Why the retail battle between independents, chains and department stores continues to rage on.
When Footwear News launched in 1945, the retail landscape for shoes looked very different than it does today. Local independents were the go-to retail destinations for women, men and children.
As they gained momentum, smaller strip-mall chains like Kinney Shoes — the future owner of Foot Locker — and Edison Bros expanded in the 1940s, signaling a wave of change.
Soon, independents in downtown shopping areas struggled to keep up with national players like Payless, founded in 1956, and flourishing department stores, as people moved out of city centers. The 1960s ushered in the rise of suburbia, and another retail innovation: the mall.
In 1976, Howard Davidowitz of S.D. Leiesdorf & Co. declared at a National Shoe Retailer association workshop covered by FN: “Footwear retailers have to admit the future of retailing is in the mall, and learn to cope or go out of business.”
The 1970s and ’80s debut of big-box stores like Walmart, Kmart and T.J. Maxx ushered in the price-conscious shopper, along with the gender-specific specialty store and athletic concepts. Foot Locker was founded in 1974, and Finish Line followed the year after.
By the mid-1990s, many department stores had consolidated, giving rise to the off-price retailer — DSW debuted in 1991. At the same time, the number of smaller stores continued to shrink.
It wasn’t until the late 1990s that online sales became a topic of conversation, but once it did, the web became the most important and dominant retail issue. Just as the mall had shaken up the retail model, online shopping hit today’s brick-and mortar stores with similar force — not just by shifting consumers’ behavior but also their expectations and what they wanted to buy. The rise of the Internet — and shopping via mobile devices — has made every consumer smarter.
The debut of Zappos.com in 1999, with its wide selection of brands, free returns and user-first approach, was a milestone for shoe e-commerce.
In the high-end realm, Net- a-Porter.com, launched in 2000, transformed luxury shopping by becoming the online destination for shoppers as well as luxury brands seeking a partner to run their e-commerce efforts.
As online momentum took hold, brick- and-mortar stores embraced the concept of omni-channel like never before.
In 2012, Glenn Lyon, CEO of Finish Line, told FN that he expected Amazon.com to launch a day-of delivery service, which the online retailer did in 2014 in New York. Amazon continues to push the boundaries of e-commerce, recently introducing one-hour delivery in some cities for certain basic goods.
“This isn’t science fiction — it’s real. Whereas it used to be, ‘Who has the product?,’ it’s going to be not only who has it but who has it and can get it to the customer in a way that’s easiest for the customer,” Lyon said.
“Inventory is a foundational part of omni- channel. The ones that solve the inventory challenges first and get their house in order will be the ones to excel,” said Kurt Salmon retail strategist Robert Howard. “The next frontier in shopping is using personalized information.”
Under Armour and Toms introduced “brand houses,” or retail locations focused more on creating a personalized, brand-defining experience that shoppers would see translated on their devices when they left.
Rebecca Minkoff and Ugg Australia — which opened concept stores in 2014 — are playing with interactive fitting rooms, in-store content and smart screens to offer expanded inventory and deliver a more nuanced understanding of the consumer. The benefit of that mobile, online and in-store integration: knowledge of the customer.
“We can know when a certain shoe and jacket are doing well in a San Francisco store, for example, and we can prioritize them and adjust e-commerce messages around those items. Our technology is across all of our platforms, so it can impact the lines of communication based on a certain area because of the data we are getting,” Rebecca Minkoff CEO Uri Minkoff told FN last November during the opening of the label’s first U.S. brick-and-mortar store.
Another result of the growing online demand has been the rise of brands offering products direct to consumer. With a website storefront, major labels, from Steve Madden to Nike, can now reach shoppers wherever they are, entirely bypassing retailers.
Additionally, brands are realizing that consumers are hungry not just for the convenience of online shopping but also for the content and visuals that go along with it. Natalie Massenet’s “Notes Weekly” newsletter, which planted the seeds for Porter magazine, is just one example of the power of fashion content.