Retailers Are Blaming The Internet For A Retail Theft Surge That Might Not Be Happening; Media Is Helping Them Out
from the oh-look,-that-again dept
It’s becoming quite a theme: basically every industry is blaming the internet for anything wrong happening in their industry and the legacy media is more than willing to help out. The latest is the supposed “surge” in shoplifting and retail crime. You’ve probably seen the stories, and maybe the shaky video coverage of the big smash and grab runs at some big San Francisco stores. This is being leveraged by those retailers in a variety of ways, including in a push to roll back policing reforms, but also to attack the internet. We’ve talked about the problems of the INFORM Act, which is being pushed heavily by large retailers. If you read that letter (sent to Congressional leaders by a bunch of big retailers), it uses those stories of theft to say we need to pass new regulations about internet sales:
As millions of Americans have undoubtedly seen on the news in recent weeks and months, retail
establishments of all kinds have seen a significant uptick in organized crime in communities across the
nation. While we constantly invest in people, policies, and innovative technology to deter theft, criminals
are capitalizing on the anonymity of the Internet and the failure of certain marketplaces to verify their
sellers. This trend has made retail businesses a target for increasing theft, hurt legitimate businesses who
are forced to compete against unscrupulous sellers, and has greatly increased consumer exposure to
unsafe and dangerous counterfeit products.
Of course, if someone takes the time to actually dig into the statistics, it appears that the holiday shoplifting surge narrative mostly falls apart. Obviously, there has been some theft (and a few of those dramatic flash mob style smash and grab jobs), but the data suggests crime continues to mostly fall.
Recent news stories describe a shoplifting surge, but this narrative conflates an array of very different offenses into a single crime wave said to be cresting right now, all over the country, in a frenzy of naked avarice and shocking violence. Smash-and-grabs are awful, but they’re pretty rare (and already very much felonies). Nevertheless, a handful of viral videos and some troubling statistics from retailers and industry groups have set Americans on edge during the year’s most economically essential shopping season, wondering if the mall where they buy their Christmas presents might be next. The deeper you search for real, objective evidence of an accelerating retail crime wave, the more difficult it is to be sure that you know anything at all.
The first indicator that the theft-wave narrative may not hold water is that stories about it tend to garble terms and numbers. They pair broad statistics about the commonness of shoplifting or larceny of any kind with lurid descriptions of brazen armed robberies (which aren’t included in any shoplifting stats, because they are a different crime entirely) to illustrate a narrowly defined problem: organized retail crime. This is identified as repetitive, mostly nonconfrontational theft for profit, whose perpetrators strive to evade detection and keep each theft strategically below local dollar thresholds for felony larceny. Misdemeanors don’t attract law-enforcement attention, the theory goes, so criminals are able to strike again and again and flip their hauls to fences, who consolidate millions of dollars of stolen goods into inventory for online storefronts, where Amazon and Etsy and eBay shield them from detection and punishment.
And, indeed, the actual stats showed a decrease, and while they don’t cover recent months, the author notes, if there is an actual surge, it might be because of this stupid moral panic narrative that’s making the rounds making it sound like everyone is doing it:
So far, this dynamic holds true for much of the country, according to FBI statistics. In 2020, the most recent year for which data are available, reports of robbery and larceny fell off a cliff. If we see a big jump in the near future, especially in violent smash-and-grabs, it’s worth asking how much the recent media attention itself contributed to the spike. Research has shown that sensational news coverage can influence potential offenders to adopt highly publicized tactics in copycat crimes.
Of course, it’s convenient for retailers to play up these theft stories, because if it leads to laws getting passed that bog down internet retailers, why they just clear a path for these brick-and-mortar stores who haven’t adapted to the internet as well.
In fact, as that Atlantic piece by Amanda Mull notes, the National Retail Federation’s own survey numbers show that theft really isn’t that big of a deal:
Consider “shrink.” That’s the term retailers use to describe inventory losses from any cause—shoplifting, sloppy checkout practices, shipping errors, warehouse mistakes, or simple misplacement—usually expressed as a percentage of total sales. It can be very difficult for stores to determine how any particular piece of inventory was lost, so they are forced to estimate how much different kinds of losses contribute to their bottom line. In both 2019 and 2020, annual surveys of NRF members pegged the industry’s average overall shrink rate at 1.6 percent—for every $100 in sales, an average of $1.60 in inventory was lost. The NRF’s estimate of how much organized retail crime contributes to shrink is $700,000 for every $1 billion in sales, or $0.07 for every $100. Even by the estimates of groups lobbying lawmakers and the public to take the problem seriously, these types of crimes account for a tiny proportion of overall losses, on average. Paperwork errors and self-checkout machines are both far graver threats to inventory management.
But, that’s not stopping the retailers from using the narrative that is happily being pushed by the legacy media (possibly inspiring more such theft), as an excuse to try to pass more laws to hinder the internet. Can’t let a good false narrative go to waste, I guess.