America’s e-commerce giant, Amazon, got its start as an online bookseller in 1994, and now after over two decades, the e-commerce major has decided to blur the lines between online and offline world with its first-ever brick-and-mortar retail store in Seattle’s University Village in the US.
The store, called Amazon Books, looks a lot like a conventional bookstore. Its wood shelves are stocked with 5,000 to 6,000 titles, best-sellers as well as Amazon.com customer favorites. Though, the store might look like an old-fashioned book store, Amazon says that it won’t entirely be doing things like a traditional store, however; it’ll be relying on Amazon.com data — including customer ratings, sales totals, and Goodread’s popularity — to decide which books to stock.
For years, the retailer has threatened physical retailers on price because it didn’t have brick-and-mortar locations. But those offline stores offered something Amazon couldn’t: the instant gratification of owning an item the second it was purchased, as well as the five-senses’ experience for customers.
Globally, the online retailers are looking to a future where offline and online shopping aren’t two separate business models. They are creating an environment where there will just be “shopping” and it will be an integrated online and offline experience.
Just like Amazon, the Hong kong based online fashion retailer, Zalora, recently embraced the importance of offline stores, but with a twist.
In April this year, Zalora, opened a pop-up store at the Windsor House shopping centre in Hong Kong. The offline store had racks of cloths, mannequins, and changing rooms, but cash registers and shopping bags were missing.The store, and shoppers are encouraged to scan a QR code to download the Zalora app to their Android or iOS device using the store’s complimentary Wi-Fi. The store opened on April 22nd, and while shoppers can see, handle, and try on clothing at the store, they don’t take it home. Instead, they purchase the clothing at the store, and it’s delivered to their home.
Once the shoppers’ stop comparing Zalora to traditional, offline retailers, then the logic makes sense.
In the current retail scenario, where developing an omnichannel identity is a must-do for most brick-and-mortar retailers, the rationale for the online retailers for adopting the reverse strategy (online to offline) holds relevance, and can also find imoprtance in some of the Indian e-tailers strategy aswell.
In the past few years, a slew of pure-play e-tailing companies in India, including Lenskart, Healthkart, Fabfurnish and Caratlane, among others, have already or are in the process of opening physical stores.
“For products that have a touch-feel element, the physical retail environment continues to be attractive for the customer. Also, an offline store can help to create more credibility and a more direct customer connect, especially in an environment where online sales are dominated by discounts and deals,” says Devangshu Dutta, CEO of retail and market analyst firm Third Eyesight, explaining about the reason why e-tailers look to have an offline presence.
For the five-year-old kids’ products’ portal, FirstCry, the offline store serves the purpose of providing a ‘touch-and-feel’ experience. “About 85 per cent market is going to remain offline even after five years, however hard we try to push e-commerce. Online shopping is convenient but it does not give that touch and feel experience, which customers in my segment would want,” Supam Maheshwari, CEO and Co-Founder, FirstCry, said.
Given the more engaging experiences that an offline store provides, experts too are convinced about the superior draw of physical stores.
“There are more offline consumers today than online ones,” asserts Harminder Sahni of Wazir Advisors.
“While retailers can choose to be exclusively online or offline, the consumers aren’t going to get classified like that. Consumers will shop across offline as well as online. Thus retailers will have to have a mix of both and find their own profitable balance,” Sahni concludes.
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