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The New York Times has a story saying that “more Americans are trading in their car keys for a keyboard” and that “online shopping is gaining at a time when simply filling up a gas tank to head to the mall can seem like a spending spree.” And many retailers – including Nordstrom, Target and Macy’s – are using free shipping promotions to encourage the move to Internet shopping.

“Retailers are walking a fine line in encouraging online sales,” the Times writes. “Of course, they are happy to attract more shoppers to their Web sites, but not at the expense of in-store sales — an important measure for investors. Then again, the Web can drive in-store business, whether shoppers go into a store to return an online purchase or whether they buy an out-of-stock item through a computer at the store.”

Still, the numbers are compelling, with some of these retailers seeing double-digit sales increases online even as they are seeing decreases in their brick-and-mortar shops.

Forrester Research projects that Internet will exceed $200 billion this year, up from $175 billion in 2007.

KC's View:
To me, the major disconnect in this story is the notion that retailers can determine whether people shop online or in-store. Shoppers make that decision…and as has been said here in the past (ad nauseum), all retailers can do is be where the customer wants, when the customer wants, how the customer wants, carrying products that the customer wants at prices that the customer deems to be appropriate.

The shopper decides. Retailers that resist this formulation will find themselves at a strategic and competitive disadvantage compared to those that do embrace it.