Brick-and-mortar vs. online retail (UPDATED)

One of the questions I brought up in my interview with Richard Gottlieb was whether it’s better for toy collectors to buy action figures at brick-and-mortar retail stores rather than, say, ordering them from online retailers. The idea is that this will encourage those stores (such as Target and Wal-Mart) to order more product, and since these retailers deal in huge numbers, that will help ensure the success of the line. This was Richard’s response:

My feeling is that anyone who is hunting at brick-and-mortar stores is doing so because they love the thrill of the hunt. For example, I used to collect first and rare edition Oz books and I experienced great fun, excitement and anticipation in walking into a used book store and not knowing what piece of treasure I might find. Therefore, I don’t think collectors should concern themselves with their impact on buying decisions so much as engaging in their passion.

In the comment thread for the interview, my fellow OAFE “Rustin Parr” wrote this:

I know the brick and mortar question was a result of a discussion (argument?) Poe and I had a few weeks back and honestly [Richard’s] response was pretty anticlimatic and not very insightful. I still remain a staunch believer that to not support brick and mortar stores will augment the industry’s implosion.

Volume is the most crucial element in sales and until any mass retailer goes on record commenting that internet orders are very comparable to B&M orders I still believe that B&M out orders/sells greatly.

[Richard’s] response just reads a bit placating and in general seems to be consciously riding the middle of the fence as to not offend any potential customer.

From here the discussion went private, but both parties have graciously allowed me to publish their comments.

Richard:

On another note, Rustin Parr felt I was being placating but perhaps I just did not do a good enough job of explaining my point. I do not believe that consumers, who organize themselves to take a specific action, have historically been successful. A notable example is product boycotts which all seem to fizzle. That is why I think any attempt to consciously make a shopping decision in order to shape the marketplace is a waste of energy. I do think, however, that the real power any group has lies in the enthusiasm they bring to that marketplace. Therefore, by exercising their enthusiasm, in whatever way is natural to them (shopping in an on line or brick and mortar store), will impact the market but many times in unexpected ways. (You can probably tell that I am kind of into emergence theory). This is the power of the marketplace and why it constantly surprises us. I hope this better explains my position.

Rustin:

His clarification does make more sense. While on its own the comments are […] not really all that substantive, taken in light of the recent talks of TRU moving towards more collector-oriented product I see a very clear and valuable point. The market will adjust itself to maintain sales. If people start moving towards just online purchases, then B&M stores will adjust to maintain sales on their own – hence Target and Wal-Mart’s aggressive exclusive programs and now TRU possibly shifting back towards the collector market (I saw the AVP2 hybrid there last week).

While I’ll still feel that buying at B&M is better overall than purchasing online I can see the point that semi-unpredictability will help to even things out. Hopefully with product more widely available we’ll see a return to the ease of B&M shopping. For me personally the cost/benefit ratio is a constant balance between locatability and cost. And cost is a huge factor to me since my figure tastes run so varied, soon enough (in fact it already has begun) I’ll have to not pick which lines I want to follow but be selective within those lines. Granted I’m not the end-all/be-all of collecting but I think I’m a fair example of symptomatic problems with the rise of prices, etc. – having to pick and choose much more than previously. Especially with all the different formats of collecting.

I understand Richard’s point that ‘stands rarely work’ (to paraphrase) but find it defeatist thinking that often leads to very bad situations. We need to support the things we believe in, whether it be a lifestyle, political candidate or just a pattern of consumerism.

If either Richard or Rustin would like to add another response, I will happily add it here. I think this debate is pretty fascinating, and very significant for action figure collectors. As for me, while I’ve traditionally supported online sales, my support is largely due to the difficulty and inconvenience of driving around to multiple stores trying to track down figures that scalpers have already bought.

UPDATE!

Richard adds:

Thank you for including a link to a definition for emergence theory. I do think, however, that the definition given by Wikipedia is overly complex.

Simply put, emergence theory states hat complex organisms are self organizing. They are therefore leaderless. Examples of this are anything from ant colonies to cities to the web. Any time a government tries to organize a complex organism (example Soviet Russia’s attempt to organize supply and demand from the top down) is disastrous.

How the tussle between bricks and mortar vs. the Internet plays out will be based upon literally millions and millions of small decisions made by thousands and thousands of people. In all cases, they will be seeking self-interest (i.e. the best price, ease of ordering etc.) Who will win and who will lose is difficult to predict but it will come as a result of the sum of all those parts.

Your readers might enjoy reading an outstanding book by Steven Johnson called Emergence. It gives some great examples.

On another note, Rustin wrote:

“I understand Richard’s point that ‘stands rarely work’ (to paraphrase) but find it defeatist thinking that often leads to very bad situations. We need to support the things we believe in, whether it is a lifestyle, political candidate or just a pattern of consumerism.”

I am in no way encouraging defeatist thinking. I am, indeed, encouraging passion but passion put to work in such a way that it has an impact. What are examples of this?

  • Work to establish best practices in bricks and mortar retailing
  • Recognize those who do it well so that others can learn from them
  • Explore a third way like that offered by Shopatron, a company that connects ecommerce providers with local bricks and mortar retailers. That way you can order on line and pick it up locally.

So be passionate, do care and do make a difference.