The following article is by Kristi Muse, our staff writer. She is a great freelance writer, blogger, police officer’s wife, and stay at home mom of two.
Cyber Monday took place last week, and consumers spent more than 3 billion dollars online, beating out the 2.72 billion spent on Black Friday, which was both in-store and online shopping. Especially during the holiday shopping season, when people are so busy, it seems that the trend continues that many consumers prefer to do their shopping online.
There was a post recently on CNN discussing how Amazon has destroyed Barnes and Noble. Apparently, “Barnes & Noble’s long-term debt tripled from a year ago to $192 million. The company has only $13.4 million in cash … [and] shares of Barnes & Noble are now down nearly 40% this year.” It’s clear that consumers’ love of online shopping, and Amazon’s success, directly correlates to the struggles of other book, music, and movie sellers. Barnes and Noble has some tricks up its sleeve that may help them to avoid the fate of Borders, though, so don’t worry about them dissolving just yet.
Seeing how corporate giants like Amazon effects other (former?) corporate giants like Barnes and Noble makes you wonder just what the Amazon effect has been on smaller mom and pop shops. If empty store fronts where independent bookstores once stood are any indicator, brick and mortar bookstores are going the way of the dodo bird. They will that is unless we actively make a push to give our business to physical stores instead of online shopping. But, should we?
Why I like shopping online
Amazon is my first choice because they have made shopping so easy. I don’t have to leave my home with my two young kids who get cranky when I take them into stores. I can choose overnight shipping, and my items arrive at my doorstep in the next day or two. It takes a lot of stress out of shopping for things I both want and need.
They also have great prices. For example, the few toys I did decide to get for my kids for Christmas came from Amazon, because they had the lowest price on the items I was looking at buying.
What effect does online shopping have on the economy?
I’m not an economist. I just know that I, like most consumers, am driven by price. As much as I hate to admit it, the price is and always will be my swaying factor. I know in my head that Amazon has a reputation for shady treatment of their employees, but I, like others, get pulled towards which company offers the lowest price.
There are some family-owned businesses in our small town that I do go out of my way to patronize for gifts and clothes. When it comes to books and movies, though, because of ease of use and price, I’m more likely to just use Amazon.
I recognize that my penchant for shopping online could be the proverbial snowflake in the avalanche that causes workers at other retailers to lose their jobs. Unemployment certainly does no favors for the economy.
That being said, though, an increase in sales through Amazon will mean an increase in other jobs. We might not have as many booksellers, but there has been a surge in delivery jobs. Thousands of seasonal jobs are available over the course of the holidays through both UPS and Fed Ex, further boosting the economy. Those online sales mean more items are shipping, and more items shipping means more shipping jobs. More shipping jobs mean that more lower to mid-level employees have money to pay their mortgage, buy food and gas, and buy holiday gifts.
Finding a balance
Will online shopping from sellers like Amazon be the death of brick and mortar stores? No. Are they negatively affecting mom and pop stores and other book and music stores? Yes, as evidenced by the sliding numbers at Barnes and Noble and the failure of companies like Borders.
Online shopping will end certain jobs and create other new ones. No matter what happens on the job front, consumers will continue to be driven by price, so storefronts need to figure out a creative way to compete with online giants and win back the loyalty of their customers.
As with all things in life, it’s all about finding a balance between the two and not relying too heavily on one or the other. I’m not going to stop online shopping anytime soon, but I will also continue to frequent my favorite brick and mortar stores.
Do you prefer to do your shopping on online? Why or why not?
Online-Shop by Tim Reckmann, on Flickr.
For 2018, Joe plans to diversify his passive income by investing in US heartland real estate through RealtyShares. He has 3 rental units in Portland and he believes the local market is getting overpriced.
Joe highly recommends Personal Capital for DIY investors. He logs on to Personal Capital almost daily to check his cash flow and net worth. They have many useful tools that will help every investor analyze their portfolio and plan for retirement.
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