How Amazon’s Retail Dominance Is Now So Complete That Traditional Retailers Are Rethinking Their Entire Purpose

A mid-sized American department store on a weekday afternoon has a certain kind of quiet. The hum of the fluorescent lights is a bit too loud. The same stack of sweaters that a salesperson folded an hour ago is being refolded.

When a customer asks if the store will match Amazon’s prices somewhere near the registers, the response is almost always in the affirmative. As this develops, it’s difficult to ignore something subtly significant: the store is no longer truly competing on merchandise. It’s fighting for survival.

Amazon did more than simply outsell other retailers. It changed the question that each retailer must now respond to. A store’s duties were simple for the majority of the 20th century: stock the shelves, hire employees, and complete the transaction. Because nobody had considered whether the friction of shopping was truly necessary, that model was successful. Jeff Bezos inquired. And the old presumptions started to fall apart somewhere between the introduction of one-click ordering and the first Amazon Go store, where customers leave without ever taking out a wallet.

Historians may view this as the second major unbundling of retail. The first was when mail-order and catalogs disrupted the local shop’s geographic monopoly. The second is happening right now, and it’s more bizarre because it’s not just about where you buy things; it’s about whether or not the act of buying needs to feel like buying at all.

According to a recent industry survey, 87% of retailers think physical stores will become more digital in the future, and 89% think they will be experience-focused. According to the survey, convenience was the most important factor. If a retailer didn’t offer it, one-third of customers said they would boycott them.

To its credit, Walmart appears to have read the room. By the middle of 2025, there were more than 200,000 active sellers on its third-party marketplace, which had grown by 34% in the fourth quarter of 2024 and added about 44,000 new ones in just the first five months of the year. That is a substantial amount. It implies that the moat that antitrust hawks once said was insurmountable is actually more akin to a shallow puddle in certain areas. By listing the same products on Amazon, Walmart, TikTok Shop, and a dozen other smaller platforms, sellers are hedging their bets in the same way that investors diversify their holdings. Quietly, exclusivity is dying.

However, there’s a feeling that Walmart’s comeback is more a recognition of the typical Amazon set than a triumph over Amazon. Bezos’s well-known empty chair at meetings, which served as a metaphor for a customer who was not present, was an idea so straightforward that it sounded like a joke. It wasn’t. It developed into a discipline. And now, twenty years later, every American retailer is attempting, in some way, to acquire that same discipline.

For the older players, this moment is peculiar in that it feels existential. Nordstrom, Kohl’s, and Macy’s aren’t businesses that struggle to make sales. These are businesses that find it difficult to justify their existence. You can match the merchandise. It is possible to match the prices. Delivery times are becoming more and more comparable. The cultural muscle memory that Amazon has developed over the course of three decades of unrelenting customer obsession is unmatched. Compared to a logistics network, that is more difficult to replicate.

Walking through a half-empty mall on a Sunday gives you the impression that someone is grieving. Perhaps it’s the time when retail existed. Perhaps it’s the belief that you could be protected by scale alone. Amazon disproved this, and the industry as a whole is currently figuring out what to do next, sometimes painfully and sometimes with unexpected inventiveness.