No surprise, Internet shopping is booming. Nearly every real-life store has an equally attractive perusable Web site. For some retailers, Web sites are doing as well as, if not better than, their in-store sales, and now they offer online-exclusive merchandise or eliminate their physical stores all together.
Active Endeavors, a Chicagoland-based fashion retailer, did just that. This year they closed all three locations and turned their 5-year-old business online-only. A Chicago Tribune article published early this year stated that Active’s Web site accounts for about two-thirds of the company’s total revenue. Abby Dunn, public relations director for Active Endeavors, says that since the business closed their stores, their online traffic has been higher than ever. Dunn says the change is not only more cost-effective, but also much easier to manage and more practical.
Internet-based businesses also have the advantage of not being tied to a specific market. That market, once only open to the Chicagoland area, is now available to anybody with Internet access. Dunn says this is the future progress of the company. “We will continue to grow our online business with the addition of high-end collections and must-have merchandise for customers,” Dunn says. “We already have customers in Europe and Asia, but hope to expand online to reach the globe.”
Will the Internet takeover the mall experience? According to Marc Strich, general manager of Woodfield Mall in Schaumburg, it’s not likely. Strich, who has been the manager for nearly eight years, says there will always be a demand for shopping malls, but he acknowledges the growing presence of Internet sales. “I think malls have learned to utilize the Internet,” Strich says. “Consumers value their time as much as they value prices and selection, so the Internet as a complement should enhance their sales.”
When malls first hit the Midwest, department stores were the source for specialty fashions. To keep today’s mall-shoppers happy, however, Strich says there’s been a shift away from department stores to smaller, more specialized shops. This is why mall revenues have grown more among non-department stores than among department stores in recent years. “I think you have different reasons for going to the mall and those evolved,” Strich says. “Woodfield has grown because of its appeal to all markets and age groups.”
Every year, about one-seventh of the stores at Woodfield relocate or remerchandise, keeping selections fresh. So far it’s effective. According to Strich, Woodfield stores have had sales gains every year since their expansion in 1995, despite increasing property costs. “We have to work in finding the right merchants that our customers really want to continue to have a higher sales number and afford the higher occupancy costs that have risen over the years.” This mall, at least, isn’t going completely virtual anytime soon.
