It is a changing world. It sounds like your store was providing extra service, however either the students did not know it, or it wasn't good enough in their estimation to purchase at a premium price that included the value-added service.
Sometimes the fault lies in the hands of the retailer who does not communicate the value of shopping with them, they just assume their customers know it, or worse they don't understand it themselves.
During the year I purchase a lot of gifts from Amazon. It allows me to research a lot of products online and even read product reviews. I am not burning up a lot of gas or spending days looking at products. At Christmas time I can buy that special present for almost everyone at one source, pay for it all at once, have it wrapped and shipped individually using the stored address book, and the deliveries are tracked and communicated to me automatically. For example, just last week I sent a birthday present to my son-in-law. No was at home to sign for it, and Amazon sent me a note with instructions on how to contact USPS electronically and reschedule delivery. Also, Amazon provides me a history of purchases. There is a lot of value in all of this for me. I can go back and see what I have purchased for my kids in the past too.
Now sometimes I research online and then go look at a product in a B&M store. I expect that product to cost more, and I will purchase it if the price is not significantly higher than online. 20% is not significant to me. 50% is. If I want it shipped somewhere and they can't do that for me, then Amazon is my choice. Price, value, and convenience add up to where I buy.
On the other hand, I have spent thousands of dollars with a very specialized retailer in my home town. What they provide goes way beyond what any online retailer could provide. Yes it usually costs me 20% more, but I have peace of mind and someone who will easily resolve any kind of problem that may occur. If they don't have it, they order it. They understand my wants and needs and are always on the lookout for things I may be interesting in purchasing. Everyone in the store knows my name and what I like, and they treat me like a king every time I enter the store. And I am not one of their big spending customers. They provide very personalized customer-centric service to everyone who walks through the door. They treat me special and are rewarded with my loyalty as a customer. If I see something online that is in the realm of what they sell, I do the opposite... don't buy online, but call them. So it can go both ways.
Years ago auto dealerships were scared to death of the Internet. But they found out that customers would research online, but most wanted to come in and kick tires; and good sales people can sell to tire kickers. Now most dealerships see the Internet as a mechanism to pull consumers into their showrooms, not competition.