WaPo: 91.4% Of Retailing Takes Place In Physical Stores
Shopping centers vs. e-tailing has been a big storyline for nearly fifteen years. Surely, displacement of retail by web-based shopping is a significant thing, but a recent study by BoA Merrill Lynch Global Research, published by Washington Post suggests that the high drama of the conflict may have been a teensy bit oversold.
Make no mistake: the study’s numbers do point to e-tailing’s power. The total online retailing business done is today 8.6%, up from 5.2% five years ago.
These two data points made me curious. When might the total percentage of retail done online grow higher than 10%?
When I extrapolate that trend quickly (and sloppily), it suggests that the percentage will cross the 10% threshold at some point in 2015. My chart is below. (Note: I am not an economist – I’m just drawing out a trend line from a mere two data points and seeing where the line goes, given bare minimum information. What I’m saying is: don’t quote me.)
Old School Still Rules
All that said: brick-and-mortar retailing is still the overwhelming favorite over online retail, according to BoA Merrill’s study. Among what the study deemed “applicable” items – total retail sales excluding autos, gas and food services, online shopping takes up not yet 9% of the total pie.
To put it another way: square footage remains retail’s key enabler by a huge margin.