The History of Brick-and-Mortar Retail and What's in Store for the Future

No matter what changes, one principle remains the same in retail: the importance of getting customers the products they need and giving them a great experience while doing so.

shopping center
Grigory Bruev/stock.adobe.com

No matter what changes, one principle remains the same in retail: the importance of getting customers the products they need and giving them a great experience while doing so.

Of course, brick-and-mortar retailers certainly have changed over the years. Store sizes have expanded and contracted, technology has transformed processes and procedures, the internet has enabled new ways of selling, and marketing and customer expectations for what they want in an in-store experience shift each year. The COVID-19 pandemic has also impacted brick-and-mortar operations and will be a time that future retailers point back to and say, "That was a moment that changed retail."

Brick-and-mortar retail has a bright future — simply consider the fact that small business revenue has grown 53.05% between 2016 and 2022 — but only if retailers can learn from the past and embrace the future.

A Short History of Brick-and-Mortar Retail

The history of brick-and-mortar retail dates back as far as people have been selling products to other people from a physical location. In the modern age, think of general stores, the primary retail experience that served communities living outside of cities in the 1800s. The general store carried everything someone could need in one location — though the experience was more utility than anything and very different from the specialty shops and urban markets of the city.

As more people began moving to cities in the mid-1800s, the need for a one-stop-shop was realized in the creation of department stores, with Jordan Marsh opening in 1841, Macy's opening in 1858 as a dry goods store, and Sears — with its mail-order catalogue business — opening in 1886. Department stores carried everything consumers would need, from clothing to home goods to furniture, and often featured "evocative displays, exhibits, demonstrations, and lectures," creating a truly unique shopping experience.

After WWII the population began spreading to the suburbs, and another concept arose as well: malls. Typically anchored by department stores and "big box" stores that were created in the mid-1960s, malls catered to many different demographics of shoppers, with an experience that included not just stores, but food courts, movie theaters and other entertainment.

The next big shift for retail? The internet. E-commerce officially began in 1979, and the 1980s and 1990s saw a revolution in the way people could shop. Now consumers could visit a website from their home—like Amazon, launched in 1995, with no physical location—make purchases using their PayPal account, and simply be shipped their products.

With the rise in popularity, ease of use, and convenience of online retailers also came the question: "Is this the death of brick-and-mortar retail?" It seemed so when, in 2016 and 2017, brands like JCPenney, RadioShack, Payless, Urban Outfitters and many others closed their stores or filed for bankruptcy.

It wasn't the death of brick-and-mortar but the beginning of brick-and-mortar needing to look different from what it had been. Knowing that they couldn't compete on price or breadth of inventory, many brick-and-mortar retailers knew they had to compete on experience instead.

A 2020 study of independent bookstores found that because they couldn't compete against Amazon on price and convenience, brick-and-mortar stores focused on creating community, providing hand-selected product curation and offering a place for people to convene over shared interests. By creating a great in-store experience for customers, independent bookstores grew despite Amazon's presence — a 49% growth in the number of stores in the U.S. between 2009 and 2018.

Then came the COVID-19 pandemic, and with it lockdowns that forced many retail locations to close to customers for upwards of two years. Literally overnight, brick-and-mortar retailers needed to rethink their business strategies and get creative with new initiatives. These included innovations like buy online, pick up in-store (BOPIS) options, curbside or home delivery, virtual concierge service or events to keep engagement high, and expanding their ecommerce offerings.

Now that the pandemic is easing, and stores are reopening, where do we go from here?

Brick-and-Mortar Retail's Future Trajectory

Already retailers have been adopting new innovations like touchscreens to facilitate checkout, apps to help find products in the store, and digital displays to keep customers up-to-date on both in-store product features and safety measures. (Disclosure: My company helps with digital signage.) As retail moves forward, I don't think it will go back to many of the approaches it had before the pandemic — it can't, especially since customers are now used to in-store features like BOPIS and self-checkout.

The advice I would give to retail leaders is to brace for supply challenges using innovative technology. Embrace the retail-tainment model for shoppers who want more than just goods and services. And be ready to deliver products through multiple channels, faster

I think the retailers who want to engage customers will continue to embrace new strategies to enhance the in-store experience. They'll also focus on providing customers a great atmosphere, delivering excellent customer service, offering personalized experience, getting customers connected to the right product or service and providing a frictionless experience overall. Ultimately, continued customer engagement depends upon creating a great in-store experience that makes customers want to return and have that "day out" experience that the history of retail has led to.

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