Brick-and-mortar stores taking a hit despite record holiday spending
by Barnini Chakraborty, Senior Investigations Reporter
December 09, 2023 05:00 AM
Holiday shoppers are expected to drop more than $960 billion on gifts, foods, and decorations this year, but the spending sprees won't necessarily translate to big bucks for traditional brick-and-mortar stores.
The overall strength of consumer spending, which hit record levels in November and the first half of December, is obscuring how trends in retail have shifted over time, creating opportunities for online stores and retail behemoths like Amazon but also pushing out physical stores and small businesses.
And while the pandemic accelerated the shift from traditional stores to online marketplaces, a growing number of consumers seem to prefer the method, a change that has been more than two decades in the making.
"Online sales have dramatically reshaped the retail industry since the turn of the millennium," Upgraded Points founder and CEO Alex Miller said. "In the late 1990s and early 2000s, startups like Amazon and eBay led the charge into e-commerce, and their successes led established retail chains to make online shopping a core component of their businesses. From 2000 to 2019, e-commerce grew from 0.9% of all retail sales to 10.6%. And with many physical retail stores closing or experiencing lower traffic in the wake of COVID-19, online sales jumped again to 14.6% in 2020 and have not fallen off since."
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