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Win, Lose or Draw: Brick-and-Mortar vs. E-commerce

Win, Lose or Draw: Brick-and-Mortar vs. E-commerce

So what do you think: Is the retail war over between brick-and-mortar stores and e-commerce? Or is there even a war at all?

Both forms of retail have been vying for your attention and dollars for years, with 94 percent of retail sales still taking place in physical stores. However, e-commerce holds its own with sales rising 17 percent annually over the past three years, and projected to reach $414 billion by 2018. Depending on what you read, there is no clear winner or loser, so to speak, in terms of which outlet wins the retail store war.

There’s also a cohesiveness that has emerged as a significant trend in retailing called a multichannel (omnichannel) sales approach that incorporates both in store and online shopping. That’s where we are right now.

“It’s essential to realize that it is rarely an online vs. offline battle, but a struggle that is won when we accept that it’s all just commerce and strive to bring the best of offline and online together on behalf of the customer,” writes Forbes contributor Steve Dennis

In the meantime, let’s take a look at the advantages and disadvantages of each channel and where the happy medium is found.

Win for Brick-and-Mortar

Shoppers still value physical stores so they can browse, touch items, make purchases immediately, and return or exchange products. For those reasons, consumers still choose to shop in stores, according to a consumer survey by Retail Dive. The study surveyed 1,425 U.S. consumers.

According to their stats:

  • Female shoppers especially want to see and use their tactile senses before buying.
  • Male shoppers lean toward immediate gratification of taking items home.
  • Younger and older generations want to see and try products more than their middle-aged counterparts.
  • Younger shoppers “want it now.”
  • One in five consumers say easy returns is the main reason for shopping in a store versus online shopping
  • Seven percent of respondents said online is the only way to go.

Technology may rule, but people still prefer shopping in stores because they consider it easier, faster, and more tangible than purchasing on a computer or smartphone.

Win for E-commerce

There’s no doubt it’s easy to click a button and buy something. If you don’t need the item immediately it’s a good way to shop because it saves you the time and effort it takes to go to a traditional retail store.

Another advantage of online shopping is that some stores don’t carry the obscure item you’re looking for. For example, if you need a specific type of charger for your old Garmin that isn’t carried in stores, you can simply buy it on Amazon. Or if you’re a fashionista on a budget and need a niche dress that only ModCloth carries, you go to their online store. Also, many e-commerce sites offer free returns, in part because Amazon requires their sellers to offer free returns.

 Lose for Brick-and-Mortar

Some think physical retail space is going belly up. In February and March, retailers cut 30,000 jobs, marking the worst two-month period of job cuts since the middle of the Great Recession in 2009. Plus, 10 percent of mall retail space is on the verge of closing this year, according to an article in Seeking Alpha.

The Seeking Alpha article goes on to say that as many as 8,640 stores may close this year, which outpaces the 6,200 stores closed in 2008. Why is this? He compares the phenomenon to home builders that built too many houses, condos, and apartments before the Great Recession in the years interest rates were low. Retailers did the same thing by building too many stores. Both markets are suffering as a result.

Lose for E-commerce

If your products and services aren’t easily accessible online and across multiple devices, business sales will evade you as well. An e-commerce website needs to do everything in order to meet consumers’ needs and be successful.

Put yourself in the customer’s shoes. If the website stinks, you could be sending potential customers to the competition. It needs to be mobile friendly, load quickly, provide quality images of products, and offer good customer support, to name a few. If online entrepreneurs don’t learn how to keep up with the demands, they will definitely lose business.

Shoppers also want a convenient shopping experience, so a mobile-friendly website is a must. Online businesses that use Google Analytics and know UX will provide users with a seamless experience.

Omnichannel Approach

The sweet spot is “bricks-and-clicks” or an omnichannel sales approach. A customer’s experience with a company, whether the shopper is using a desktop, mobile, tablet, or even shopping in a brick-and-mortar store, should be seamless. It provides the customer with an integrated experience. People are constantly using different devices, so marketers need to keep up and be proactive to meet the demands of customers.

E-commerce and brick-and-mortar aren’t separate. For consumers it’s simply “commerce.” Retailers and brands must use a strategy that embraces many channels to stay afloat and meet the demands of customers. The Gap figured out that more than half of their in-store customers visited their website even before walking into the store. People want to look at the merchandise online to determine if it’s worth the trip to the store. As you can see, technology and multichannel is simply a part of our day-today living. Just as stepping into a store is a vital part of the shopping experience. So, it’s a draw — there is no winner or loser.

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by Devin Morrissey // Devin has been a dishwasher, a business owner, and everything in between. He writes from his garage, occasionally rising to experiment on his friends' cars or do jumping jacks for no reason.

Opinions expressed by contributors are their own.