Disney plans to close 20% of its stores by the end of the year and shift to e-commerce

by:Ennas      2022-02-04
On March 4, it was reported that Disney said on Wednesday that it would close 20% of Disney’s physical stores before the end of the year, thereby shifting to increasing the development of e-commerce business. The company said that at least 60 North American stores will be closed because of changes in consumer behavior and they hope to link the online shopping experience with Disneyland apps and social media platforms. Disney has approximately 300 stores around the world. Although consumers have turned to online shopping, the global epidemic has changed consumer expectations of retailers, said Stephanie Young, president of consumer products, games and publishing. IBM US Retail Index data shows that the new crown epidemic has accelerated the transition from physical stores to online shopping for about five years. In 2020, industry-wide e-commerce sales have increased by 32.4% to US$791.7 billion, and this number is expected to continue to grow. Disney plans to close one-fifth of its Disney stores first, and then evaluate other stores that may need to be closed. The company in particular sees Europe as a region that has significantly reduced its stores. The company declined to provide financial details on how the closure of the store will affect its performance, but pointed out that it will lay off corresponding employees at the same time as the store is closed. The number of layoffs has not been disclosed. Disney also declined to say which locations will be affected. It is worth noting that Disney’s other shopping venues, including more than 600 Disneyland stores, Target, Lifestyle and Outlet stores, as well as third-party retailers around the world , Will not be affected. Since 2019, Disney's cooperation with discount retailer Target has grown from 25 stores to more than 50. Target has set up a mini Disney store in the store. Disney declined to disclose its plans for future development locations. The company said it will improve its existing ShopDisney website and increase its product range, which will include more adult clothing series, streetwear, high-end home furnishing products and collectibles. Previously, Disney stores were often selected stores for children’s clothing, toys, plush and games. The Disney online store will be able to cater to a wider audience and expand its product categories. Disney expects to share more details about website updates and product releases in the future. After the close on Wednesday, the company's stock price remained unchanged. Since January this year, the stock has risen by 6%, and the cumulative increase in the past 12 months has exceeded 65%.
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