Amazon Breaks Into the Top 10 Retailer List
Over the past decade, consumers have shifted their shopping habits from the “real” world (i.e. brick-and-mortar stores) to shopping virtually. Now for the first time ever, Amazon.com, the largest online-only retailer, ranks among the top 10 largest retailers in the United States. STORES, the publisher that compiles the annual report that looks at the combined in-store and online sales of retailers, stated that “the impact this Seattle-based behemoth has had on the changing face of retail is unmistakable.” Amazon is the only top ten retailer (a list that includes Wal-Mart, Costco, Target, Home Depot, Walgreens, CVS, Lowe’s and Kroger) to see double digit annual growth.
Amazon, whose U.S. retail sales rose 27.2% to $43.96 billion in 2013, wasn’t the only e-retailer to see significant annual growth. Overall, e-commerce grew 17% last year. Online sales helped boost or salvage overall sales for several traditional brick-and-mortar stores. For example, Best Buy’s overall sales fell 1.2%; however, it saw a 20% increase in online sales. Wal-Mart and Nordstrom both reported declining in-store sales, but saw an overall sales increase due to increases in online purchases. Companies who saw some of the biggest declines in annual sales were those that experts consider as having weak online presences.
According to Kantar Retail Chief Knowledge Officer Bryan Gildenberg, “Amazon’s rise into the top 10 is symbolic of a shift in U.S. retail towards a genuinely multichannel future. Retailers that command the Top 100 in the future will have an in-depth knowledge of their shoppers across their physical and digital touch-points, and they’ll all have to fend off Amazon’s game changing economic and operating model.”
Retailers have long fretted over the threat that e-commerce poses to their businesses. In an age where consumers rely more and more on their smart phones and tablets to make every day purchases, rather than driving to the nearest mall, it is becoming more and more important for traditional brick-and-mortar retailers to create strong online presences.