Ron Johnson loves stores but says retail is moving to ‘commerce at home’

Photo: Enjoy
Sep 22, 2021

Ron Johnson, the former CEO of J.C. Penney (that didn’t go well) who also ran Apple’s retail business and was vice president of merchandising at Target (two resume burnishers), thinks the retail industry is moving towards a major disruption arising out of technological advancements and a subsequent shift in the way consumers shop.

He calls this paradigm shift “commerce at home” in an opinion piece published yesterday on Fortune.

Mr. Johnson asserts that commerce at home is already underway. He cites a readiness on the part of consumers to shop differently, with three-quarters, according to McKinsey, having tried new ways of shopping since the pandemic hit the U.S. last year.

“Over the last several years, we have turned our homes into hotel rooms, our cars into taxis and our spare bedrooms into fitness studios,” writes Mr. Johnson, who asserts that all three examples are representative of commerce at home.

Mr. Johnson writes that consumers are already constantly deciding whether to go to a store or to place their orders online. He thinks that stores will become less relevant as retailers are able to offer customers “the products they love accompanied by a high-touch, in-home experience tailored just for them.”

He points to his Apple experience as support for his thesis. “One of the most frequent compliments I heard from customers leaving the Genius Bar was: ‘I wish I could take you home with me.’”

Mr. Johnson’s current venture, Enjoy, has been described as a “Genius Bar on wheels.” He called Enjoy “a personal commerce platform” when he launched the company  in 2015.

He doesn’t believe that consumers will have to keep making the choice between convenience, a major benefit of current online shopping, and high-quality experiences, typically associated with stores.

Consumers, today, demand convenience and no longer tolerate poor experiences. Commerce from home represents a logical progression from where retail stands now. Getting to that next place is something worth embracing and celebrating when it happens, he concludes.

DISCUSSION QUESTIONS: Do you see retail in the future combining the convenience of online shopping with high quality experiences in the homes of consumers instead of in stores? Are consumers and retail already heading in this direction and what will it take to get there?

Please practice The RetailWire Golden Rule when submitting your comments.
"The store is theater and you can’t replace live theater with TV. I believe that transforming your store to a stage is a better play."
"The physical store is here to stay but this concept is a great way to get even closer to the customer which can directly impact product feedback and assortment decisions."
"I find it hard to believe that with people cooped up for so long, they’d want the store to come to them rather than them going to the store."

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31 Comments on "Ron Johnson loves stores but says retail is moving to ‘commerce at home’"

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David Naumann

Online commerce has accelerated during the pandemic and it will continue to increase its market share for the foreseeable future. The convenience of shopping from home has now become a habit for many consumers. However for some categories, such as apparel, online shopping can’t fully replicate the in-store experience and will be the last to fully convert to “commerce at home.”

Neil Saunders

This is a view that is often floated by those working in technology or e-commerce related sectors. Unfortunately, it ignores the reality on the ground and falls into the trap of seeing retail in polar terms of online and offline. The truth is that consumers have not abandoned stores. Even during the middle of the pandemic, the vast majority of sales were still transacted in stores. Moreover, the customer blends online and physical shopping; they don’t see it as either-or. The worst error, however, is the assumption that most people want to sit in their homes and never venture out to physical spaces with all they have to offer in terms of mental stimulation and social interaction.

Katie Thomas

I completely agree – and mall traffic was up to some of its better pre-pandemic levels before Delta really hit. On top of that, isn’t he missing one key aspect of stores and shopping – the socialization/activity of it? Going to the mall isn’t just transactional, it’s spending time with family and friends, enjoying each other’s company, getting input on purchases – lots of perks!

Mark Ryski

Some people may want high quality experiences in their homes, but I disagree with Johnson’s premise that physical stores will become less relevant. There’s no question that the expansion of online commerce has changed shopping dynamics, and I have no doubt that some consumers may want to create high quality experiences in their homes – however they may define that – but to suggest that this will displace physical retailing is nonsense.

Ken Morris

The store is theater and you can’t replace live theater with TV. I believe that transforming your store to a stage is a better play. Of course people will always shop online, but replacing the live entertainment aspect with an online experience, while convenient, will never dominate the shopping experience. Impulse buying, upselling and cross-selling all suffer in the online world. Transforming the store to a distribution point is more in line with what shoppers want.

Bob Amster

Notwithstanding the fact that we are direct competitors, I have to say that I think you hit the spot! The late Marvin Traub may have been the first notable person to say it, but you have reminded us of why stores will continue to exist.

Gene Detroyer

I agree with you 100 percent. But the key caveat is if retail management can do it. They must get out of the mindset that sales in a store must justify the store.

Jeff Sward

What a great way to express it!

Bob Phibbs

Ron Johnson is not a visionary to me. He’s a media-hungry guy looking for digital ink – just look at how there was really no there-there with J.C. Penney. Retailers with stores are finding shoppers increasingly are returning in droves. If we all wanted to work from home and shop at home that wouldn’t have been the case. Window coverings and floor coverings have offered shop from home for a while and it is still just a niche. Consumers want high-quality experiences – yes and where do you get those? In a store with trained employees who you don’t begrudge paying $15-$20 an hour.

Gary Sankary
Regarding this idea that stores are going to go away and online shopping will take over — it feels to me like the industry is thinking about this as a zero sum game, when in fact it’s a segmentation issue. There are a growing number of consumers who have moved most of their shopping to digital channels. I think many of these folks are people who viewed shopping and store visits as a chore, and are now delighted to not be so burdened. There’s also that group that loves interacting with physical retail. Those folks are already back in stores and doing their thing. And the majority of us are somewhere in the middle. A bit less time in the stores, a bit more online. From my perspective retail is finally delivering on the unified commerce promise that we’ve been talking about for 15 years. The pandemic forced retailers to invest to the capabilities that delivered curbside and home delivery. It forced them to clean up their digital experiences, to make search and check out… Read more »
Richard Hernandez

I think people still want to touch and feel so I don’t think that stores can become irrelevant – at least not now, especially when it comes to clothing and large purchases like cars and appliances.

Dick Seesel

The recent resurgence in store traffic, although set back by the Delta variant, suggests that people are tired of living in their caves after 18 long months. The longing for socialization and experiential retail can’t be offset entirely by the desire for convenience and safety. Stores like Target have given shoppers compelling reasons to walk into their stores, not just to park outside to pick up their online orders — and it’s essential for the successful retailer to master both.

Raj B. Shroff

I think there is room for commerce at home, humans love choice (not too much though). For some people, like that perfect upper class family in the video buying Apple products, an in-home experience over a store one makes total sense. However like the others on this panel, I don’t think people want to huddle at home all day and have these intimate 1:1 experiences with retail associates in their home.

As for consumers and retail heading in this direction, maybe a percentage. For mass brands like Nike and Apple, sure, I can see it working. For higher end brands an at home component definitely makes sense. But the majority of shoppers and shopping is regular people buying regular things on e-commerce sites or in stores.

There is room for this concept but I don’t see a massive shift over to it any time soon.

Gene Detroyer

“Humans love choice (not too much though).”

Anecdotally, yesterday my wife was out and decide to stop at Nordstrom on her way home. Apparently, she has been thinking about purchasing a particular piece of clothing. The stop at the store became a source of frustration as they didn’t have anything close to what she wanted.

When she came home, she went to the Nordstrom website to search for what she wanted. She put the item into the search and Nordstrom gave her 110 pages. Too much choice. She didn’t even start looking and did not buy anything.

Jeff Sward

I’m not sure how different “commerce at home” is from what we have long simply called e-commerce. Or maybe it’s been “couch commerce” all along. Or as a lot of students of the market like to now say — it’s all just commerce. And yes, it now has a lot more moving parts than it did a short time ago. I’ll continue to make the distinction between buying knowns versus shopping for unknowns, and how the different channels serve and support those customer choices. Malls and individual retailers are waking from their multi-decade snooze to the new realities of shopping, buying and customer service and customers are proving with their post-pandemic (sort of) energy to get out and about that the physical store still has a huge role to play in daily life.

Liza Amlani

White glove service is nothing new and this is just a new way to capitalize on what the customer is craving right now. Seamless and delightful customer experiences focused on speed and service.

The physical store is here to stay but this concept is a great way to get even closer to the customer which can directly impact product feedback and assortment decisions. As long as you have the right people on the ground serving the customer and customer obsessed merchants on the backend, this is a wonderful way to build deeper relationships.

Mohamed Amer, PhD

The store as we know it will never be the same again, yet it remains core to retailing. Digital technology combined with faster bandwidth and increasing access is transforming the once unthinkable to the now possible. That said, the concept of a store requires a revisit. I think of a store as a space (physical or digital) that attracts consumers with experiential settings created through unique combinations of products, services, and visuals that surprise and delight. The home, the mall, the physical and online stores, social media, videos, the concert hall, the hotel, and much more are blurring shopping boundaries and redefining commerce as a whole.

Paradoxically in this melange of commerce, the physical store will become even more relevant as a “real” branding reference that connects with the digital experiences at home, work, or play.

Gene Detroyer

My five teenage grandchildren are all old enough to have their own money. Except for my granddaughter, who haunts second-hand shops, the others never even think about going to a store. That doesn’t mean they are not buying stuff. They are generating daily deliveries among the five of them.

Are they the exception of their generation? If they are not the exception, stores face a questionable future.

This year, online sales represented 18 percent of retail sales. It would not surprise me if when my grandchildren become of age and are on their own, that the shares will reverse, with online representing 80 percent of retail sales.

Ryan Mathews

Nice idea — if you like ideas for their own sake, even if they will never be implemented. On the very highest levels we do see some of this – personal shoppers, clothes consultants, custom home audio designers, interior designers, etc. But at any kind of scale? Not happening. How many people have the time or inclination to let folks into their homes to pitch them? That sort of went “out” with the Fuller Brush man, print encyclopedias, and the vacuum cleaner sales folks. So if high-end shoppers are already doing this, and have been for years, and value-shoppers are too busy, too paranoid, or too anything to make time for in-home “consulting” aka selling, where’s the market?

Ricardo Belmar

There are two goals consumers want very much in their commerce experience – convenience and independent expertise. The traditional method to achieve these goals was to visit a nearby, conveniently located retailer’s store and rely on a well-trained store associate to provide the expertise. Today, that’s not convenient enough for many consumers. For them, what could be more convenient than commerce at home? Equally convenient to e-commerce or social commerce, but including that desired expertise from an expert that visits their home. There’s much to like in Ron Johnson’s approach in that model, however one has to wonder how easy it can scale for most retail brands. Perhaps this is the future of retail frontline workers – becoming traveling salespeople but equipped with “Genius Bar” levels of expertise. Merchandise can either travel with the associate or be delivered later via traditional e-commerce fulfillment models. The fact is, “commerce everywhere and anywhere” is where most consumers’ heads are already – and the idea of “commerce at home” is just one implementation of that.

Lisa Goller

Yes. Home is our hub, and retail convenience and service excellence will continue to come to us.

To get closer to consumers, retailers are investing in:

  • Logistics: Last-mile partnerships, local fulfillment, dark stores, ghost kitchens and lightning-fast delivery.
  • Entertainment: Vibrant sensory experiences across digital properties, including livestreaming, are enlivening e-commerce. TikTok is coming to Amazon Fire TV and digital ads across retailers’ media properties will be a huge growth area.
  • Innovations: Looking ahead, voice will grow and this year’s Super Bowl ad showed how Alexa is increasingly helpful around the whole house. Commerce at home also drives Amazon’s and Walmart’s investments in autonomous vehicles and drones for home delivery.

Stores still have an advantage with immediacy and multisensory experiences. Yet many of these e-commerce investments aim to fill those gaps for a superior online experience.

Doug Garnett

It is disappointing to hear Johnson speak without much understanding of the uniqueness of the Apple stores — where product delivered their success. Yes, he put in place many good things which increased the success. None of that would have meant anything, though, without the extraordinary Apple products.

Of course the future is a mix of online and in-store shopping. But I don’t really hear from him any unique insight into how to thrive with that. And will it be a disruption? The upheaval in retail has already begun — it began years ago. I simply can’t endorse claiming there is “disruption” ahead.

Brandon Rael

Physical retail stores are alive and well. According to the U.S. Department of Commerce, the e-commerce percentage of total retail business remains approximately 13 percent. Despite the false narratives that the retail stores have seen better days and that everyone is shopping online, the customer journey knows no boundaries, and there is no real differentiation between offline and online trips. The physical retail stores are as relevant as ever.

While Ron Johnson’s take on customer experience is a unique personalized and digital-first one, by no means will this disrupt the entire industry and replace the multisensory experiences of physical stores and showrooms. The go-forward shopping experience will be hybrid, with customers seamlessly navigating between retailers’ apps, social media apps, showrooms, and livestreaming experiences. There is no one physical or digital solution that will disrupt the industry as we know it.

9 months 14 days ago
This is both destined to be and be-damned at the same time. It is quite obvious that shopping (dining, et al) is mostly about getting what you want at its most convenient and economical. And that human interaction, by way of an associate/cashier/waiter, is becoming more moot by the minute. It will only be for those (few) times where and when an “in the moment” experience is key to a sale (or luxury sit-down meal) that it will be necessary to have a go-between employee. At best (or worst?) most workers are merely where they are working: as caretakers of the goods or services that their companies provide customers. And like toothless shepherds we are tending sheep that want what they want when they want it. (Which is now to the point of being droned to their place of grazing.) The great sadness of all this will be: the loss of those little incidental but oft-interesting and endearing crossings of paths, between people (staff and guest) in real and physical time, that makes being us… Read more »
David Mascitto

I find it hard to believe that with people cooped up for so long, they’d want the store to come to them rather than them going to the store. The future of retail will be a mix of online and physical shopping. Online for the stuff you don’t really feel like shopping for or that’s a hassle (e.g. groceries) and stores for the stuff that’s fun to shop for (e.g. fashion apparel, cosmetics, tech like mobile phones, sporting goods, etc.) or that you absolutely need today.