Retail Sales Results as Reported or: If it bleeds, it leads.
The American newspapers are hurting and the Internet is at the center of their malady.
The advertising model of the newspapers is rapidly declining in usefulness and their poor job of reporting the news is a large contributor to their problem.
Before the Internet, the newspapers were powerful and imbued with a sense of self importance that was ripe for being taken down a peg or two. Ten years ago there was almost no one in the news media that understood what the Internet would do to the reporting of events and coincidentally how the advertising structure would change.
Newspapers continue using the old credo “If it bleeds, it leads. In the post Christmas reporting of retail sales the bad news once again was the lead story. The recession effect on retail stores was outlined as the end of an era and would cause the emptying of malls and retail centers across America.. There was a significant omission in the reporting of retail sales in the use of the bad news leads structure of the newspapers. Everyone easily could find the reports of retail sales drop of between 5% and 8%. There was another side of the story that was not so easily found.
The Montreal Gazette carried the story that Amazon had its best ever sales results for the Christmas season. This was not reported as a lead in my local paper and on the TV news. It showed up as a somewhat buried item later in the report of sales.
The story is significant because it is a clear foreshadowing of a new day for much of the retail sales in America. Online sales of all kinds of products have been growing year after year with no end in sight for its growth. There will be vacancies as a result of the recession and the overbuilding of malls and strip centers. Each American does not really need a personal store to be built. The personal shopping experience will increasingly take place at home on the computer screen or on a TV shopping network. Specialty categories and items requiring ‘try on” and well run stores will continue to prosper. Is anyone really surprised at some of the current failures such as Linens and Things. What” Things” were special and could not be found at Wal-Mart where they were “piled higher and sold cheaper”? (Sam Walton’s operating philosophy)
In business the giant companies often stay locked in to the comfortable operation that took them to success. New ideas and changing market requirements are often not recognized or simply ignored by many large companies management. The marketplace will empty the stores and malls that do not meet the changing market requirements. The overpriced homes will start to sell when their price level is reduced to the market acceptance. This level is closing in as we write. I think the housing turnaround will start in the Spring and the rest of the lagging economy will follow. There are unique aspects of this slowdown but at the core is a housing issue. When houses sell, the rest of the economy starts to move again. There are plenty of home buyers ready to buy. They simply are waiting to be sure that they are getting the best price. In the marketplace you can find commonsense decisions taking place when that capability is seemingly lost by the financial and investment geniuses on Wall Street.
If you enjoyed this post, please consider to leave a comment or subscribe to the feed and get future articles delivered to your feed reader.
Comments
No comments yet.
Leave a comment