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Why same-store sales fall and web sales rises by Alpha Team

Retail channel is shifting to online. Stores have become unpleasant to shop, no matter what senior management believes about the experience. Consumers want a shopping experience that is quick and efficient, that they are in control of and that they can conduct on their terms. They don't want to have to track down a clerk and explain what they're looking for, knowing all along that the answer in most cases will be that it's out of stock.

My experience only confirmed why I do not shop in stores. The floor in the footwear department was littered with inserts from shoeboxes, as if the customers or the clerk had simply thrown the inserts on the floor and no one could be bothered to pick them up. Other merchandise was displayed haphazardly. Shirts and sweaters had been dropped on displays with no attempt to fold them or present them neatly, apparel was on the floor and the store had a general feeling that no one- not the salespeople, not management-cared about the customers' experience.

Already, anecdotal evidence is piling up that consumers have made that decision. Same-store sales in plenty of chains are flat or down while online sales grow. A few recent examples: Gap Inc.’s second quarter, same store sales were down 5% from a year earlier while web sales were up 26%; Kohl’s Corp.’s Q2 same store sales were up 1.3% while web sales were up 60%; Staples Inc.’s same store sale were down2% while web sales were up 18%. And even at Williams-Sonoma Inc., which has great stores, same store sales were up 1.2% while web sales were up 11%.

Kurt Peters
Editor-in-Chief
Internet Retailer

This article was published on Tuesday 26 September, 2006.
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