There's a "dirty open secret" in retail, and it's killing Macy's and Gap

Macy's,Gap,Nordstrom, andJ. Creware all battling plummeting sales.

It's getting harder than ever to persuade people to visit physical stores with the rise of online shopping,Forbescontributor Barbara Thau writes, calling falling foot traffic a "dirty open secret" in the industry.

The threat of online shopping is becoming particularly ominous for traditional apparel retailers, asAmazon cuts into the apparel-industry market share, posing a major threat to stores.

This has become a death knell to traditional retailers that have long depended on in-store traffic to keep sales afloat.

Macy's in Herald Square.Mallory Schlossberg/Business Insider

Retailers are now looking for ways to become "Internet proof," Thau writes. It's well-known thatmillennials are looking to buy experiences, so it shouldn't be too surprising that malls are looking for ways to add things that seem like experiences - like gyms or restaurants, as Thau points out.

As further proof of this trend, Whole Foods' latest venture,Whole Foods 365, is trying to turn its stores into a "hangout" destination.

Not all apparel retailers have caught on to that trend yet, though some brands have innately built community and experiences into their strategies.

Brands that have been able to translate shopping into experiences are the ones that are thriving - comparatively speaking, at least - in an otherwise difficult time. Lululemon hostsin-store classesand Nike hosts events like run clubs, both of which foster a sense of community.

A Gap on Fifth Avenue in Midtown Manhattan.Thomson Reuters

Macy's is trying to do something along those lines, too. The companyhas apparently realizedthat it needs to excite consumers to boost traffic.

Macy's CFO Karen Hoguet said on a recent earnings call:

"Let me start with we absolutely agree with you that we need to work hard to make the bricks-and-mortar experience a lot more exciting, and we're working on that and trying to test some concepts, one of which actually is the whole health and wellness."

Macy's istesting out a new prototypesection of a store in Ohio that will make shopping more experiential and upscale, with personal shoppers and a spa.

The department-store giant has alsolaunched off-price sectionsin its stores to help boost traffic, but it's largely annihilated its reputation as a premiere retailer and signaled that there are other problems in the apparel industry, likeincessant discounting.

(BUSINESS INSIDER)