Michael Rubin, Fanatics Executive Chairman and co-owner of the New Jersey Devils and Philadelphia 76ers, says the licensed sports merchandise retailer Fanatics’ direct to consumer business model is largely driven by its e-commerce focus, telling the FOX Business Network’s Maria Bartiromo,“Our business today, it’s mostly online. It’s about, of our direct to consumer business, about 90% online and then 10% is operating the stadium, the stores at the stadiums, so we have about 40 different stadium stores that we operate.”
Continue Reading Below
Rubin weighed in on how the overall growth of e-commerce will continue to have an impact on brick-and-mortar over the next decade.
“The brick-and-mortar business, it’s going to be here in 10 years, but it’s going to look very different,” Rubin said on Mornings with Maria.
Rubin predicts a decline in brick-and-mortar retail over the next 10 years, “I think e-commerce is becoming so important, it’s becoming so much bigger [than] the actual numbers are. In ten years from now, brick-and-mortar retail will be smaller, there will be winners and losers, but brick-and-mortar retail will be smaller.” He continued, “I think you could see 30% less retail locations in a decade from now.”
Rising costs are also a factor weighing on the outlook for brick-and-mortar businesses.
“Meanwhile, you’ve got increases in labor so the business model of brick-and-mortar retail is definitely difficult. It doesn’t mean it’s going away, but it’s going to look very different.”
Brick-and-mortar retailers need to differentiate themselves to survive.
“If you’re a brick-and-mortar retailer selling the same merchandise that other people sell, you’re going to be killed by Amazon (NASDAQ:AMZN) and Alibaba (NYSE:BABA), you need to be different.”