Internet joins brick and mortar to produce strong retail market.

The much-talked-about surge in online retailing in 1999 caused many to speculate on the future viability of brick and mortar retailers. Why would consumers endure crowded stores and malls when it is quicker and easier and often less expensive to shop on we Internet? Why would retailers invest billions in real estate and personnel when they can connect to virtual shoppers at virtually no cost?

It was tempting to conclude that the Internet might mean the end of retailing as we know it. However, a closer look at the local and national retailing environment reveals that the outcome of the battle between on-line and traditional retailing will be an alliance of the two.

Recent brick and mortar retail openings by Gateway, Gazoontite and other dot coms are just one example of this new relationship. These e-tailers recognize that the convenience of on-line shopping is enhanced by the existence of an actual retail location. Shoppers have greater confidence when they know that a store exists where they can touch the product if they choose. And while consumers love to ship and receive gifts by mail, they prefer to return gifts in person.

Brick and mortar retail locations also provide a host of opportunities for image creation and the development of engaging marketing strategies. It is true that shopping entails some hassle, but more often than not, consumers view it as a form of entertainment on a sensory level similar to dining out or seeing a movie. Shopping is a pleasurable event that cannot be replaced on-line.

No location illustrates this better than Manhattan, with its one-of-a-kind array of retailers, people, architecture and attitude. It has always been a rare form of entertainment to simply walk down the streets of New York City.

Even with all of the hype over the Internet, brick and mortar merchants in New York and throughout the nation enjoyed a very strong December, with inventory moving well enough to enable Store owners to avoid hefty clearance sales - a boon for profits. Big box and discount stores had a strong fourth quarter. Consumers sought toys, electronics and decorations, while also preparing for possible Y2K emergencies by purchasing water, flashlights, batteries and other sundries. The arrival of a new millennium also prompted consumers to purchase above their normal price range at jewelry stores. While apparel retailers had a scare in early December, when warmer-than-normal weather depressed winter clothing sales, activity picked up when the temperature dropped.

Low unemployment, big gains on Wall Street and the expansion of the dot com community certainly contributed to the success of New York City's 1999 holiday shopping season. However, the strength of the Manhattan retail market goes far deeper than this. The city has experienced a phenomenal revitalization, from quality of life to long-term corporate investment, that will continue to benefit retailers for years to come.

Foreign retailers continue to choose New York City, which is known as an active and stable market, as an entry point for expansion into the U.S. Likewise, national retailers are locating in or expanding their presence in Manhattan, and helping to popularize formerly marginal neighborhoods such as NoLita, the Meat Packing District and the far West Side.

As the retailing potential of Times Square and Harlem is realized, Manhattan will be well positioned for the future, from 125th Street to the Battery, all the way to cyberspace.