Brick and Mortar Retailers vs Digital Retailers

5 Ways Brick And Mortar Retailers Can Avoid Turning Into Showrooms

By Staff Writer
In December 11, 2012
1779 Views

It was around this time a year ago I was visiting my sister and admiring her brand new 44-inch flat screen TV. Of course, I couldn’t help but ask her to describe (in detail) the purchase decision process. As it turned out, it was quite simple.

Cheryl and her husband went to their local Best Buy and spent considerable time with a very well-informed Best Buy associate. He helped them determine the best size, features, price range and brand for them. Armed with this guidance and having compared picture quality at the store, they thanked him and then proceeded to make their purchase from Amazon, saving money and delivery time. I said that this was a smart way to shop, not realizing at the time, that this “purchasing model” was beginning to keep brick and mortar retailers up at night. Best Buy not only served as a “touch and feel” showroom for their competitor, but their sales associate did most of the selling.

For brick and mortar discounters, department stores and specialty big box retailers like Bed Bath & Beyond, Staples and Best Buy, price, selection and convenience have always been at the core of their brand. Record-setting Black Friday sales of over 1 billion dollars online, followed by Cyber Monday online sales exceeding last year by 30%, demonstrate a growing re-definition of price, selection and convenience that could include brick and mortar stores as e-commerce showrooms only.

2012 Online Sales

Best Buy alone has 1100 stores in the U.S., at an average size of 45,000 square feet. That’s just under 50-million square feet of space to use profitably. While the longer-term answer might be to consolidate locations and develop smaller stores, what can these chains do short-term to bring more customers into their existing stores to purchase? Here are some areas where changes can begin to be made.

1. Retailers need to brand their concepts more like manufacturers brand their products. They must establish a clear target audience and a value proposition that they can uniquely deliver to that audience. JC Penney may have had the right idea in their re-branding, but the best parts of that new branding strategy were overshadowed by a pricing strategy that did not include special sales.

2. Retailers must focus more on the shopping experience that has been virtually disregarded in many of the big box concepts. New technologies can remove the traditional frustrations of shopping while adding some fun. As Kathleen highlighted in her Partners Riley blog, mobile checkout can eliminate the frustration of waiting in line and personalized entertainment can be provided through tablets placed in fitting rooms. Currently under development is the “magic mirror” that will show how clothes look on a consumer who simply stands in front of an LCD monitor – that’s convenience, selection and fun.

3. Sales associates need to provide more than what can be easily found online. They should be more personal, guiding customers based on their previous purchases much like Amazon is doing online.

4. Retailers need stronger, mutual partnerships with manufacturers to offer exclusive products and promotions and help build each other’s brand. If price is the only deal-maker, both sides lose.

5. Customer loyalty is old news. Retailers must use every touch point available to them, on and off line, to create customer advocacy. Traditional customer service, like standing behind their products, is far from enough.

Brick and mortar stores are not going away any time soon as people will always love shopping, especially the social aspects of the experience. Apple is a great example of how physical and online stores can not only successfully coexist, but feed off of each other. And even Amazon, the world’s greatest online retailer, recognizes the power of touch and feel and personal contact as they are now testing their own brick and mortar stores in Seattle.

With some of the above strategies in place, my sister may have felt a genuine affinity with “her Best Buy” and made the purchase with them as part of an on-going relationship with the brand.

Staff Writer

So who is this mysterious staff writer? Could be anyone really, as long as they meet our very strict criteria. 1) Worked with us in one capacity or another. 2) Have something pretty interesting to say. 3) Want to use our blog to say it. See? Told ya they were strict!