LAS VEGAS—Rumors of physical retail’s demise have been greatly exaggerated, Hudson’s Bay Co. CEO Gerald "Jerry" Storch told attendees today in an impassioned opening keynote at the Shoptalk 2016 retail conference.

“Everyone’s saying, ‘The internet is killing store-based retailing… the future belongs to internet-only companies,’” Storch said. “The problem with this is that it’s all wrong.”

Hudson's Bay Company—the parent company of Saks Off Fifth, Lord & Taylor and Hudson's Bay—said last month that it will make significant investments in store renovations and technology after reporting healthy Q4 profit and revenue thanks in part to its real estate initiatives. The company is investing in stores because they continue to represent the nexus of the retail experience, Storch said today.

“The vast majority of sales still take place in stores,” Storch said, noting that non-traditional retailing still generates only about 9.8% of all transactions. “The internet is transformational, but it’s not yet transcendent. It doesn’t replace everything else.”

Storch outlined a future where physical stores and digital commerce fully converge in order to satisfy consumers’ omnichannel expectations and demands. He noted that between the myriad product ordering, fulfillment and receipt options available today, retail’s “all-channel universe” offers consumers at least 100 different viable combinations for buying and taking possession of an item.

“And we gotta do them all, because we gotta meet the customer’s needs,” Storch asserted.

The lines separating brick-and-mortar from digital will continue to blur in the years ahead as traditional retailers learn to thrive online and digital-first retailers like Amazon, Bonobos, Warby Parker expand into the physical world, Storch added.

“Physical stores will get a lot better at the internet, and internet-only retailers will come to the conclusion that they need physicality,” Storch said. “Then it’s up to the customer to find the all-channel retail brands that meet her needs.”