The Brick-and-Mortar Retail Revolution

Last month, Amazon announced that its Prime membership has exceeded 100 million subscribers worldwide. What once was just a website for selling books is now the world’s biggest and most influential retailer. However, the ubiquity of Prime has made it such that most of this retail happens online.

What is to become of the brick-and-mortar retail store fighting back against the one of the world’s most powerful companies?

Small business owners all over the world – and across category verticals – are grappling with this very question. After all, Amazon offers quality products, competitive pricing, seemingly endless variety, and ultra-fast shipping. What can stores provide that Amazon doesn’t?

Societal shifts like this tend to force change. After all, businesses have only two options: adapt or go extinct. As a result, we’re seeing the brick-and-mortal retail store change from a place where solely goods are sold to a place where consumers can have an experience that e-retailers cannot provide. Let’s take a look at some recent examples of this retail revolution.

Tsutaya

Tsutaya is a bookstore chain in Japan that isn’t afraid to think outside the box. While each of the stores has its own special twist, the company recently opened its most unique store yet: the Tsutaya Book Apartment in Shinjuku, Tokyo. As the name suggests, it’s much more than a bookstore – it’s also an office and a hotel.

Knowing that the Shinjuku district of Tokyo is overcrowded, Tsutaya wanted to create a space where visitors can relax and work in peace. Those who desire a private workspace can pay an hourly rate to reserve their spot and those who need a place to stay overnight can do just that. Meanwhile, the store also houses a Starbucks café, gives guests access to a printer and stationery supplies, and has lockers, bathrooms, and showers for those who wish to stick around longer.

The brilliance of it all? Not only does Tsutaya address a pain point for visitors of Shinjuku, giving them a place to unwind, freshen up, or do work in a crowded area of one of the world’s biggest cities, but it also creates additional revenue streams for a business that was initially built around books. Amazon can undercut Tsutaya’s book prices, but this experience is one-of-a-kind.

Sports Direct

E-commerce has put a dent in brick-and-mortar retail efforts for many companies, and clothing brands are no exception. Sports Direct, an activewear retailer in the UK, saw this and decided to change up its retail strategy. Partnering with video game company Game Digital, Sports Direct stores no longer offer just clothing – they now have pay-to-play video game concessions within stores, too. For £7 an hour, gamers can play in the “Belong” eSports arenas within Sports Direct stores.

This move marks an effort to capitalize on the growing overlap between traditional sports and eSports, a rapidly-growing industry that continues to outpace global revenue expectations. The results? By creating this “shoppertainment” experience for consumers, Sports Direct and Game Digital have both rejuvenated stagnant businesses. The proof is in the pudding, as revenues from these Belong eSports arenas doubled in the last year, leading to an announcement that 16 more will be opened in the coming months.

Brick-and-mortar retail isn’t about to go away, and even Amazon knows it. The mega-retailer has smart bookstores popping up across the U.S., and it’s apparent that c-stores and grocers are the company’s next big investment. Undoubtedly, these stores will continue to put stress on storeowners, forcing some shops to close and the remaining ones to evolve their offerings. The key to staying ahead of the curve? Think like Tsutaya and Sports Direct. Retailers that continue to provide unique consumer experiences will continue to thrive.