“About 92% of purchases in the year 2015 were made offline”, according to the data provided by the U.S. Department of Commerce.
Brick-and-mortar business models are here to stay with us. A huge demographic still makes purchases in retail stores encouraging eCommerce businesses to go offline.
We all are aware of Amazon opening up convenience stores across major cities, but it’s a giant, and it can afford to take risks and experiment.
Warby Parker — an eyewear brand — makes a better example. After three years of its launch in 2010, it set up its first physical store in 2013.
Many other internet-first eCommerce businesses are joining the fray. Examples include Casper, Peloton, Allbirds, Nasty Gal, ModCloth, and some other small and medium-sized businesses.
Click-to-Brick: The Trend of the Decade
This trend is called “click-to-brick”. It means that online brands are expanding their services to the “offline” market. Which means anything from setting up pop-up shops to renting commercial spaces in an effort to expand their ecosystems.
As a business owner, no doubt you are always on a look-out for opportunities to increase your business. If the majority of your customer base is local, then it makes perfect sense to open up a physical store.
Apart from the usual benefits of increased attention from your customers, this model might have some cost-saving benefits for you.
Let’s have a look at the potential benefits of setting up an old-fashioned brick-and-mortar store.
1. Reduced costs and taxes on shipping products
There’s no point in paying for the shipping charges if your customer lives just four blocks away.
Amazon is setting up convenience stores that are convenient for both Amazon and its customers. The giant spent $21.7 on shipping costs in 2017, almost double of what it had spent in 2015.
Setting up physical stores will prove not only cost-effective to business owners, but it will also add to the customer experience.
No more days of agony waiting for the delivery. It gives the option to the customer to pick up the product on their own schedule. This model is called “click-and-collect”.
2. Easy returns
What’s the best part of having a physical store in the vicinity? The guarantee that you could return the item if you are not completely satisfied.
This factor encourages people to buy more from you.
Click-to-brick also offers major tax savings on shipping costs as well. Imagine that a person makes three purchases from you in a month and returns all of them. You will be paying six times for the shipping cost while making no sales.
This could garner positive reviews for your business. We all agree that small business can have some complications in the return process. Not every business has the luxury to offer free returns with no questions asked.
3. Fostering impulse purchases
When a customer looks for products online, their searches are super-specific and targeted.
eCommerce websites have the option to show recommended products, but they are similar or related to the product the customer is considering to buy.
Physical stores present a different scenario. Here, customers might end up buying products that have entirely different utility for them.
Imagine a customer walking down the aisle with a perfume bottle in their shopping cart. They see a watch and make an impulse decision to buy it. This doesn’t happen during online sales unless the customer makes a mental effort to do so.
There are many techniques that you can use to set up your store which encourages impulse purchases.
4. Huge increase in customer loyalty
It’s your chance to show your regards to your customers. Physical stores have something to offer that the internet-based services don’t.
The human touch.
This survey conducted by Time Trade is interesting. According to the survey, about 85% of the 1000 respondents prefer to shop in stores. Also, 36% of them responded that they don’t like waiting for items to ship, and 30% liked receiving advice on making a purchase decision.
People like getting assistance from in-store associates, especially baby boomers and millennials.
Going from click-to-brick is your chance to outshine your competitors’ customer service.
The tactile nature of the physical-store also improves the customer’s buying experience. Apparel brands benefit the most from this set-up. We all are aware of the reasons why.
Toy brands are also catching up on this practice. Brands like Game Chest lets their customers take a demo of the toys before making a purchase. There’s a dedicated space for people to sit and have fun with the card, and board games.
You can also find out unique ways to present your products to the customers, and help them make the buying decision.
5. Gathering in-person customer data
No doubt online methods collect data are much faster and cheaper than offline methods.
However, the data collected in-person is a lot more insightful than the data collected online. “We have learned so much from face-to-face conversations, feedback that from a purely digital relationship probably would have been impossible to get,” states David Gilboa, the CEO of Warby Parker.
Offline data collection methods, such as the interaction between the customers and store employees give deep insights into the customer’s expectations, concerns, and negative experiences.
Testing the waters before making the leap
You will need to do lots of analyzing before making a decision.
Critical factors like available funds, your customer base, legal formalities, your objectives and goals will ultimately decide whether you go from click-to-brick or not.
It’s better to take this venture out for a test-drive. As Warby Parker did it.
Before investing in a brick-and-mortar shop, they launched a pop-up shop by converting an old school bus into a store on wheels.
Casper did the same thing in it’s 2017’s nap tour in Canada. It travelled from Vancouver to Toronto and gave people a chance to test out their mattresses.
Check out this guide to get an estimate about how much a pop-up shop could cost you and the massive benefits of setting up one.
If you are an online-only business, strongly consider going click-to-brick. It especially helps if the majority of your customer base is local.
A physical shop can turn out to be cost-saving for you in the long run. And with a physical store, you are sending an invitation to the people to visit your store who would deny to visit it in the online world.
What are the major reasons you would prefer to stay an online-only eCommerce business? Let’s discuss in the comments.