Brick-and-Mortar Isn’t Dead Yet … And E-Commerce Tells Us Why
Despite predictions that the end of brick-and-mortar is near, we’re seeing more and more brands that are continuing to invest in it. Alibaba is just the latest e-commerce company to expand its presence into brick-and-mortar, with Square recently announcing its first physical shop location. These announcements come in the wake of Amazon.com's industry-changing purchase of Whole Foods.
What do all of these companies have in common? They’re incorporating elements that are elevating the customer’s in-store experience, and encouraging them to come into stores instead of just shopping online. This includes everything from virtual dressing rooms to mobile point of sale (mPOS) and endless aisle solutions that allow customers to conveniently check out from anywhere in the store, buy items online and pick up in-store, and purchase items to be shipped directly to their home.
Some researchers are quick to jump to conclusions and have been predicting the “retail apocalypse” for years, but others have had a more optimistic opinion that align with Alibaba’s perception of the state of brick-and-mortar retail. In fact, IHL Group reports that more retail stores will be opening than closing this year, with estimates of over 4,000 net stores opening in 2017 alone!
However, this isn't to say that large and small businesses alike haven’t felt the pressure from online shopping. The customer perception has certainly shifted and a traditional retail store is no longer the one-stop destination for shoppers.
The rise of e-commerce has sparked a major cultural shift that has changed how brick-and-mortar locations operate entirely, and this evolution is fueling personalization and a more enjoyable customer experience. Nordstrom is one of the first major department stores that has caught wind of this and is now experimenting with small-format stores that are focused solely on experiential purchasing. Shoppers can get free consultations with personal stylists to find looks they like, which will then be delivered to their homes, as well as enjoy other amenities such as manicures, tailoring and refreshments.
This isn’t something new, however. Digital-native brands such as Warby Parker and Bonobos have been doing it for years and realized that brick-and-mortar locations still play an integral role in the customer experience. Even Google has opened a physical store location, which sells Chromebooks, Nexus mobile devices, and displays and interactive exhibits that show how Google’s services work.
To drive the perfect experience for customers, all of these successful brick-and-mortar stores have one common theme — the inclusion of modern technology. This includes virtual dressing rooms powered by augmented reality and the “endless aisle” concept for consumers who like the convenience of being able to see exactly what inventory is available in-store and take advantage of buy online, pick up in-store options.
Furthermore, mPOS technology has played a crucial role in collecting valuable information on customers and making checkout quick and easy from anywhere on the sales floor. A recent study from eMarketer found that mPOS transactions are expected to total $49.29 billion in 2017, up 78.1 percent from last year, showing that this is a trend that's only going to grow in the coming years, and will likely ensure brick-and mortar stores won't be replaced by e-commerce.
The customer experience is a vital aspect for both e-commerce and in-store shopping, and it seems apparent that both have a very synergistic effect on one another. E-commerce giants have taken note on the value of physical locations, while successful retail stores have had a dramatic shift in the way they retain their customers. Brick-and-mortar is far from dead — all you have to do is look at the trail e-commerce is leaving behind to see why.
Jeff Scott is the CEO of Infinite Peripherals, a provider of enterprise mobility solutions.