Amazon and cheap Internet alternatives definitely have an impact but so does the demographic of hobby consumers. For example, my kids just aren't that interested in hobbies, RC, trains, etc., like I am and was. I know that isn't true for everyone but in general, it's a trend. I would love nothing more than to have my kids join a local RC club, fly or drive in a local school gymnasium during the winter months, then go to the field in the summer and be social. Maybe join the AMA etc. and be a part of something more than themselves, but they have other interests. Clubs and gatherings just don't seem to figure in to their generation.
They would rather collaborate online with like minded friends across the globe in some MMORPG. I think we've reached market saturation and information overload. There are just too many things to occupy their time.
The local train club is mostly made up of older guys. The same holds true for the RC flying fields. Malls don't seem to host RC car races any more.
Personally I'm something of a car guy, yet my kids could care less. My daughter is big into crafts and art but nothing from a true hobby store.
I think it's just change. Unfortunately we're aging and our ranks are thinning. The big thing my youngest son was thrilled with was his new 6TB hard drive. Hobbies just don't figure in.
On the plus side, my oldest son would like to get his son interested in educational hobbies and the like, with the latest being the bluetooth enabled RC cars on a track, sort of modern day high tech slot cars without the slot, so maybe its just skipping a generation.