Ramanathan K | IIM Shillong
The Way out
A question that has been running through my mind for quite some time is, what would be the role of traditional Brick and Mortar (B&M) stores in this E-commerce world? E-retailing, even though it accounts for only 0.4% of the overall market in India, it is poised to grow from a ₹ 12,000 crore business in 2014 to a huge business of ₹ 1, 67,000 crore business in 2020. Today, we are increasingly been attracted, and habituated for various reasons, to online shopping as more and more products/ services are being offered online. Even Cars and houses are now being sold online! With newer phenomenon like showrooming becoming more popular, what could traditional stores do to stay alive and differentiate against these E-commerce players? This is a very important and a pertinent question that every one of us will have to face and answer at one point of time.
The question should be analysed from two different perspectives: One from the eye of big brands with huge financial muscle like the Future Group’s Big Bazaar or Infiniti Retail’s Croma stores and the other from individual local mom and pop stores who do not have much financial power.
Omni Channel Retailing
The companies which fall in the former category have many physical stores all across India and the only way out for such brands to stay afloat is striving towards Omnichannel marketing. As consumers move seamlessly between digital and physical channels, even during the same shopping trip, the lines between online and in-store shopping is getting blurred, and reaching out to consumers through all possible shopping points is becoming imperative. Every marketer should remember that consumers are no longer entering a particular channel but always are there in the channel interacting with our brands. Omni Channel retailers should get out of thinking in silo about the particular channel and should start focusing on leveraging all the channels to provide a seamless brand experience. Future Group is planning to invest ₹ 100 crore over next 18 months to provide consumers a single view of its many brands across physical and digital channels. This completely now justifies the move by various companies to open up their own e-retail sites and offering Buy Online Pick In-Store (BOPS) option. Apple is known for its BOPS option where the customer can place the order online and collect it from the nearest store within hours after ordering. Customers should be able to shop online and exchange products at any physical stores. A lot of the stores are spending huge amounts infusing a lot technology to provide an easy, convenient and seamless shopping experience. Omni Channel Synergy is THE way out for these retailers to make their B&M stores relevant today. The toughest part is answering the question from the local mom and pop stores’ perspective. With very little financial muscle, for them to stay alive is to tweak their strategy to make it their store relevant to the locality they are serving. The biggest advantage for such stores is the ability of offering customized, personalised service and they should leverage this advantage to enhance the stickiness factor towards their store.
With all said, the major takeaway for every marketer should be that physical stores are relevant still in today’s context and henceforth will play an instrumental role in the growth of Omni-channel retailing.
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