I think they did realize it and tried as hard as they could and still failed. I was a Sears salesperson in 2003 and 2004. The whole operation took itself very seriously and embraced the internet and technology. They just… failed. I’d love to know how they missed because everything was in their favor.
Think of the kinds of people who vie for leadership roles at established companies like Sears was at the time. Those people aren't innovators and creators. They're management types, MBAs, bureaucrats.
And fair enough: When the ship is that big and there are that many people on board, you often don't want to "move fast and break things," because the downstream effects can be extreme. Now you've just broken a company that had been working for decades. You're incentivized to take small risks with high likelihoods of reward.
Of course, the problem is, at some point that becomes fatal. A balance can be struck, but it can be hard when the original driving force is long gone.
I'm even struggling to come up with counter examples where a major established company is able to successfully pivot when the business model that brought them success is no long as viable as it once was. Maybe IBM counts in that they still exist, although I'd argue they aren't nearly the omnipresent force they were back in the day. You could also count widely diversified companies, but I probably wouldn't because they never really have to try to pivot the entire business.
As you said, finding a balance is hard and maybe not truly possible.
Sony is perhaps a good example. Most of the product categories that they became known for, like radios, cassette players, analog TVs and VCRs, are gone, replaced by PCs, smartphones, Playstation and their media empire and industrial products like CMOS sensors that are everywhere. They've seen multiple times a major business segment sink beneath their feet, and survived.
Apple: suffered from Windows PC competition in the 1990s but came roaring back under Steve Jobs. They doubled down on high-quality design, user experience, and vertical integration, and even switched from PowerPC to x86 and ARM, and from classic macOS to BSD-based OS X.
HP(E): after stumbling with itanium, replaced its proprietary Unix server business with x86 and Linux.
Not just the internet for the Chinese portion. First the USA made this happen in living memory of many of us when they supported bringing China into world trade without trying to buffer the effects, nicely summarized here: https://www.npr.org/2025/12/29/nx-s1-5660865/why-economists-...
Consumer goods got cheaper at the cost a few million decently paying jobs and manufacturing capacity directly and due to second order effects.
Maybe in alternate history we could have saved some of this onshore manufacturing capacity but we’ll never know now.
They were too late... they delayed significantly... After Prodigy failed, "the internet is just a fad" was the prevailing belief in the mid-late 90's when they could have had an early lead with just an online catalog for phone orders to start with, adding HTTPS and online orders later.
Those who tell stories, rule society. Amazon's story of starting in a garage selling books to selling millions of things was just more interesting than Sears, which had been around for so much longer.
Amazon also wasn't like Sears, they depended heavily on 3rd party sellers to built their initial catalog. Sears didn't have 3rd party sellers until much later on. Amazon just leveraged those 3rd party sellers to figure out what they should carry and sell as Amazon down the line.
