Teresa Sperti

Online Retailers Have Real World Envy

When you think online retailing, the world's best pure play brands like Amazon, Net-A-Porter and ASOS immediately come to mind. Many traditional retailers have watched and learnt from these digital pioneers, and even suffered at the hands of them, as their lower overheads and agility has enabled them to undercut and out manoeuvre bricks and mortar competitors.

amazon bricks and mortor But it seems the tide is changing – although online retailers have seen much success – for many pure play retailers something is missing. No matter how hard they try, the physical shopping experience cannot be replicated on the web. Bricks and mortar retailers also have a leg up or two on their pure-play counterparts when it comes to providing immediacy and flexibility in the delivery and returns department. So it seems that whilst things have been tracking along very nicely for online retailers they are looking to the real world to extend their relevance and amongst other things are launching physical stores.

Online Retailers take to the Streets
In February of this year, it was reported that Amazon is gearing up to open a Flagship store in its home town of Seattle. Whilst many ponder why Amazon would consider such a move – by having its own boutique stores, Amazon will allow consumers to interact intimately with a handful of key Amazon products – like its Kindle.

But Amazon isn’t going it alone. One of the US’s largest online men’s fashion brands, Bonobos, has recently launched eCommerce showrooms known as Guideshops to dial up the customer experience element of their offering. Through its new Guideshops, Bonobos is providing personalised 45 minute appointments to further differentiate its product offering and engage consumers with the brand. In a recent interview, the CEO of Bonobos, Andy Dunn, reinforced the importance of consumers need to touch, feel and experience the physical product before committing to purchase – particularly to reinforce the Bonobos brand promise of “great fitting clothing”.

Then there is the likes of Piperlime owned by GAP who has also launched its first physical presence in New York, which was inspired from dialogue with its shoppers. And the list goes on……

Online Retailers Focus In The Real World
When delving deeper into these and other online retailer “real world strategies” some interesting similarities begin to emerge.
1. The new trend is showroom – While better online merchandising and product visualisations have undoubtedly enhanced the e-commerce experience in recent years, it’s still very far from and may never replicate the feeling of interacting with products in a physical store. Thus to extend relevance and reach and tap into “offline” revenue opportunities, online retailers need a bricks and mortar footprint.

2. It’s about small / boutique stores – One of the key advantages of online retailers is that they have lower overheads than their bricks and mortar counterparts. It is clear from Amazon, Piperlime and Bonobos that the strategy is to focus on small boutique stores (rather than large formats) that provide deeply engaging and unique shopping experiences. This is the complete opposite to strategies of traditional retailers in recent years that have gravitated towards larger warehouse type formats.

A New Game On
In recent years traditional retailers have begun to differentiate their offerings through leveraging digital in-store to create more engaging / experiential shopping experiences. But the latest move by online retailers may mean that the last of the competitive advantages of traditional bricks and mortar retailers is under threat. In 5 years time, the big online retail brands, may dominate the high street – and again revolutionise shopping as we know it.

References
http://www.psfk.com/2012/05/ecommerce-behemoth-moves-offline.html
http://www.piperlime.com/products/new-york-city-store-opening.jsp


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Teresa Sperti Teresa Sperti
Company: Coles Liquor
Position: Marketing Manager - Digital & Loyalty

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