online complementing traditional retail

Online-offline integration can help retailers meet customer expectations
Can online complement traditional retail?

Throughout e-commerce short lived history, countless observers have debated if online retail is going to make traditional physical store buying irrelevant. This question may have been settled a while ago as there is enough evidence to suggest that both online and physical formats coexist successfully. Still, there are ardent fans and supporters of both models, who will try and persuade you that one model is necessarily better than the other.

An interesting fallout of this online vs offline debate is co-opting of both models by existing retailers. While physical retailers have opened online stores since the earliest days of Amazon’s success; it has taken many years for the traditional retailers to understand the nuances of online retail and perfect them. Many large retailers like H&M, Marks and Spencer and Shoppers Stop have successful online stores.

It is not just pure-play retailers who are complementing their physical stores with online stores. Many manufacturers of consumer products – from car makers to luxury brands and technology companies also have established thriving online stores of their own.

Does this display superiority mean that online stores will be the preferred choice for consumers to make a purchase? The short answer is no. The reason is widely-known ‘research online, purchase offline’ behaviour, which suggests that most customers use online sources just for research, but when it comes to making a transaction, are happier doing so in a physical store. 

A Google India-Nielsen ‘Tech Shopper’ study conducted in 2012 found that more than 40 per cent of the in-store purchasers in metros and Tier I and II cities undertake online research before making a decision. More importantly, seven out of ten prospects have already made up their minds about what model to buy and what not to, before entering a physical store.

But what about that subset of customers who actually buy online? The goal of manufacturers or vendors should be to use their online store to deliver an outstanding customer experience – allowing customers to find and purchase the right product from their portfolio in the most simple and effective way. The safeguards deployed towards that end include selling at suggested retail prices – no discounts whatsoever – and not running any exclusive deals on the online store. This helps protect the retail partners’ interests and avoids any overlap. After all, the objective of a manufacturer is to grow the brand’s reach and help its customers make an informed choice. And that is how we can build and run an online store that actually complements our existing go-to-market strategy and adds value to the existing channel partners.

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