The concept behind building offline stores is simple: in comparison to online shopping, a real store emphasises convenience and simplicity. It's at the heart of "New Retail," which combines online and offline shopping utilising technology and data. Ecommerce platforms appear to be attempting to digitally change the 85 per cent rather than increasing the 15 per cent by entering into physical commerce and leveraging technology to improve inventory- and customer data management.
While the Internet has made inroads into India's heartland, the physical store continues to hold sway. According to a recent AT Kearney survey, brick-and-mortar stores account for 95% of all retail sales, whereas two-thirds of online buyers visit the store before or after making a purchase. Others are combining 'bricks and clicks.' In order to develop new retail models, retailers are attempting to understand their share of consumer spending as well as how their customers' search, shop, and buy. Simply defined, successful retailers provide a customer experience that matches or surpasses customer expectations, according to the KPMG survey. Leading merchants make the most of their physical locations to maximise experience per square foot and in-person encounters with customers
Reasons why E-Commerce Giants Now Hold Physical Stores
1. Strategic growth: Opening physical stores and shops allows companies Amazon and Birchbox to appeal to new customers, particularly those consumers who currently shop elsewhere online.
2. A personal touch: Physical stores provide an in-store experience, including face-to-face human contact, which strengthens relationships with consumers and helps in building trust in a brand.
3. A physical touch: An in-store experience allows customers to touch and try on items like apparel, eyewear, and cosmetics, which buyers may return more frequently due to poor fit when purchased online solely. In addition, an in-store (rather than solely online) encounter provides shoppers with a deeper purchasing experience by appealing to all of their senses, which is something that e-commerce lacks.
4. Multichannel options: Physical storefronts allow merchants to provide a fully integrated service across numerous online and offline forms, catering to a wide range of consumer preferences and expectations.
5. Ease is in demand: By making it easier for customers to return unwanted items, physical storefronts assist e-commerce businesses in providing hassle-free returns. Physical storefronts also serve to expedite the delivery process by allowing for quick product pickup, all while saving retailers money on shipping.
6. Data-driven selection: As we all know, Amazon is a consumer data powerhouse that understands exactly what customers buy, browse, and return on websites. Now it can take those insights and apply them to its product assortment strategy in physical locations in order to boost sales by stocking shelves with items that customers want.
7. Showrooming is on the rise: By constructing physical storefronts, these companies encourage showrooming, which allows customers to see products in person before purchasing them online.
According to Time Trade's State of Retail Report, 85 per cent of customers prefer to shop in physical stores because they prefer to see, touch, and test things before purchasing them. According to the survey, one-third of customers prefer to receive product recommendations from sales colleagues, and 90% of shoppers are more inclined to purchase after receiving assistance from competent employees in-store.
Some Indian companies which have successfully pronged out into the offline space are:
1. MYNTRA
Myntra opened its first physical retail location for its lifestyle private label, Roadster, in Bengaluru on March 16, 2017. The offline store of Myntra provided over 8% of the platform's overall income. The store offers a complete brand experience, combining technology in fashion and lifestyle with technological advancements.
"Roadster grew at a fantastic rate of over 80% YoY when it first launched. Customers will get benefitted from an amazing brand experience enhanced by technology as well as a new shopping avenue as a result of this change.
Technology is a crucial component in these offline stores, and there is a distinct distinction between them and traditional brick-and-mortar stores. In the fiscal year 2016-17, Myntra made revenue of 2,000 crores, with Roadster accounting for a large portion of that.
2. URBAN LADDER
Urban Ladder, a furniture and decor retailing portal, was started in 2012 and now has three locations in Bengaluru. The stores, which are located in Domlur, Whitefield, and HSR Layout, have had over 50,000 walk-ins and have a conversion rate of 35% on average.
According to internal research, 21 per cent of customers didn't receive a comprehensive sense of the products online, which is why physical stores were opened. According to the data, 45 per cent of customers believe that seeing the products in person verified the price point of the offering.
Based on this information, Urban Ladder began designing and constructing various experience centres across the country, which will serve as the major distribution point for new product lines and collections.
Customers have a more immersive experience at physical stores. By delivering a memorable physical experience, they enable brands to create better ties with customers. Finally, offline and internet channels complement each other by providing consumers with several touchpoints. Customers are increasingly interacting with real stores via their cell phones. They make online reservations for products they want to try on in-store, and they also look at retailer websites while they’re there to make sure they don’t miss out on anything. Both the first and second point to the fact that offline and internet shopping play complementary roles.
Author Details:
Name: Anchal Agrawal
Batch: 2021-23
LinkedIn: https://www.linkedin.com/in/anchal-agrawal-b792a61a1
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