How online-only retailers can sell in the physical world

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We often discuss how brick-and-mortar stores must become omnichannel, creating online and mobile presences to keep up with channel-agnostic consumers. But what about online-only retailers? They too would benefit from an omnichannel presence in the physical world.

Online-only eyewear brand Warby Parker recently opened its first brick-and-mortar store. Founder Neil Blumenthal says every brand must be both offline and online:

“This is the convergence of ecommerce and bricks-and-mortar. The idea that it’s one or the other is ridiculous. Ecommerce as a term will become obsolete in five or six years.”

But opening standalone shops isn’t for everyone. Online-only retailers enjoy cost benefits brick-and-mortar stores don’t: No rent or store overhead, no store staff, centralised inventory (or none at all), etc. So how might these retailers create a physical presence without losing their advantages?

Shoppable media

Paid media made shoppable via mobile is one way to create a concrete presence offline. Where once a retailer might have placed an ad meant to drive store traffic, now they can bring the store to the ad space. Explains David Elsner, manager, retail consulting services at PwC:

“What we used to have before is, here is something we have on sale; please come to our store and buy it. Now what we’re saying is we have this product on sale; buy it right this instant. That cash register is in their hand. They can make that purchase.”

Walmart and P&G, for example, partnered to open “mobile stores” inside 50 Toronto bus stops. Paid displays on the walls display basic P&G essentials like nappies, shampoo, and detergent. Commuters can scan a QR code to order the item and have it shipped straight to their home, with free delivery. Online-only retailers can employ the exact same strategy, attracting consumers to their app via paid media to read reviews, browse other inventory, see product details and videos, and place their order.

Virtual stores

Rather than open actual stores, some retailers are opening virtual “stores” in the form of shoppable digital fixtures. eBay, for example, is opening four “shoppable windows” in the next month in NYC, giving the online-only retailer a tangible outlet. The nine by two-foot digital displays are essentially giant touchscreen tablets, on which passersby can surf through pictures and details on 30 items from the new Kate Spade Saturday brand, and buy the products right there.

The eventual plan is to display these windows not just on their own, but inside Kate Spade (and other) stores themselves – giving eBay an in-store presence while taking the brick-and-mortar store digital. Explains parent company Fifth & Pacific’s chief executive, William McComb:

“This gives us the ability to produce more from our retail space… We would never be able to fit all those products in a store in the traditional way. These things would typically require an extra 10,000 square feet of store space. But through partnerships like this eBay one we could do this through stores that are 2,000 square feet.”

A store within a store

The shoppable windows create a virtual eBay store within a brick-and-mortar Kate Spade store. But some brands are going further, opening their own mini-stores inside larger retail footprints. Samsung, for example, is opening branded retail boutiques, called “Samsung Experience Shops,” in hundreds of Best Buy stores – the brand’s first physical retail spaces. The mini-stores let shoppers handle Samsung products, ask questions, and purchase the product without waiting in Best Buy’s general checkout line.

The concept is perfect for online-only retailers and brands, especially those who can’t afford or justify their own standalone retail spaces. And when the online-only brand adds credibility or exclusivity to the bigger retailer – for example, if Warby Parker set up boutiques exclusively within Nordstrom stores – both brands win.

Shoppable showrooms

Of course, there’s always the option for online-only brands to create fully-owned retail spaces, if they and make sense for the business. But full stores with inventory and staff may not be necessary – instead, brands can build shoppable showrooms with smaller footprints and fewer (if any) employees.

Previously online-only apparel retailer Bonobos now runs what it calls “Guide Shops” in some cities which act as try-before-you-buy showrooms. Shoppers can try on the clothing, then order it online from the site. David Fudge, Director of Consumer Engagement and Innovation, says that as the brand grew:

“Multichannel retail became inevitable. A lot of our customers don’t mind an online-only model, but sometimes they want opinions from friends and family before completing a purchase… Our Guide Shops help expand our visibility in a very strategic way.”

While Bonobos Guide Shops are staffed, many brands wouldn’t need sales staff to make shoppable showrooms work. Concept retailer Hointer lets men try on and buy (online or in the store) jeans with no sales staff at all, delivering requested items to each dressing room via robots.

However online-only retailers choose to venture offline, the important takeaway is the same for them as it has been for offline-only sellers: Consumers are channel agnostic. They want to interact with products everywhere, and in every channel. The brands that make those interactions possible are the brands that will win their wallets.

Written by Tara DeMarco.

This article was originally posted on the Bazaarblog

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