However, there is also no question that competition from online retailers is presenting challenges and that store owners are going to have to adapt in order to survive.
Is adding an online store of your own the answer? Not necessarily. If you can't compete on price for the same products that are already available online, then don't even try. In my opinion, selling online only makes sense if you sell unique items or if you have a captive market. That said, you should definitely have a website that makes shoppers want to come to your store and you should definitely sell gift cards on that site to drive traffic your way.
You also need a facebook page where you post at least weekly and respond to every comment within a day. Otherwise, it will detract from your image rather than enhance it.
Back at the store, you need to carry products that can't be easily purchased online or that people want to touch and feel before they buy. Great examples of this are plants, clothing, bath soaps, and unique types of gifts. In other words, you have to give customers a compelling reason to come to your store to shop instead of purchasing online or going to a different brick and mortar store. That doesn't mean that you can't also sell items readily available online; it is just that those items won't bring people into your store. Customers won't come to your store just because they like you, either, although that is helpful!
So, yes, it does take more than location, location, location to succeed as a brick and mortar store today, but success is definitely possible if you are willing to adapt.