Guest Slot – Analysis Insider – Sarah Wilson

Fast-forward five years from now and the question being asked about pure play retailers will be how exactly do they survive without taking advantage of trading across multiple channels including physical stores?

Having no stores will be seen as a mistake.
Shoppers will find it rather strange that they can only buy from them online and not have the opportunity to also go into a store and experience the brand along with feeling the goods. The reality for retailers is that they surely have to maximise every opportunity and for this they need to utilise all the channels they can get their hands on.

In the same way that bricks and mortar retailers have fought back against online-only operators by developing e-commerce arms, our view is that online retailers will want to use bricks to give their brands that vital visibility.

The high street feeds our desire for retail therapy in a way that cannot be replicated in the virtual world. The convenience of the store experience is key to generating impulse purchases, which is very difficult to achieve online. Online brands simply cannot give their customers that same sense of satisfaction and reassurance that the physical outlet can provide.

High Street retailers are feeding this need for convenience, ironically using the very technology that threatened to sideline them a few years ago.  Smart-phone and tablet technologies are already starting to entice shoppers into stores, a trend which is set to continue, making it easier high street merchants to really compete with their pure play rivals.

Shops open up a new customer base.
The pure plays are also facing the pressure of needing to put themselves in front of more potential customers. They have a finite number put in front of them – chiefly through mail-outs and catalogues – and so the high street provides them with a great way to connect with a new set of shoppers. It is possible that without this High Street presence, their  online sales will plateau.

Not surprisingly, against this backdrop, there are already indications that the more progressive internet players are making moves into the physical space. Amazon for one has introduced city centre lockers as collection points for deliveries.

There are also rumours that Amazon, along with Google, is taking it a step further and looking at opening shops. If these successful operators are considering such moves then you have to reckon there is plenty of mileage in it. Online cycle retailer, Wiggle, and fashion site Net-a-Porter clearly think so as both companies have stated their plans to open outlets to complement their online operations. They join N. Brown that has moved its catalogue brand Simply Be store onto the high street.

Others have been experimenting with the physical space by opening pop-ups. EBay took this route late last year along with others like Supermarket Sarah that popped up in Selfridges store in London. Such moves could also provide a solution to those store retailers wondering how to squeeze some value from their unwanted square footage.

What we are witnessing is the evolution of retail, with traditional retailers going online and the internet operators going the other way on to the high street. Just as the former have faced great challenges adapting to the online medium, the pure plays will undoubtedly find their move into a new space equally hard as they shift into the world of bricks and mortar and all the complications that entails.

The real winners from this switchover will be those retailers that best deliver on the multi-channel model. It’s not about treating channels as add-ons. It is instead about an integrated experience for customers as they choose to shop across channels and increasingly look on pure plays as employing yesterday’s model.

Sponsored column by Sarah Wilson, retail specialist at consultancy Egremont Group

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