IMHO, the issue with local running stores is two-sided.
One side, MSRP on shoes has gone up a lot over the last decade. We're not longer talking about a $90-100 purchase. Most shoes are retailing for $110-130 these days (or more). The higher prices have forced consumer's hands to look elsewhere for better deals or coupons. Heck, even 10% off and no tax can save you $25 on a pair of shoes these days. Clothing is even worse. I went to my local running store (with a gift card in hand) to buy a pair of shorts. The cheapest ones in the store were $45. Meanwhile, I can find a number of $20-30 shorts on RW.
The other side is the running store side. I used to go frequently to spend gift cards I'd win at local races from either age group or overall awards. These days, a lot of the local stores started cheaping out and instead of giving you a gift card, you get a certificate that expires in 30 days that's good for say $15 off a "full priced" purchase. Of course, as noted above, $15 off of a $45 pair of shorts is still more expensive than what I can get every day at RW. At the same time, sales are almost non-existent.