Is e-commerce going to a mixed, online/offline, model?

Jack Byer Cofounder at Stealth Startup

January 18th, 2016

You see tons of brands that started online now dabbling in having an offline presence - bonobos, warby parker, polyvore and even Storenvy. Is it purely brand building or is retail a model that just naturally has to have a mix of online/offline for one brand and what do people in commerce think is the right mix?

Steve Bowman Owner, BizClarity and Venture Capital & Private Equity Consultant

January 18th, 2016

"Omni-channel marketing" is the term. In the future, nobody will remember why we thought of offline and online separately. Big retailers are merging their online/offline pricing, promotions, databases, and management structure, etc. The idea is that a customer can fulfill any part of the shopping process either online, offline, or both. Apple is the model for this.

Of course it will take years for omni-channel marketing to tricky down to smaller companies, and there will always be a place for pure plays--but they'll be increasingly rare.

Thomas MBA ☛ Marketing ☛ Business Design ☛ E-commerce

January 18th, 2016

This trend is not new. It has a name: ROPO (Research Online Buy Offline). For some categories of products, typically those considered either ‘sensible’ (life insurance) or ‘expensive’ (cars) there is often a trend to research information online and buy offline. This trend may also apply to the clothing industry, particularly among certain target segments who visit clothing websites with an eye on ‘scouting’ out new fashion trends before heading to the brick and mortar location to try on the item. With mobile phones, this mindset has the potential to become even more relevant because of an increased connection between online research and the act of purchasing in the minds of consumers. In fact, research on mobile devices has the potential to immediately generate an offline sale if the right information can reach the right audience at exactly the right moment. For a retailer like Bonobos, the interaction between online and offline is highly relevant as a result of the desire of consumers to ‘try on’ clothing before purchasing their products (perfect fit matched offline and access to more choices online).

Aaron Goodin CEO and Founder of Tack

January 18th, 2016

Im a big fan of L2. Here is a clip they put out a few months ago with some data on the multi-channel trend of big brands.youtube.com/watch?v=0jVSBYo0Zbs

RICARDO GUERRA Diretor De Marketing na Giraffas

January 20th, 2016

The more we advance in the new days, the less general strategies will work everywhere. We are facing an era with less common sense. There are good exemples in companies working fantastic only online, offline or both. Try to find where in the consumer journey your business will work better. Size, market, service or product, mídia investments, if you are in a big or small city, everything needs to be consider defining your choices. Online or offline, the shopper experience is by far the most importante issue we should worry about it. We`ll make mistakes, learn and correct as fast as possible. Don`t plan it all, the world is changing to fast.

Dmitry Kroshka Marketing, Strategy, Partnerships

January 19th, 2016

Hi Jack, Here's what I've found in talking to enterprise brands as well as small startups. At the enterprise retail level, 93% of revenue is generated at the brick and mortar level. Some things we prefer to see and touch. Brick and mortar generally will see a "multiplier" effect of 3-4x on digital media, meaning, for every $1 converted in digital, they should see a $3-$4 conversion in-store from the same digital ad. Even Amazon is starting to recognize this, with a showroom being built in Williamsburg, Brooklyn. Apple proved the point that stores sell more product -- I believe they hold either the top or near the top spot when it comes to revenue/sq ft. for retail. Smaller retailers know that physical wholesale helps get their product in a place where consumers can touch and see it live, but also know that at some point you want a more curated experience to represent your brand, hence opening a store, especially in a high volume, high tourist, urban setting. Hope this helps. Dima

A. Andrew Chyne

January 20th, 2016

Yes, it has to be mixed. Retailers need to have stores for luxury and high-end products. Customers are likely to pay for a product in which they have tried rather than the one displayed in the retailer's website. Its online division can take care of products that are of regular requirements. For instance, if you are buying a pair of socks or handkerchief etc, these are regular needs of the consumer and buying such products online would save a lot of your time and money.

Anonymous

January 20th, 2016

What do you all think about this? wechat started this and now FB and others are trying to implement including the retailers themselves like Nordstrom etc.

https://medium.com/@chrismessina/2016-will-be-the-year-of-conversational-commerce-1586e85e3991#.vd9an0dl7

Rajnish Rohatgi Expert at "Strategy IN Action", in a world of "Strategy AND Action" and, even worse, "Strategy INACTION"

January 19th, 2016

Online market place platforms will increasingly provide only "price and product discovery" - for sellers/ providers who today don't know who wants their product/service and when! and vice versa. Fulfillment will increasingly shift to offline, at least in India, where lower cost, neighborhood, mom-and-pop stores are still very common.

A. Andrew Chyne

January 20th, 2016

Let me add one last point, nothing can replace a physical store no matter how advance e-commerce is.

Good Luck.