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  • The Myths of Online vs. Bricks and Mortar Gain Recognition
  • Bricks and mortar retailing has many strengths that today’s ecommerce just doesn’t have. Based on findings from my 25+ years of researching strategic choices that businesses make, success comes from building on strengths. Online retailing also has its strengths, which traditional bricks and mortar retailers have been working to learn. Yet, ecommerce powerhouse Amazon and successful online sellers like Warby Parker have been opening physical locations, and thus, tapping the advantages that bricks and mortar offers, but online does not. And, when the traditional way of doing something still has advantages, it can continue to serve the market despite threats of potential disruption.

    Consequently, we see that value can come from integrating bricks and mortar with online shopping and advanced technology. Thus, most traditional bricks and mortar retailers need to build and enhance their digital capabilities. And, as online retailers embrace physical locations, they will have to learn the best way to combine their digital technology with the ways of bricks and mortar. Amazon’s entrée into physical stores brings aspects of the company’s online data expertise in that its stores display books with the entire cover, rather than just the book’s spine, facing outward toward the customer, resembling how the books are sold online, not how they are displayed in traditional bookstores. But, just as traditional physical store based retailers strive to learn about online, ecommerce businesses opening physical stores will have to hone their skills in aspects of the bricks and mortar side that physical retailers already know well.

    Myths can muddle the issue. Online is often perceived as the way of the future. Yet, it’s not exactly clear how true this is, since integrating online and physical stores offers many advantages. So, retailers must not be misled by the myths. Rather than being blinded by an excess emphasis upon online, they must find the right blend that combines technology with the ways of bricks and mortar.

    That’s why it’s great to see the myth busting effort by Shopping for the Truth. Affiliated with the International Council of Shopping Centers, as well as with the Wall Street Journal, where it has been running highly visible myth busting ads, Shopping for the Truth dispels myths about retailing, especially the myth that online selling is overtaking bricks and mortar. Its November 22, 2017 Wall Street Journal ad says, “Physical stores generate 90.7% of all retail sales.” It also dispels the myth that millennials do not shop in physical stores, pointing out in its full-page color ad in the November 20, 2017 Wall Street Journal that “Millennials do 70% of their shopping in-store.”

    In many ways, this information about millennials is not surprising. Granted, it counters the stereotypical impression of millennials as a generation so tied to digital devices that, of course, they want to do all of their shopping online. However, it is consistent with other myth busting information about millennials. For example, with their propensity for digital devices, millennials may be stereotypically perceived as wanting to do their reading electronically. Yet, research has shown that millennials actually prefer print versions of books. So, it’s important to remember that, although millennials do make frequent use of their digital devices, they have not given up on non-digital formats.

    In addition to its myth busting activity, Shopping for the Truth also advocates the use of technology in retailing. For a variety of technology applications in retail, its website presents data showing the level of interest shoppers have in each technology. And, this information indicates that many shoppers have an interest in the technologies. Thus, Shopping for the Truth is advocating an approach that integrates bricks and mortar with online retailing.

    Interestingly, despite the value of integrating online with bricks and mortar, sales figures for the recent Thanksgiving holiday weekend might tempt some people to stick to the stereotypic view that online is the future and bricks and mortar shopping is dismal. According to information in November 27, 2017 Wall Street Journal article “Black Friday Crowds Thin” by Sarah Nassauer and Laura Stevens, holiday weekend sales were up 18% online, but down 4% in physical stores.

    However, based on other information I’ve been seeing about the integration of online selling with bricks and mortar retailing, these holiday sales figures do not necessarily support the demise of physical stores. Some of those items purchased online will be picked up in physical stores, some will involve returns or exchanges at bricks and mortar locations, and some of those online sales might never have occurred at all without bricks and mortar locations creating and reinforcing consumer awareness of the retailer’s brand, thus bringing traffic online to buy.

    Thus, the trend is toward integrating online with physical stores, not toward the demise of bricks and mortar. As this trend gets increasing recognition, retailers need to determine what blend of online versus bricks and mortar bests fits their strategy. They need to remember that even technology oriented millennials will shop in physical stores and partake of the advantages that bricks and mortar locations offer. At the same time, however, retailers need to offer the benefits that technology can bring. This means meeting the needs of their customers who favor technology, ideally without alienating their valued customers who might be slower to adopt the latest technology. The challenge for retail is to adopt beneficial new technology without letting technology obliterate the benefits of having a physical store. It’s possible that a physical location which becomes too much like online could encourage shoppers to stay home and use their digital devices without needing to visit the store.

    And, retailers with physical stores should consider taking steps to make shoppers want to shop in-store. Wal-Mart did this with some lower in-store prices. But, retailers can also do this by working to make the in-store shopping experience more favorable.

    Finally, it’s important to remember that one size does not fit all. Exactly how any particular retailer blends online with bricks and mortar depends upon the individual characteristics and strategy of its business. Nonetheless, integrating physical locations with online now appears to be the future of retailing. Much like what Shopping for the Truth points out, bricks and mortar on the verge of demise is merely a myth.

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