127 Years From Now, Will Amazon Be the Next Sears, Again?
So there was this company that saw a hole in America’s retail market and figured out a way to fill it.
Instead of making people spend their time visiting an actual store, which might or might not have a given product in stock, what if people could shop from home?
What if they could select their merchandise from pictures, order it and have it delivered to their door?
Genius, huh? All props to Amazon.
Or, rewinding the clock a hundred years or so, all props to Sears.
Which back in the 19th century was doing exactly what Amazon is doing today, give or take smartphones.
The difference: Amazon today is one of the two or three biggest retailers in the world, while Sears is gasping for breath and the priests of Wall Street stand on call to formally administer last rites.
Most shoppers in America these days have already forgotten Sears — even though, if it’s an afterthought, it’s a large one. Should the last several hundred Sears stores close and the company liquidate, which is the issue courts are deciding as we speak, more than 60,000 people will lose their jobs.
True, retail enterprises come and go, from Gimbel’s and B. Altman, Toys R Us, Borders and your favorite deli down the block.
But Sears isn’t just one more store whose sun rose and set. Sears was something bigger, something else.
Back in 1892, Richard Sears sold watches and jewelry by mail. A year later, he and his partner Alvah Roebuck had an idea.
America was still largely a rural country then, and farmers in rural areas were often at the mercy of their local retailers for supplies and credit terms.
Sears Roebuck & Co. started a mail-order supply service, offering competitive fixed prices.
The idea took off, fast. With two years Sears Roebuck had expanded into clothing, housewares, bicycles, appliances, medicine, sports equipment and you get the idea.
By 1895, the 532-page Sears catalog was the cornerstone treasure for millions of American homes. When fall rolled around and it was time for the kids to get their annual new pair of shoes, they came from the Sears catalog. Toys, pretty dresses, a new stove, a fancy electric light — all the dreams were right there in the pages of the Sears catalog.
Sears sold prefab houses. It sold its own line of automobiles. It had its own record label. It had its own radio station — WLS, for “World’s Largest Store” — and it eventually would construct the world’s tallest building, the Sears Tower in Chicago.
There was competition, like from Montgomery Ward. But Sears was the king of the mountain, a step ahead and a rung above.
For 30 years, Sears sold only by mail order. In 1925, its brand imprinted on the country, it started opening brick-and-mortar stores.
Like the catalog, those stores were positioned firmly in the middle. They didn’t feature high-end products, but sensible, stylish clothes and sturdy mid-priced hardware that would do the job. Some were Sears’s own brands, like Kenmore and Craftsman.
Sears was also business-smart. It was the first major retail company to raise money with an IPO, in 1906. When it opened stores, it didn’t position itself downtown, but on the close outskirts, so patrons in the increasingly automobile-driven culture could easily park.
Decades rolled by and Sears held its position. As late as 1989, Sears was the top-grossing retailer in America.
Then things happened. Some were inside the company, some involved the gradual emergence of midline competitors like Target and Kohl’s. Then the Internet came along and Sears, like every other conventional retailer, started losing customers to the seduction of shopping at home.
Oh, gods of irony.
In an eerie number of ways, Amazon followed the Sears playbook. In the process, Amazon also became one of the factors that drove Sears to where it is today, which looks like “almost out of business.”
Sears’s current chairman, Eddie Lampert, has made a multibillion-dollar bid to save some of Sears’s assets, including its brand and several hundred of its stores plus the real estate they sit on.
Lampert has been a controversial figure. Some say he’s tried everything to keep an accelerating fire from totaling the house. Others say he’s seen an opportunity to pick the last valuables from the ashes.
At the moment, things look, at best, bleak. It’s hard to see what could be reinvented that would make Sears viable again. But it would be a great story if Lampert or someone could do it. Saving tens of thousands of jobs wouldn’t be a bad ancillary effect, either.
And on the more theoretical plane, it will be interesting to see if, 127 years from now or sooner, someone is writing similar stories about Amazon.