Target vs. Amazon: Are more people shopping online or in-person?

If you’ve gone to the mall recently, it’s likely you’ve noticed “store closing” or “everything must go” signs around some of your favorite stores. Ten years ago, the mall was a hub for social activity and shopping. Compared to what once was, some of today’s shopping centers almost seem like ghost towns.

Retail ‘apocalypse’

Vox reports that in 2011, department stores in the United States employed over 1.2 million employees across 8,600 stores. In 2020, those numbers have dropped to less than 700,000 employees in over 6,000 stores.

Previous Deseret News reporting says that only three Kmart stores are left in the U.S. as of April 11, which is just a shadow of the the 2,000 locations that once dotted the map. Sears is also seeing dozens of liquidations and closures, Axios says.

Stores such as Christopher & Banks, Justice, Gap and Banana Republic each closed over a hundred locations last year, according to Money Wise.

What’s shutting down our department stores?

Vox partly blames the Great Recession, stating that since 2007, “the middle 40% of the U.S. saw its income shrink.” The American Prospect says that “many apparel retailers never recovered from the Great Recession.”

On top of the economic crash of the early 2000s, other factors include the rise of the internet and websites such as Amazon, which have offered the average consumer a wide variety of products for cheaper prices than are seen in many brick-and-mortar stores.

“Amazon is killing off much of remaining retail through predatory pricing, anti-competitive tactics and its hardening monopoly over e-commerce,” The American Prospect stated. Predatory pricing is known as placing the price of goods at a low price with the attempt to beat the competition, according to the Federal Trade Commission.

Antitrust committees have also accused Amazon of predatory pricing, stating that “Amazon has the incentive and ability to exploit.” According to CNBC, an antitrust committee predicts that the company is responsible for up to 50% of the U.S. online retail market.

What about the pandemic?

With the pandemic’s lockdown orders in 2020, many physical stores were forced to close due to a lack of business. However, as things began to open up again in 2021, more Americans flocked to shopping malls and in-person shopping centers, according to The Atlantic.

Even with a slight peak in brick-and-mortar shopping post pandemic, others predict that the overall trend for physical stores isn’t looking great. CNBC states that UBS predicts 50,000 brick-and-mortar store closures will take place in the next five years. Clothing, apparel and furniture stores are expected to take the brunt of the closures.

Light on the horizon

On the other hand, CNBC states that general merchandise stores such as Walmart and Target are doing well, and are expected to expand and open more stores in the future. Companies like Dollar Tree, Five Below and Tractor Supply are opening more locations as well.

Online-based companies with some physical stores are also seeing a boom in in-person business, according to CNBC. This is allowing companies such as Warby Parker and Allbirds to increase their brick-and-mortar presence.