I heard of many retailers going (finally) online. I also heard of many eCommerce startups opening bricks-and-mortar retail stores. What’s happening? And why?
Retailers today are becoming more and more aware of the benefits that come from ecommerce. Is an online presence alone the true key?
Some companies believe the answer to that question is yes. However, while there is no denying the benefits of offering online services, having a physical store can be just as important. Below we will discuss benefits of both principals, and how the merging of the two is the true key to successful companies.
Are online retailers killing bricks-and-mortar stores?
Companies like Amazon have capitalized on the internet age by creating an online marketplace.
This feeds on consumers’ needs to have access to the things they want at the tips of their fingers. The ability to look through various items and purchase them online from the comfort of their home can be tempting to customers. Some even believe that large online retailers will be the end of small businesses.
However, that is very unlikely for a variety of reasons.
Are offline stores more customer-friendly?
Stores with a bricks-and-mortar foundation have key advantages above retailers that are only online.
Their physical presence provides credibility that most online services can never achieve. There is also an increase in purchases when people can connect with the product.
Additionally, street traffic can be a source of revenue that online sites have no access too. Let us look into each of these benefits in a bit more detail.
1. Bricks-and-mortar retailers are more trustworthy
Businesses with a physical presence are considered more credible than those that are only online due to the high risk of frauds, viruses, and hackers. Only websites with a very positive record of accomplishment, such as Amazon, can earn consumer trust so readily. In most cases, a prospective customer would rather not risk the potential dangers of internet transactions. However, if a website can show they have a physical store that it is connected to; it is now more likely to be perceived trustworthy.
2. Offline shops create better customer relationships
Consumers also desire to physically see the products they are planning to buy. A customer is more likely to purchase something they are unsure about if they can hold it in their hands or try it on; doing so creates a connection with the item that you simply cannot establish through the internet. People are also more likely to pick up items as a gift for someone else if they see it in person than if they were to stumble across the same item online.
3. Sometimes car traffic is better than website traffic
There is also the benefit of drive by traffic. Customers that otherwise would never seek out your business could spot it on their drive home and decide to stop in. In addition, due to the economy, more people are looking for cheap or free things to do with their time; many have taken to going for drives or window-shopping to fill their time. With that, the first step of business is accomplished – the consumer knows of your existence.
eCommerce and bricks-and-mortar are converging
Now, this is not to say that eCommerce is not the way to go. In fact, it is quite the opposite!
Both have clear and definite benefits. The key is to take advantage of both: a physical bricks-and-mortar store need an online shop and vice versa.
When you combine the two, you can take advantage of both the buyer that wants to examine and compare the product thoroughly before purchasing and the customer that is in a rush and needs something they can buy quickly right now.
Companies such as EBay, Etsy, Piperlime, the Gap Inc, Bonobos and Warby Parker have already successfully opened a physical location. Obviously, people still love buying offline, so why not?
So, don’t be fooled by the news. In 5 years time physical stores will have an online presence and online retailers will open bricks-and-mortar stores.
The convergence is already happening!