Posted by News Express | 14 January 2020 | 292 times
Ron Johnson has been around the block a few times in retail. He has notched some wins (successful stint as Apple store chief working alongside Steve Jobs), and gotten a few black eyes (unsuccessful time as J.C. Penney’s CEO).
But he knows more than enough about the retail industry at this point in his long career to spot inflection points. Johnson says Amazon (AMZN) is pulling up to a crossroads after dominating retail this past decade.
“I think the next decade is tough for Amazon, they are on their heels,” Johnson told Yahoo Finance in an interview. “Amazon is an interesting place.”
Indeed they are, and it has nothing to do with government regulators starting to sniff around the online retailer’s business model pioneered by Trump foe Jeff Bezos. It has everything to do with how old school retailers are reinventing themselves — finally — to not only compete against Amazon, but be the first choice for consumers.
Take Yahoo Finance Company of the Year Target. The discounter has turned its store network into one of its biggest assets, unleashing a host of delivery options that are driving big-time sales gains and profits. Target’s stock price has skyrocketed over the past year because of that evolution.
Rival Walmart has done the same, in effect transforming physical stores into real-time distribution centers. Shareholders have rewarded its stock price, too.
These are mostly capabilities that Amazon didn’t have to deal with from rivals in the last decade. Now it has to, and is responding by spending billions on same-day delivery services in an effort to protect its turf. That will come at the expense of the profits Amazon investors have long enjoyed.
And old school retailers aren’t the only ones driving major change. Lululemon’s business is on fire amid a growing network of small stores that double as workout studios. Peloton is opening showrooms as it seeks to collect data on prospective consumers. The stores hold no inventory, just show pieces to show off to shoppers.
Canada Goose has reinvented the retail shopping model with its new stores. The locations carry next to no inventory, only showing off styles that could be delivered same-day. There is a giant ice box in the stores that help customers test out the arctic proof jackets.
In short, retail is evolving quickly. Amazon is still a force, but it’s fast realizing others are nipping at its heels. To Johnson’s point, Amazon’s next decade in retail is likely to be different...and perhaps not as generous to retailers as the last decade. (ABC News)
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