We have seen all kinds of reports which will tell you that the e-commerce industry is booming and it will also make you believe that the retail sector is dying. However, that is not the case if this new report is to be believed. Yes, a new report from CB Insights claims that investors are actually moving away from betting their money on the e-commerce industry. And guess what, they are actually betting their million dollars on the retail sector which everyone thought was dying.
According to this report and they also have numbers to back the claim, the investments in the retail sector increased year-over-year in 2019 whereas investments in e-commerce declined YoY in 2019. If we look at the numbers, there was an increase of $1.4B from 2018 to 2019 in terms of investments specifically in the in-store retail technology stores. However, the same investment decreased from $66B to $45B last year in overall retail tech.
The most interesting part here is that the overall retail includes e-commerce which are businesses that rely on online shopping and they contribute maximum in the decline towards overall retail investment. Now, we have always thought that the future of retail will be e-commerce stores but this report tells you something else.
We need to understand why this is the case and why everyone is investing in retail once again. For this, we need to note that investors have now realized that even if e-commerce is the future of the industry but you still need to have retail stores for the same.
Therefore, the long-term investment should still be on retail stores of those e-commerce stores such as Amazon Go and others. That being said, investors still believe that retail stores will advance and more technology such as cashier-less checkouts and other technologies will be added to it.