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How brick-and-mortar retailers can play to their strengths – Retailers Association of India (RAI)

How brick-and-mortar retailers can play to their strengths

As online shopping has surged, traditional retailers have lost millions in sales to so-called showrooming — when shoppers check out products in stores that they then buy from e-commerce sites.

How can traditional retailers fight Back?

Let us understand, what are the strengths brick-and-mortar retailers have

1)    Established Brand Name

2)    Customers

3)    Strong Relationship with suppliers

4)    Offline Retail touch points

Clerk Handing Shopping Bags to CustomerUsing the above strengths retailer can really innovate by making their stores in to extension of their online offering.  Retailers who have footprint across multiple locations can offer Web return in store, buy online and pick up at the stores, Store inventory mapped in the backend and Orders dispatched from the store where free shipping can be offered, payment booths and even drive-through customer service centers for online sales to their brick-and-mortar buildings.

The new connected customer wants convenience of Online as well as benefit of offline (instant delivery).

Let us consider Typical Shopper Mr. Sharma, an information technology specialist in Bangalore. He shops for items like clothes, electronics and even groceries online. But he also likes to receive his purchases as soon as possible. He placed his order on the eCommerce store of a food grocery retailer in the morning and picked up the order from a nearby branch during his 45-minute lunch break that day. And there were no expensive shipping fees.

In my opinion, this type of strategy will create disruption and will set be an offensive strategy against pure-play online retailers.

Unfortunately, stores have been portrayed as old school and an expensive-to-manage liability with several disadvantages. But the advantages of having a physical footprint are many.

One advantage is the ability to reach customers who pay with cash. As Cash on Delivery is perfected by online players and which is opted by many online customers.

Retailers can offer shoppers to order merchandise online and pay for it with cash at a store when they pick the item.

Another advantage Offline retailers hold over their online-only counterparts is same-day delivery and returns. If offline retailer offers store pickup for items bought on the Web, they can add a drive-through service that will allow customers to return or exchange purchases without leaving their cars.

Entire exchange process can be made fast and easy, when customer wishes to exchange certain products he fills the exchange form, selects new merchandise. Customers can meet an operations executive outside say Shoppers Stop store, He will provide a mobile phone receipt or printout, and the merchandise is exchanged.

The Store can push a drive-through service which is next of Buy Online and Pick up offline. Initially, we used to view the pick-up-in-store feature as a way to draw consumers into stores and encourage customers to buy more. Now, Stores would rather close the deal on an online order as soon as possible so shoppers do not go elsewhere or loose sales altogether.

Traditionally in mature markets the online orders for in-store pickup also tended to be much larger than typical in-store purchases, and that customers who picked up orders in the store visited about 50 percent more often than customers who shopped only in the stores.

Many retailers in the mature markets, let people place orders online and pick up items within a day at a selected location, forgoing shipping charges. The retailers say this option is especially popular with bulky items that do not qualify for free shipping, and for people in a rush.

Retailers can go even further by integrating the physical and online merchandise selections. They can combine offline and online inventory combined, which will increase the stock turn ratio. Customers can also be given an option to choose inventory from particular store for immediate purchase. If the product of a desired color and size is not available in that particular store or online inventory but available in the store which is in other city then order still can be fulfilled and customer is not lost.

If traditional retailers play to their strengths, I am sure we will definitely see Pure Play online players opening offline stores.


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