Students turn to online shopping, leave department stores behind

As students turn to Amazon shopping carts and stray from traditional retailers, the mall strongholds are working to bridge the generational gap that is keeping them from department stores.

A survey conducted last semester by Katrijn Gielens , an associate professor at UNC’s Kenan-Flagler Business School, found that many college students see shopping at department stores as unsatisfying. Surveyed students said department stores are cluttered and associated them with older demographics, such as their mothers’.

But because brand loyalties form during early adulthood and the disposable income of the average college student is likely to increase over time, businesses seek college-aged consumers, Gielens said.

The survey was part of a term project Gielens ran in collaboration with a southern department store to determine what college students find desirable and lacking in department stores.

“The response (to the project’s survey) was mixed, but overall, it wasn’t too positive. To be quite frank, it was actually quite negative,” she said. “That is one of the things that came out of the research is that, say, 80 percent of department stores have a perception problem, and perception is often reality.”

Students often do not have an awareness of what brands are offered — and some of the brands offered are popular among those surveyed, but millennials just do not realize they are available at department stores, she said.

Many college students have turned to online shopping, which offers the same wide selection but easier, faster access, as a replacement for department stores.

“They want to be served immediately — not physically — but by immediately seeing the product they want to get,” Gielens said.

With changes in how the average consumer shops, expectations have altered, and Gielens referred to this as the “Amazonification” of the consumer.

Through an Amazon Prime subscription, online shoppers pay an annual fee in exchange for services including free two-day shipping.

“We expect everything here right now, and we don’t want to pay for it,” Gielens said. “Amazon has trained us that we don’t have to pay for delivery, and they can actually manage to deliver very quickly so that is the biggest issue.”

Benjamin Kdan , a sophomore from Asheville, is an Amazon Prime member and uses the website to shop 10 to 15 times a month.

“Convenience is the most important thing,” he said. “With my Prime membership I am not only saving through free shipping but also in convenience. It is nice having instant gratification when shopping in person, but why do that when I can shop online for cheaper?”

With advances in online shopping platforms, department stores have found it difficult to adjust their brick-and-mortar business models.

Gielens said a big trend for retail stores is to provide online ordering and in-store pick-up, but the logistics of turning a department store into a mini distribution center that rivals the Amazon’s of the world is expensive and difficult.

One strategy department stores like J.C. Penney have used is to increase their accessibility through smartphone platforms.

“JCP.com is key to our shopping experience, and we continue to invest in online and mobile experiences that is important not only to younger customers, but increasingly to all customers,” said Kate Coultas , spokeswoman for J.C. Penney.

To combat competition with other retailers, department stores have sought exclusive deals with brands and offered retail space to trendier brands within their stores. For example, Nordstrom has a deal with Topshop, a British retailer. In the survey, Nordstrom was one of the only department stores to have mostly positive feedback.

Gielens said she believes specialization is where the future of department stores are heading.

“I do think there is most definitely a future for physical retailing, but maybe there will be a shake-up,” she said.

“You have to pick your niche better. It is all about finding something that differentiates you — if you have the same product as your competitor then it becomes a pure price game, and you will be outcompeted by Wal-Mart.”

state@dailytarheel.com