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Whether they file or don't file is irrelevant.

usatoday.com/story/money/20…
You can't fix retail without solving the shared traffic model issue.

In other words, when Forever 21 goes bankrupt or closes stores, tell me who helps malls make up the difference in traffic lost (traffic that benefits everybody)??

You have to have an answer to that question.
All of this was predictable ... if you ran customer simulations you knew this was coming years ago.

The minute you convert a retail customer to an e-commerce customer, retail suffers. It's so simple.
I'd run these simulations eight or nine years ago .... and it was so easy to see. E-commerce would drain stores of traffic, Management would close stores in response, and the lack of shared traffic would hurt malls, causing more stores to close, accelerating the process.
The simulations showed that you'd trade a dollar of retail sales for something less in e-commerce.

However, in the "transition phase" customers spent more in the short-term, as always happens during channel shift. I was there for catalogs to e-commerce, I lived it.
It's the short-term gain that fools most of the pundits ... leading them to the omnichannel agenda that actually accelerates the problem by shifting even more business online.
Now the experts are telling you that there aren't channels, there's just "customers" ... and they're telling you that you have to embrace a "phygital" model.

This style of thinking accelerates the problem even more. You'll empty stores even faster creating a frictionless model.
Worse, when you empty the malls you starve e-commerce of their primary source of new customers (which come from stores).

This means that a few years after a store closes, e-commerce falters as well.

Go analyze the data and see the issue for yourself.
Google and Facebook cannot solve this problem.

Getting people in the stores solves this problem.
Somebody might ask, "hey smart guy, you keep pointing out the problems but you don't offer a solution ... how about offering a solution??"
The solution isn't omnichannel / phygital nonsense. It isn't digital. It isn't accepting returns from the competition.

The solution is getting real customers who really care about buying in a store to actually visit a store.

The solution requires a mindset change.
The solution means you have to quiet the voices in your head ... voices telling you to embrace technology that is designed to create a seamless experience (that ultimately benefits e-commerce).

There's a reason digital folks promote this agenda, and it is $$$.
The solution requires all of us to create a compelling reason for a customer to visit a store.

It's no different than an NFL or College Football game. Why do you attend when you could just sit at home and watch the game? Be honest ... why do you attend?
Why do you attend a concert and spend a hundred dollars when you could listen to the artist perform via Spotify?
Why do you eat at a restaurant and spend a hundred dollars when you could make a perfectly credible meal at home?
The same reasons you attend a concert, eat at a restaurant, or attend a sporting event are the reasons that you'll visit a store in the future.

You most certainly won't go to a store to thumb through a stack of Dockers ... that's not entertaining, is it?
In other words, there aren't any short-term solutions. None.

In the short-term, the old business model will unwind. And it will be painful.
But behind the scenes, retail is being reinvented as we speak. As has always been the case.

New brands are trying new things ... most of what they try won't work, but there will be successes and those successes will lead to a new business model.
You'll shop in the new retail environment of 2025 for the same reasons you attend a concert today, eat at a restaurant today, or attend a sporting event today.

Understanding "why" you do those things leads you to the solution, leads you to shape what retail looks like in 2025.
Retail today is like a General Manager inheriting an NFL team that just finished a 3-13 season.

What does the new GM do?

They spend 2-3 years rebuilding, often from scratch, slowly weeding through the old players and drafting new players.
And the rebuilding process is PAINFUL and doesn't always work (ask the Cleveland Browns, NY Jets, or Oakland Raiders).

But when it works (think LA Rams)?? You reinvent football ... or in our case, we'll reinvent retail.

It's coming.

It will happen.

Questions?
KH
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