customer focus, offer a superior experience and provide a real emotional brand connection. Think Apple, Bonobos, Nordstrom, Sephora, Ulta, Warby Parker and many more. Somehow living in the age of Amazon and digital disruption has not come remotely close to creating an existential crisis for these retailers.

Of course, the story is very different for others in the great, mostly undifferentiated, wasteland of the middle. Most of the retailers that have recently made their way to the retail graveyard or find themselves at the precipice suffer from a decided lack of relevance and remarkability. They have decent prices, but not the best price. They have some service, but nothing to get excited about. Their product assortments and presentations are drowning in a sea of sameness. The overall experience is dull, dull, dull. It’s not surprising that a quick perusal of a store closing tracker features names like Sears, J.C. Penney, Macy’s and Radio Shack; brands that staked out the moderate part of the market long ago and have failed to innovate in any material way. Most of these companies now lack the financial resources, time and organizational DNA to affect the necessary transformations. This will end badly.

While it’s tempting to blame Amazon for the deep troubles faced by mid-priced department stores, the category has been on the decline for more than two decades. Studies also show that the majority of market share lost by these players in recent years has gone to the off-price sector. To be sure, Amazon is putting pressure on most sectors of retail. Further, the rise of digital shopping has created a radical transparency that places the customer firmly in charge. In many respects what was once scarce–reliable product information, lower prices, access to products from across the country (and around the world), rapid delivery–no longer is. No customer wants to be average and today, in most instances, no customer has to be. And, for those brands that have seriously invested in deep customer insight and committed to a “treat different customers differently” strategy, there is no place for unremarkable competitors to hide. Good enough no longer is.

The bifurcation of retail is only going to become more pronounced. The fork in the road is more and more obvious. The collapse of the middle will only get worse.

It turns out it’s really bad time to be boring.

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A version of this story appeared at Forbes, where I am a retail contributor. You can check out more of my posts and follow me here.  For information on keynote speaking and workshops please go here.

Being Remarkable · Innovation · Inspiration · Leadership

Stay. Stay. Stay.

The amygdala is sometimes known as the “lizard brain.” It’s more or less a holdover from prehistoric times and its role is to activate our primal survival instincts such as aggression and fear. When we are faced with a perceived threat, it can reflexively kick us into “fight or flight” mode. Sometimes–typically when we get overwhelmed and flooded with stress hormones–we can bounce back and forth from attacker to avoider, from villain to victim. Or we can shut down entirely.

At work, the lizard brain can keep us from trying new stuff despite knowing we need to innovate. It can cause us to push back hard on challengers to the status quo because we fear being wrong or looking stupid. Or we can just get stuck, paralyzed into inaction.

In personal relationships, those of us who fear intimacy can push away those whom we love, despite our desire to be more deeply connected. Or we can bolt for the door just as we get closer to what we so strongly desire.

The Resistance is real. So is self-sabotage. But as Pema Chodron reminds us, “fear is a natural reaction to moving closer to the truth.”

Clearly some situations are untenable and they deserve to be run from and put well behind us. Frankly, quitting is often under-rated.

Other circumstances require us to stand up and fight and say “enough is enough.” No one should endure tantrums or constant boundary violations or harassment or far worse.

Discerning the situations where we need to get in and rumble and get messy and walk through our fear is not easy. It takes real courage to remain in the arena when everything tells us to to flee. To engage when the fear comes up. To do the hard, uncomfortable work. To be neither victim, nor persecutor, nor rescuer, but an accountable adult, fully present, living in reality and owning our truth.

Our restlessness is part of the human condition. And the lizard brain can be easily activated–even more so if we have a history of trauma.

But like a dog being trained, we can learn to stay. Stay engaged. Stay focused. Stay patient. Stay accountable.

We can do the work.

The challenges are great, but so too can be the reward.

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Being Remarkable · Inspiration · Leadership

The way we vote

A lot of people will be going to the polls today.  But most won’t–and not because they aren’t holding elections in their community.

Voter turnout is ridiculously low in many parts of the country, particularly in local elections. And that means those that actually show up have disproportionate influence.

Of course we get to vote on lots of things each and every day by deciding what we give our time and attention to. And it’s easy to vote “no”.

It’s comfortable to play it safe. To hope someone else will do it. To stay in thought, rather than action. To ruminate on what could have been, or fantasize about what might be someday. To admire others good work from a distance. To be the critic, rather than the person in the arena. To tell ourselves that we will be ready to commit when various forces align that will make for the perfect moment to start. But we’re never ready.

The way we vote matters. And it turns out that in just about everything we are confronted with those that show up have disproportionate influence.

Being Remarkable · Reinventing Retail · Store closings

Department stores aren’t going away, but 3 big things still need to happen

It’s been a long, slow slide for department stores. Starting some two decades ago, the major chains began leaking share to the big-box, off-the-mall players. Just as that started to stabilize somewhat, Amazon and other e-commerce pure-plays began chipping away at the sector’s once dominant position in apparel, accessories and home products. Most recently, in addition to the ongoing threat from online shopping, off-price chains have benefitted from a growing legacy of major chain mediocrity.

Unsurprisingly, investors have treated the sector like the plague. The market values of Macy’s, J.C. Penney, Sears, Dillard’s and Kohl’s have all plummeted. Even Nordstrom, which has performed relatively well, has seen its market value halved in the past couple of years. Just this past week J.C. Penney saw its shares, which were already off some 80% since 2013, plunge further after a surprise earnings warning. In addition, Sycamore looks to be picking at the carcass of Bon-Ton Stores and Lord & Taylor is selling its iconic Manhattan flagship to WeWork. And on and on.

For many, this unrelenting parade of bad news leads them to believe that department stores are toast. But just as the retail apocalypse narrative is nonsense, so is the notion that department stores are going away. I am willing to go out on a limb to say that a decade from now there will still be hundreds of large, multi-category brick-and-mortar stores operating in the United States and throughout the world. But despite this conviction, things are virtually certain to get worse before they get better and three major things must happen before any sort of equilibrium can be reached and decent profits can return.

Major space rationalization/consolidation. The overall retail industry is still reeling from decades of overbuilding, as well as the abject failure of most department store anchors to innovate to stay remotely relevant and remarkable. While the idea that major chains can shrink to prosperity is fundamentally misguided, it’s clear that a) most chains still have too many stores, b) the stores they have are, on average, larger than they need and c) there is no compelling reason for Sears, Kmart, Bon-Ton (and perhaps a few others) to exist at all. Many dozens, if not hundreds, of locations are certain to be whacked after the holiday season. And despite the liquidation sales that will put pressure on earnings in the first half of the calendar year, there is actually a real chance for year-over-year margin improvement by the time the holiday season rolls around this time next year.

A true commitment to be more focused, more innovative and more remarkable. It turns out department stores, like every other struggling retail brand, picked a really bad time to be so boring. It turns out that deferred innovation is even more crippling than deferred maintenance. It turns out that trying to be everything to just about everybody means being mostly irrelevant to a lot of folks. Given the certain continuing contraction of the sector, the only hope for remaining brands is to gain significant amounts of market share. And that only happens to any material degree by embracing intense customer-centricity to become more relevant to a tighter customer set and by consistently executing a far more remarkable experience than the competition. Continued flogging of me-too products, one-size fits all advertising, boring presentation and chasing the promiscuous shopper through promotion on top of promotion won’t cut it. Period. Full stop. The hard part is that most of the flailing brands are woefully far behind, lack a culture of innovation and simply don’t have the cash to do what it will take to right the ship.

Amazon needs to place its bet. It’s clear that Amazon has its sights set on being a much bigger player in apparel, accessories and home products. And it’s hard to see how Amazon gets speed, adds the necessary volume and addresses the vexing returns/supply chain issues without a major physical presence in the moderate and higher-end softlines arena. For that reason, I’m also willing to go out on a limb and predict that Amazon will buy a major department store player in 2018. And just as its acquisition of Whole Foods is transformative for the grocery industry, so too will be a much deeper brick-and-mortar (and omnichannel) presence in the department store sector. In fact, it’s hard to underestimate how a big move by Amazon here will reshape just about every imaginable facet.

While 2017 has brought more than its fair share of department store news–and we’re hardly finished–I see 2018 as being chock-a-block with not only profound news but likely representing the year when the future of the sector will become far more clear. Stay tuned.

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A version of this story appeared at Forbes, where I am a retail contributor. You can check out more of my posts and follow me here

For information on speaking gigs please go here.

Being Remarkable · e-commerce · Strategy

Going private: Here comes Amazon’s next big wave of disruption and dismantling

While Amazon is often falsely blamed for all of retail’s woes, the “Amazon Effect” is both profound and well-documented. While the company’s overall market share is relatively low (under 5%), Amazon now accounts for nearly half of all e-commerce sales and its pricing and supply chain supremacy continues to put margin pressure across many categories of retail.

Yet, lost among the stories about the showdown between Amazon and Walmart or the impact of the Whole Foods acquisition or the company’s many stymied attempts to become a major fashion player is potentially an even bigger and more interesting narrative. What should be added to the list of things that keep both manufacturers and retailers up at night is Amazon’s rapidly evolving private brand strategy. The massive potential for a “go private” thrust to be another key component in what L2’s Scott Galloway has called Amazon’s systemic dismantling of retail and brands is huge.

Here’s why:

Private brands can have powerful consumer appeal. A well-executed private brand strategy allows for equal (or even better) quality products to be delivered at much lower prices. Store brands have moved well beyond the generic product days into being desired brands in their own right and have become significant lines of business for many retailers.

Private brands typically have greater margins. By controlling both the product design and supply chain–and avoiding the need for large marketing and trade allowance budgets–proprietary store brands can deliver a better price to the consumer and better gross margins for the retailer. Therefore the brand owner has a greater incentive to push its captive brands over national brands.

Amazon has already created a solid base of private brands. It turns out that Amazon already has a solid stable of proprietary brands. Some are more basic commodity items sold under the Amazon name. Some have their own identity, like Mama Bear and Happy Belly. Others tilt toward the more fashionable. With the Whole Foods acquisition, the company also controls the 365 Everyday Value brand which, rather unsurprisingly, is now available at Amazon. Recent reports suggest they are jumping into the athletic wear business.

Amazon’s private brands are on fire. While specific financial data is relatively sparse, most indications are that the company is thus far yielding strong performance with its own products. According to one report, many of these brands are experiencing hyper-growth.

The Amazon chokehold. Ponder for a moment the amount and quality of customer data Amazon can leverage to both design and target its own stable of higher margin products. Consider that more than 55% of all online product searches start at Amazon. Reflect on the reality that Alexa’s algorithms already give preference to Amazon’s private brands. Contemplate how easy it will be for Amazon to systematically design its website to feature the brands it wants to promote. Meditate on the freedom Amazon has to pursue the long game given its strong cash flow and Wall Street’s current willingness to value growth over profits.

Because of its sheer size, as well as the need to feed the growth beast, Amazon must both grab more market share in categories where it already has a material position, while also entering and penetrating significant new opportunity areas. At some point, Amazon will also have to demonstrate that it can make some decent money outside of its Amazon Web Services business. The opportunity in private brands serves both Amazon’s long-term revenue and margin objectives.

For the most part, Amazon’s private brand aspirations have operated under the radar. But from where I sit, it won’t be long before they reach critical mass in many key categories. And when they are ready to truly step on the gas–both from their organic efforts, as well as from what I believe will be at least one more major brick & mortar acquisition–another wave of brands (both wholesale and retail) will get caught in the wake.

For the competition, it’s time to be afraid. Very afraid.

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A version of this story appeared at Forbes, where I am a retail contributor. You can check out more of my posts and follow me here

For information on speaking gigs please go here.

Being Remarkable · Customer experience · Reinventing Retail

Flailing retailers need to learn to ‘sell the hole’

I cannot begin to tell you how many times executives at various retailers have said to me that “it’s all about the product.” Earlier in my career, when someone would spout this alleged truism, my somewhat smug thought would be that I could easily come up with many examples where that was demonstrably false. In more recent years, I’ve come to believe that it is precisely retailers’ false clinging to this notion that helps explain why so many find themselves standing at the precipice.

We can argue at length about how important product features and benefits are to consumers’ purchase decisions and long-term loyalty. And clearly that varies by industry segment and customer type. Yet by now it should be obvious that in the vast majority of cases good product is necessary, but hardly sufficient, in determining retail success. It should be clear that people buy the story before they buy the product.

Stated differently, when a consumer buys a drill, it’s because they want the hole. When someone pays $4 for a bottle of water they are mostly paying for how that water makes them feel, not for the better taste. If you think Apple products are always objectively the best functioning, you are only kidding yourself. And if you believe that $200 jar of eye cream works any better that the stuff you can get at Walgreen’s, prepare to be disappointed. Second-best and just plain old mediocre products win all the time. It’s clearly not only about the product; it’s about the solution, the feeling, what our purchase says about us. As noted retail strategist Bill Clinton might say: It’s the experience, stupid!

It’s not all that difficult to understand how traditional retailers became overly product-centric. Take a look at the leadership at most retailers and most came up through the merchant ranks. While the era of the “merchant prince” is on the wane, there are still an awful lot of CEOs who are long on merchandising skills and short on customer experience and digital bona fides. And that mindset permeates the cultures of many struggling brands. It needs to be blown up.

Go through the list of bankrupt or severely struggling retailers and it should be readily apparent that while there may have been merchandising issues that contributed to their problems, their big issues emanate from a failure to deeply understand shifting customer preferences and to respond to those changes. As a result they ended up with a largely irrelevant and utterly unremarkable customer experience. And, as it turns out, they picked a really bad time to be so boring.

If flailing retailers — be they Toys ‘R’ Us, JCPenney, Macy’s or dozens of others — are to survive, much less thrive, the answer isn’t going to be found in shrinking to prosperity, trying to out-Amazon Amazon or being hyper-focused on improving their product assortments.

The answer is going to be found in crafting a truly remarkable and relevant customer experience that is far more about the hole than the drill.

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A version of this story appeared at Forbes, where I am a retail contributor. You can check out more of my posts and follow me here

For information on speaking gigs please go here.

Being Remarkable · Digital · Omni-channel

The End Of E-Commerce? These Days, It’s All Just Commerce

Given the continued rapid growth of online shopping, it might seem crazy to suggest that the era of e-commerce is coming to an end. Yet while we are used to talking about e-commerce as a separate thing — and isolating statistics for digital transactions versus brick-and-mortar same-store sales — it’s increasingly clear that these are becoming distinctions without much of a difference. For consumers, it’s simply “commerce,” and retailers that want to thrive, or survive, need to fully embrace a one brand, many channels strategy.

I recently attended shop.org, the annual conference historically focused on digital commerce. What struck me most (beyond the dwindling attendance) was that speakers mostly ignored online shopping as a stand-alone concept. Instead, many emphasized the importance of brick-and-mortar stores in delivering a remarkable customer experience. Moreover, the majority of technology providers in the expo offered solutions that were very much anchored in online/offline integration or leverage, not e-commerce optimization, as was true in the past. Rather than buying into the retail apocalypse narrative and seeing brick-and-mortar stores as liabilities, most were clearly in the camp of believing that stores were (wait for it) assets. Physical retail might be different, but it clearly is not dead.

Notably, Mark Lore from Walmart/Jet spoke of the need for retailers to be channel agnostic and highlighted how Walmart’s stores give the brand a distinct advantage. TechStyle CEO Adam Goldenberg showcased statistics on how Fabletic’s overall brand performance has been enhanced through the opening of stores and on how the merging of cross-channel data gives them an edge. Kohl’s spoke of the role of mobile as a constant companion in the shopper’s journey from online to offline (and vice versa). While using somewhat different language, numerous other speakers acknowledged that customers shop everywhere and the best retailers need to meet them where they are. Clearly, more and more, it’s just commerce now.

Of course, the lines have been blurring for years, and study after study shows that a well-integrated shopping experience across channels (what some call “omni-channel” and what I prefer to call “harmonized retail”) is what customers desire and what often determines a brand’s ultimate success. The increasing investments in physical stores byAmazon and other digitally native brands serve to underscore this growing reality. Those of us who are familiar with retailers’ customer data know that, typically, a brand’s best customers are those who shop and/or are heavily influenced in both digital and physical channels. We also know that opening stores drives increases in e-commerce in that store’s trade area, just as closing a store often leads to dramatic declines in online shopping. It’s all just commerce.

This realization does not negate the fact that a meaningful percentage of shopping occurs in a purely digital fashion (particularly downloading books, music and games). It does not minimize that Amazon has achieved a total share of retail rapidly approaching 5% almost entirely without a physical presence. But as we move ahead, it’s important to realize the significant contributions to what we label “e-commerce” that are derived from traditional retailers’ online divisions. It’s important to recognize that Amazon will struggle to maintain outsized growth without deepening its investment in brick and mortar. It’s critical to grasp that digitally influenced physical-stores sales far exceed sales rung up online.

And ultimately it’s essential to realize that it is rarely an online-vs.-offline battle, but a struggle that is won when we accept that it’s all just commerce and strive to bring the best of offline and online together on behalf of the customer.

A version of this story appeared at Forbes, where I am a retail contributor. You can check out more of my posts and follow me here

For information on speaking gigs please go here.

Being Remarkable · Customer Insight · Reinventing Retail

Discount Nation, Promiscuous Shoppers And The Sucker Price

Early in 2011, I first wrote about what I called “Discount Nation.” Having worked at Sears earlier in my career I was quite familiar with highly promotional retail. But what I was noticing was the ever growing intensity of discounting. Among traditional retailers the degree and frequency of deals was escalating. More brands were layering on loyalty programs or additional percents-off if you used their private label credit card. Free shipping was virtually ubiquitous during the 2010 holiday season. Newer business models, like the growing flash-sales segment, were trumpeting 40-60% off as the core element of their value proposition.

Since then it’s only gotten worse. The fastest growing segments of physical retail are off-price and dollar stores. Free shipping of online orders, once reserved for special promotional periods and often limited to higher order values, is fast becoming a basic consumer expectation. Minimum order sizes are falling and free returns & exchanges are becoming increasingly common. Rich discounts to incentivize trial now range from the sublime to the ridiculous (I’m looking at you Blue Apron). At any given time, it seems like virtually everything is on sale.

It’s easy to credit the transparency of the internet, cite the rise of digitally-native disruptive business models or simply blame the Amazon Effect for the erosion of any semblance of price integrity. And to be sure these are all contributors. But the reality is that it’s been a decades long process of retailers turning most of us into promiscuous shoppers. Regular price did not become the “sucker price” just in the last few years.

Some of this was inevitable; yet much is self-inflicted. Retailers could have chosen to focus on deep customer insight to deliver more relevant personalization. They could have invested in product innovation. They could have seen their physical stores as assets to leverage in creating a more harmonious and remarkable customer experience, rather than as liabilities to cost reduce and shutter.

We know that the relentless downward pressure on pricing only squeezes margins for all but the most cost efficient. As a result, many retailers find themselves standing at a precipice. The rather rosy forecasts for holiday spending are small comfort as it is clear that profits are another matter entirely and the harsh reality is that the future will not be evenly distributed. Living in Discount Nation may be great for consumers but it is disastrous for all too many retail brands that have failed to reinvent themselves and will be lucky to limp their way into 2018.

While it is too late for some, many brands still have a choice: engage in a discounting fueled race to the bottom or seek to do what is unique, intensely customer relevant and truly remarkable, where price is not the determining factor in the customer’s decision.

As they saying goes, choose wisely. And remember to hurry.

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A version of this story appeared at Forbes, where I am a retail contributor. You can check out more of my posts and follow me here

For information on speaking gigs please go here.

Being Remarkable · Small is the new black

Small is the new black: Nordstrom ‘micro-concept’ edition

Last week Nordstrom announced it will open its first “Nordstrom Local” in West Hollywood, California. The new venture is noteworthy on several dimensions. First, at 3,000 square feet, the pilot concept is dramatically smaller than a typical Nordstrom full-line department store. Second, it won’t stock any of the items that Nordy’s is best known for, such as shoes, clothing, cosmetics and accessories. Third, the focus will be on services: tailoring, manicures, style advice and cocktails.

Nordstrom joins a growing number of brands shrinking their footprints and once online only brands delving into the physical realm with small box stores. Of course, the reasons for the big guys going small and the little online brands getting into brick and mortar vary. The downsizing of traditional formats is often driven by a typically vain attempt to optimize productivity. With more business being done online the thought is that less square footage is needed to take care of the customer. The problem is that shrinking to prosperity rarely works.

Another big driver of smaller formats being promulgated by major retailers is the desire to get closer to the customer. Smaller versions of traditional format stores like Target’s urban concept allow the company to open many new more convenient locations at acceptable economics.

Most interesting–and probably the leading indicator of what’s to come–are the new brick-and-mortar “micro-concepts” that are designed from a customer point of view and rooted in the understanding of the interplay of online and offline. In announcing the Nordstrom Local test Nordstrom’s co-president Eric Nordstrom says it best: “There aren’t store customers or online customers—there are just customers who are more empowered than ever to shop on their terms.” What Nordstrom has understood for a long time–and what helps explain much of their success during the past decade–is that physical stores drive online and online drives stores. Ultimately, the retail brands that win create a highly remarkable and relevant experience that meets the customer where they are.

Digitally native brands that move into physical retail apply this thinking as well. While brands such as Bonobos, Warby Parker and many others initially believed they could build successful enterprises without pesky brick-and-mortar locations, they’ve come to realize that not only do many customers prefer to shop in actual stores, but also that physical locations bring many important economic advantages. The beauty of these brands starting with a blank sheet of paper when it comes to designing stores is that they can pick the best locations and create a highly experiential and remarkable shopping experience that leverages the best of online and offline into a more relevant and harmonious whole.

Clearly, the jury is still out on most of what’s in market today. Whether the movement of pure-play brands into physical retail will pan out remains to be seen as virtually all of these brands are hemorrhaging cash and reports of high sales productivity out of a few choice locations do not necessarily indicate profitable scalability. Nascent micro-concepts like Bodega are far from proven winners. And with Nordstrom Local it will clearly take some time to know whether it turns out to be a noble experiment or something that can be rolled out to a substantial number of locations.

While we are early in the move to micro-concepts I expect to see three things happen over the next year or two. First, is a dramatic uptick in new concept testing from both start-ups and traditional players. Small enables greater customer reach. Small makes more interesting site locations possible. Small lowers breakeven sales volumes. Small blends the best of online and offline. Second, will be the dramatic expansion of a few powerful formats where dozens, if not hundreds, of locations can be opened. Lastly, we are also likely to see some big flame-outs, particularly among the online only players that never had a viable business model in the first place.

Regardless of how this all ultimately plays out, from where I sit, Nordstrom is to be applauded for their willingness to take risks and to experiment. Many more retailers would be wise to follow their example.

Nordstrom Local Storefront

A version of this story appeared at Forbes, where I am a retail contributor. You can check out more of my posts and follow me here

For information on speaking gigs please go here.

Being Remarkable · Reinventing Retail · Store closings

The Retail Apocalypse And The Urgent Quest For Remarkable

Some love the “retail apocalypse” narrative. It’s great clickbait, makes for captivating keynote speeches and gives consultants a hook to peddle complicated strategic frameworks. Alas, it’s mostly nonsense. Physical retail is definitely different, but it’s far from dead. The fact is plenty of new stores are opening, many traditional retailers and — I hope you are sitting down — even quite a few malls are doing great. Brick-and-mortar retail sales are likely to be up this year, just as they were last year.

Some retailers love hearing this alternative narrative because they think it means they will be okay, that they don’t have to change, that there is some storm they just have to ride out. Unfortunately, that is not only nonsense, it is dangerous nonsense. While physical retail is not dead, virtually every aspect of retail is changing dramatically, as this excellent pieceby Doug Stephens points out. While I believe Doug overstates a few things, his underlying premise is on the money. Almost everything has to change and the key thing to understand is that the future of retail will not be evenly distributed. Stated simply: yes, some brands will do well. But many others will struggle mightily, others will be eviscerated and quite a few are dead already, they just don’t know it.

Physical retail is not going away but unremarkable retail is getting hammered. The brands that relied on good enough are learning the hard way that good enough no longer is. The mediocre brands that were protected by scarcity of information, distribution and access are getting blown apart as the customer can now get the same product anytime, anywhere, anyway — and often for less money. The brands that tried to stake out a place in the vast wasteland between cheap and special are losing as retail becomes more bifurcated and it’s increasingly clear that it’s death in the middle.

By now, a few things should be abundantly clear:

Just because physical retail isn’t dead doesn’t mean you don’t have to change.

On average, more than 80% of retail will still be done in physical stores in 2025. Unfortunately, you can’t pay your bills with averages and your mileage will vary. The way the migration of sales away from physical stores to online will affect your competitive situation and marginal economics can have devastating consequences. Even small shifts can require the need for radical reinvention.

Stop blaming Amazon.

hile there is no question of Amazon’s dramatic and growing impact upon the retail ecosystem, most of the retail industry’s problems today have nothing to do with Amazon. Overbuilding, excessive discounting, boring product, unremarkable experiences and a fundamental lack of innovation are the main reasons that most retailers are struggling today.

It’s not just about e-commerce. 

The most disruptive force in retail is not e-commerce but the fact that most customer journeys start in a digital channel. In fact, digitally-influenced brick-and-mortar sales dwarf online sales.

You can’t out-Amazon Amazon. 

Pop quiz: Are you Walmart or Target? No? Okay, then stop trying to out-price, out-assort and out-convenience Amazon. To paraphrase Seth Godin: the problem with a race to the bottom is you might win.

Choose remarkable. 

Unless you are on the short list of brands that can be just about everything to everybody (and actually make money) your task is to get hyperfocused on a set of consumers for whom you can be intensely relevant and remarkable at scale. That likely means being far more experiential and blending the best of online and offline in a compelling and harmonized way.

Be prepared to blow stuff up. 

Remarkable is easier said than done. And most retailers suffer from bringing a knife to a gun fight when it comes to innovation. Much of what got us any level of success in the past isn’t going to work in the age of digital disruption. New thinking, new processes, new technology, new metrics and new people are table-stakes on the path to retail reinvention.

Hurry.

As the Chinese proverbs says, “the best time to plant a tree was 20 years ago. The second best time is now.” Chances are you’re already behind and it’s far later than you think. The only choice then is to get started. Now. And go fast. Fail fast. Rinse and repeat.

The big problem is we think we have time.

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A version of this story appeared at Forbes, where I am a retail contributor. You can check out more of my posts and follow me here

For information on speaking gigs please go here.