Stores, Good God Y'all — What Are They Good For?

In 2013 legendary venture capitalist Marc Andreessen predicted that all retail would move online. He said the physical store was a doomed structure, and e-commerce would become the only form of commerce.

Lucky for him, he never specified a date. He’s been wrong, and not by a little.

In the dozen-plus years since he made what is looking like the world’s dumbest business prediction, retailers have opened many thousands of brick-and-mortar locations. Sales through physical stores in the US have grown every year, and stores still hold nearly 80% market share.

America’s largest retailers have committed north of $20 billion to remodel more than 12,000 stores. Dozens more have aggressive opening plans, from the old guard like Walmart, Target, and Costco, to newer brands like Warby Parker, Vuori, and Tecovas. Even Boot Barn is opening 70 locations a year on its way to 1,200. You do not put that kind of capital behind a structure you believe is doomed.

Andreessen’s mistake wasn’t his data or his read on e-commerce. It was that he didn’t understand what stores are for. He saw the store as the place where a transaction happens, and once the transaction could happen online, the store looked obsolete. But the store was never just a transaction point. It has a set of purposes, and the smart money has spent the last decade investing in them.

There are two narratives here, and conflating them is the surest way to misread what’s happening.

The first is the job side. The value-oriented behemoths aren’t investing much in joyous, deeply human experiences; they’re investing in operational efficiency.

Walmart is partway through a $9 billion remodel program, with another 650 supercenters and neighborhood stores on deck. Target just unveiled its most ambitious store transformation in more than a decade: $5 billion, 130-plus remodels, 30 new stores, 300 new locations by 2035. Dollar General is refreshing more than 4,000 of its 20,000 boxes. Wider aisles, picking stations, drive-up canopies, refrigeration, digital price tags. It’s the store as the fastest, cheapest last-mile node a retailer has, and the place where BOPIS, curbside, and returns happen.

Stated simply, the job focused store serves the buyer. The joy side serves the shopper. And buying and shopping are not the same activity wearing different clothes.

Buying is a transaction, an errand, a problem solved efficiently, the logical brain knocking something off the to-do list. Shopping is another thing entirely: experience, discovery, identity, the pleasure of the hunt. Emotional, not logical. It’s one of the oldest human activities we have.

People have gathered to trade, browse, haggle, and show off for as long as there have been marketplaces. The agora, the souk, the Islamic bazaar, the medieval fair, the Japanese shotengai, the department store, the mall, the farmers market.

The objection goes: “If almost all incremental retail growth is online, why are these companies pouring billions into stores?” The premise is half wrong. Stores still account for the vast majority of retail sales. Walk away from that volume to chase the minority and you end up losing at both.

ICSC has been quietly building the best data set on this. Its Halo Effect III study found that opening a new store lifts online sales in that trade area by 6.9% over the following 13 weeks. For emerging and DTC brands, the effect nearly doubles, to 13.9%. Web traffic climbs roughly 37% in a market when a store opens. The asymmetry should keep CFOs awake: closing a store cuts online sales in that trade area by 11.5%. The clicks follow the bricks, and vice versa.

The store can be the dot-com’s most valuable asset, not its competitor. Every storefront is a billboard for the digital business, and the box itself is often the cheapest last-mile node a retailer has in a battle to neutralize Amazon.

McKinsey and ICSC just published a big report on the future of stores. Most of the coverage ran with the shiny number — agentic commerce, up to $1 trillion in U.S. B2C revenue by 2030 — and missed the actual point.

Far from making stores irrelevant, AI-driven commerce raises the bar. Every store needs a clearly defined role: convenience or discovery, speed or engagement, a destination to clear your to-do list or a place to tell brand stories and build your tribe. The more shopping moves upstream into AI enhanced discovery, the more the physical store matters, as either the fulfillment node that closes the loop, or the experience that justifies the trip.

McKinsey estimates the top decile of retailers will capture more than 85% of sector economic profit. That’s not a forecast of the death of stores, but it sure is an obituary for unremarkable retail.

It’s easy to see the joyful side of shopping as the squishy part of the argument. But that ignores the intensely human, soulful part of commerce, and it dismisses the harder evidence.

Prattle on all you want about frictionless this and seamless that. But then try explaining the Birkin bag, or the Masters merchandise tent at Augusta that does $70 million in seven days, with no website, no app, no loyalty program, and then disappears for a year.

Franklin Barbecue in Austin runs out of brisket most days and people line up before dawn anyway; the wait isn’t a defect in the operation, it’s the product.

Independent bookstores have grown for fifteen straight years. Barnes & Noble, written off a decade ago, is opening stores again.

Borough Market in London, founded in the thirteenth century, is packed with Gen Z every Saturday morning.

The generation that was supposed to finish off physical retail is the one buying vinyl, shooting film, and spending Saturdays at farmers markets. Not because they don’t know the frictionless alternative. Because they tried both and made a quality judgment.

None of that is sentiment. It’s revenue, foot traffic, and fifteen-year trend lines. The joy side isn’t the part of retail that resists measurement. It’s the part Andreessen’s frame and tech bro mindset couldn’t see.

Most of what we call “retail” today is really buying. Acquiring stuff. Replenishing stuff. Running the errand. Fulfilling a need.

Buying is a transaction, and a transaction is exactly the kind of thing that gets automated whether we like it or not. The logical brain is happy to hand the list to an agent while risking becoming increasingly subservient to our robot overlords.

Shopping is the other thing. Discovery. Belonging. The pleasure of being among other human beings. The hunt, and the serendipitous find. Fun, not merely satisfaction.

Buying is a problem being solved. Shopping is an experience a person actually wants.

That’s the part no algorithm gets to automate, because the whole point was to be there for it in person, for yourself.

As it turns out, absolutely something.

Quite a lot, in fact, just not the one thing the left brain dominant types like Andreessen were measuring, sitting there smugly, and rather ironically, in their Patagonia vests.

They saw a transaction point, and transaction points really were up for grabs.

What they missed is that the store was always doing more than one thing.

Those who know they can’t out-Amazon Amazon or out-Walmart Walmart are betting that the joyous, intrinsically human part of shopping isn’t going anywhere.

We’ve been gathering in marketplaces for thousands of years, and a chatbot is not about to talk us out of it.

But if you can't get clarity on what your stores are for, the retail graveyard is very likely where you're headed.

For fifteen years, Everlane sold one thing above all else: the truth.

Not just clothes, the truth about the clothes. The brand was built, brick by brick, on “radical transparency,” a phrase it used constantly and meant literally. Everlane named the factory that made the shirt, posted photos of that factory, and broke down the true cost (materials, labor, duties, transport) and then showed you its own markup, as if daring the rest of the industry to do the same. Sustainability wasn’t a layer bolted on later. It was the founding premise and the brand promise: we are the honest ones.

This week, Everlane sold to Shein.

Shein is the largest ultra-fast-fashion company on earth, and in nearly every respect the precise opposite of what Everlane spent fifteen years claiming to be. Everlane published its factory list; Shein’s supply chain is famously, and it would seem deliberately, opaque. Everlane made a moral argument for fewer, better things; Shein’s whole model is velocity, thousands of new styles a day, priced to be nearly disposable, tuned by algorithm for one outcome: buy now, buy more. Everlane talked about the planet; Shein generates the textile waste and carbon footprint Everlane built its brand to stand against.

The transparency brand is now owned by the opacity machine.

What a time to be alive.

How did the honest brand end up here? Well, follow the money.

Everlane had struggled for years. The deal values it at roughly $100 million, a number that exists mostly to clear about $90 million in debt. Common shareholders get nothing. A brand once valued near $600 million was sold to settle its tab. And in a sale process with few real bidders, a company’s values don’t get a vote.

A company can spend fifteen years building a set of values and mean every word of it. Soul can be worth a fortune, it’s most of what makes the great brands great. But it only pays while the brand is winning. Once the money runs out, the soul runs out of leverage. The gap between what a brand means to the people who love it and what it’s worth to the people who own it has rarely been this naked.

This week on the Remarkable Retail podcast, we sit down with Eric Sadi, Co-President, NA at Simon Property Group, to discuss why mall obituaries keep aging badly as Simon’s occupancy sits above 96%, tenant sales keep climbing, and anchor boxes give way to mixed-use destinations built for the human connection.

PLUS: standout earnings from On Running and The RealReal, renewed inflation worries as fuel and food costs climb, and GameStop’s bid for eBay hits a wall. Listen here or watch on our YouTube channel.

I’m excited to share that the Remarkable Retail Podcast is the official pod of the Commerce Next Growth Show. The Growth Show is where retail’s best come together to connect, learn and share what’s working, all in the heart of retail: NYC.

And we’re pleased to offer a special discount for our listeners. Retailers and brands get FREE tickets while others save 10% on General Admission registration using special code “REMARKABLE” at checkout. Go here for more info and to secure your spot.