Disney to close 20% of Disney stores as it focuses on e-commerce

Disney said on Wednesday that it will close 20% of its physical Disney Stores before the end of the year as part of a greater focus on its e-commerce business.

At least 60 of its North American locations will close, the company said, citing changing consumer behavior and a desire to link its online shopping experience to its Disney park apps and platforms. social media. There are approximately 300 Disney stores around the world.

“As consumer behavior has shifted to online shopping, the global pandemic has changed what consumers expect from a retailer,” said Stephanie Young, president of consumer products, games and retail. editing.

The pandemic has accelerated the shift from physical stores to digital purchases by about five years, according to data from IBM’s U.S. Retail Index. Industry-wide e-commerce sales jumped 32.4% to $ 791.7 billion in 2020, and that number is only expected to increase.

Disney’s plan is to first close a fifth of its Disney Store footprint and then assess where other closures might need to take place. The company looks to Europe, in particular, as a place to make significant cuts.

The company declined to provide financial details on the impact of the closings on its results, but noted that there will be an undisclosed number of layoffs that will coincide with store closings. Disney also declined to say which locations would be affected.

Notably, Disney’s other shopping experiences, which include over 600 Disney Parks stores, stores at stores like Target, lifestyle and outlet stores, and third-party retailers around the world will not be. affected.

Disney’s partnership with Target, which has placed miniature Disney stores in the discount store, has grown from 25 stores to more than 50 since 2019. The company has declined to share its plans for future locations.

The company says it will improve its current ShopDisney website and expand its product assortment to include more collections of adult clothing, streetwear, high-end home goods and collectibles. Disney stores tended to be a curated selection of children’s clothing, toys, stuffed animals, and games. Disney Online will be able to cater to a larger population and expand its offerings.

Disney is expected to share more details on its website redesign and product releases in the future.

The company’s shares were unchanged after the market closed on Wednesday. Since January, the stock has risen 6% and over 65% in the past 12 months.