I use both online and local retailers. I have no problem supporting a local LDS but only when they can be competitive (and they can if they want to) and if they actually provide the customer service that warrants a slightly higher price.
Example - we spent $6,000 in less than 45 days in a local LDS - 1 item (Oceanic Geo) had a problem. The problem was pretty serious - the computer was telling us we were at elevation 2 when in fact we were near sea level. Only 1 of the 2 we purchased was doing this. I called Oceanic who told me to work with the local shop we bought it at (Yes - they are authorized dealers etc). We went in to the shop - this was within 10 days of the purchase and the computer had NOT been in the water - and the owner of the shop told me we would have to deal with Oceanic and send it to them. The shop had about 40 of these sitting on the shelf and they refused to help us. Again - this was within 10 days of a significant purchase of regulators, computers, wetsuits etc ALL at full MSRP. Needless to say they have yet to see another penny from me - another LDS does see some of our money but so do online retailers. BTW - Oceanic was great and fixed the problem with a replacement and even flashed the other computer to be sure the firmware versions were the same!
Another LDS in our area has recently started on "online" store to compliment their brick and morter location and they are actually very competetive with Scubatoys and LP. This tells me they are paying attention to what I and many other divers want and they will continue to see more and more of my money. They will also still be in business in a few years. Others in the area I fully expect to see "going out of business" sales sometime in the future.
Bottom line - give divers what they want and you will get their business - don't and they will soon find a business that will.