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Amazon reportedly looks into rolling out department stores

The idea may work if foot traffic returns to malls and department stores

Photo (c) RiverNorthPhotography - Getty Images
Is there anything Amazon can’t -- or won’t -- do? The giant of darn near everything is reportedly toying with the idea of opening department stores.

According to a report in The Wall Street Journal, the company is adding to its existing brick-and-mortar landscape of bookstores, grocery stores, and cashless convenience stores starting in Ohio and California. In regards to size, the stores won’t have the footprint of a traditional department store like Macy’s. It will most likely be closer to the size of a Kohl’s or T.J. Maxx store, and it may be featured in strip malls rather than traditional shopping malls.

Why department stores?

If you’re the largest retailer on the planet and doing it all online, why do you need a physical catch-all presence like a department store? That’s a fair question. If you've been tracking Amazon’s every move, there are lots of little clues the company has dropped leading up to this. 

Little by little, the company has tried to create niches for itself, including its entry into the high-fashion world with “Luxury Stores,” the wide array of Alexa-centered tech, and all of its little private label products ranging from luggage to cleaning products. Those alone may be enough to fill up a department store.

Amazon’s decision to enter the department store game comes at an odd time. Thanks to the pandemic, shopping malls and anchor stores like JCPenney and Lord & Taylor shuttered or went bankrupt, and others like Macy’s and Nordstrom have been putting lots of money into trying to bring back consumers who have moved their shopping online.

But there are those who say the time is right for Amazon. Even though physical stores took a bit of a hit during the pandemic, foot traffic has slowly returned. 

“People are absolutely returning and shopping in department stores,” John Idol, the chief executive of the Michael Kors parent Capri Holdings Ltd., told analysts on a conference call last month.

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