By Keri Algar
SYDNEY, NSW: The IbisWorld report uses examples such as the cinema, travel agencies and department stores to show that the anticipated demise of these industries in the face of increased online competition has not eventuated. In the case of department stores, specifically Myer, the analysts bank on buying power as a major drawcard to thwart the online threat.
Click here to sign up for our FREE daily newsletter
“Occupying large amounts of expensive retail floor space, and often selling at above-average prices, department stores have long been tipped to suffer in the face of online retailing,” said the report.
“The past five years has been difficult for many retailers…[with] retail pegged to migrate more towards discounters, specialists and the internet; and the reverberating effects of the global financial crisis.
However, damn the doomsayers said IbisWorld who predict department store revenue to increase by 1 per cent this year and who forecast a further 1.6 per cent annual growth over the next 5 years.
“The industry is far from ‘on its last legs’ – with innovation and buying power playing key roles in their continuance.
“The buying power and reputation of the companies in this industry will enable them to resonate online, while the recent $300 million investment by Myer into its flagship Melbourne CBD store is a vote of confidence in the ongoing relevance of the luxury in-store experience.”