Ecommerce – Why Your Business Should be Online
The brick and mortar retail store vs online retail store debate has been around for quite some time, and the Coronavirus pandemic has added a new dimension to it. Online retail sales are at an all-time high and are set to grow. While its certainly not the end of brick and mortar stores, online sales have come a long way from being ‘just a fad’ and are rising at a steady pace. The COVID situation is here to stay for some time and has taught us a new way of life that is expected to become the norm in the next few years.
Let’s look at some stats first.
- By 2040, 95% of sales are expected through online purchases
- Nearly 60% of in-store purchases are influenced by ecommerce
- Nearly 50% of global customers say that they will continue with online purchases even after lockdown has eased.
- Nearly 20% of customers say that they would buy a vehicle online if there was an option to do so.
- The global retail sector is set to sustain a loss of $2.1 trillion in 2020.
- Multichannel retailers outperform online-only stores with total sales growth of 53% (nearly 80% growth in their online sales)vs 10% respectively during May 2020.
An interesting note – traditional retailers like Target and Myer provide online sales too. And online retailers are opening up brick and mortar stores or pop up stores in response. Successful retailers are moving towards using both modes of sales.
E-commerce vs Retail – A Comparison
Shopping Experience for a Customer
Let us see how the shopping experience differs for a customer at a brick & mortar vs an online store.
- Product Interaction
Ecommerce: Images, videos, and descriptions for product information
Retail: Physical interaction with a product
At a brick-and-mortar store, buyers can physically interact with a product to determine if it fits their requirements. It helps in making a faster buying decision.
With ecommerce stores, physical product interaction is not available. However, customers can learn about products with high-quality images, videos, and product descriptions. With evolving technology, there are many interactive options like 360-degree views and virtual try-on, for a full product interaction.
- Customer Interaction
Ecommerce: Speak or chat with human customer service representatives during customer service hours or chatbots after hours
Retail: Communicate face-to-face with an employee
At retail stores, you can talk to a service representative face to face and get instant answers.
E-commerce has great service options too. Customer interaction is available 24 hours, with some companies having shifts of employees working around the clock. Many companies have chatbots to answer basic questions after service hours.
- Shopping Hours
Ecommerce: Shop 24/7
Retail: Shop only during store hours
This is one of the greatest advantages that e-commerce retailers have over traditional brick and mortar stores. At retail stores, customers can only shop during store hours. The sales time window is limited to your store hours.
With ecommerce, customers can shop online anytime, according to their convenience. All they need is an internet connection and a computer or mobile.
- Shop Proximity
Ecommerce: Buy products from anywhere.
Retail: Need to travel to the store.
This is another advantage that e-commerce retailers have over traditional stores. Even before the current COVID situation, the need for travel to a shop could turn a buying decision from retail store to an online store.
Customers will look for maximum convenience, and online purchases give them the comfort of shopping from their internet connected devices within the comfort and safety of their own homes.
- Searching for Products
Ecommerce: Easy search for required products
Retail: Time-consuming and may need assistance from service representatives to find products.
Again, e-commerce scores over retail stores when it comes to searching for a product. At a retail store, customers have to search through aisles to find what they need, or may need the assistance of customer service personnel.
With ecommerce, customers can easily type a product name into the search bar and find what they need quickly. With customizations and advanced technology, it is possible to streamline searches further for online stores.
- Product Comparison
Ecommerce: Fast product comparisons with technology
Retail: Product comparison takes time
At retail stores, customers need to physically inspect products to make a comparison of prices or specifications. Also, some products may have different brands available at different shops.
With e-commerce, online stores provide an easy comparison of product prices and specifications. Also, you can easily make comparisons from different sellers. The flip side is customers may abandon the product cart, if they find a better product than what you offer.
- Shopping Time
Ecommerce: Fast shopping
Retail: Shopping time is more
E-commerce has a faster shopping experience than retail outlets since customers don’t need to travel, and can search for a product faster, and make easier comparisons.
- Product Shipping
Ecommerce: Needs time fora product to arrive
Retail: Immediate possession
At retails stores, customers can take immediate possession of a product, unless they have placed an order for an out-of-stock item.
With e-commerce, the product needs to be shipped and takes time to arrive.
E-commerce giants like Amazon and Target do offer two-day shipping for fast delivery of products. Many online retailers also have local warehouses for popular products to get products to consumers as fast as possible. Many customers prefer to wait for a product to arrive as a trade-off for a fast shopping process.
Retail Seller Experience
Now, let us see how the e-commerce vs retail experience differs for business owners.
Ecommerce: Lower overheads
Retail: Higher overheads
This is a huge advantage that e-commerce companies have over retail stores. Rent, utilities and personnel cost are definitely higher for retail stores. Sure, as an online store expands, employee number needs to increase; but an ecommerce business owner does not need to invest in commercial space and associated costs for expanding an online business.
- Customized User Experience
Ecommerce: Allows for customization
Retail: The store is set the same way for all
A shopper’s online activity helps to form an idea about the shopper’s preferences. An online store allows for giving a customized experience according to the shopper according to this data. A customized experience helps in faster sales and easy conversion of visitor into buyer.
A retail store can be set only in one way considering the general convenience of shoppers.
- Ease of Scaling Up and Down
Ecommerce: Much easier to scale up or down
Retail: Expansion and scaling down is complicated
Drop-shipping allows a retailer to scale up or down sales easily. Also, expanding or narrowing down a product list is easier; you just need to tweak your product list on the site. This is especially useful during the holiday season, when sales go up rapidly and come down fast after the season. In a retail store, you need to physically expand or discard products and space to scale up or down.
- Tracking a Customer’s Journey and Gather Information
Ecommerce: Online tools can easily track customer behaviour and information
Retail: Customers are unwilling to provide information
With e-commerce, online tools can easily track the customer’s journey and also gather customer information. This helps in setting up a huge database of useful customer behaviour information. You can gain insight into which products are doing well, at what point cart abandonment happens, and where you need to improve the user experience to increase conversions and sales.
At a retail store, it is not easy to ask for email or phone number directly to a customer. A lucky draw coupon or similar offers can help you get phone no or email, but beyond that customers will be unwilling to part with information. You need expensive surveys or consultants to analyze customer behaviour.
- Sales Happen 24/7
Ecommerce: Sales 24/7
Retail: Sales during store hours only
A major advantage that online businesses have over retail stores, is that sales can happen anytime, anywhere. Customers can make a purchase online from the comforts of their homes at any time of the day. This gives online stores a sales window of 24/7, which is not possible for a retail store.
- Shopping Experience for Customers
Ecommerce: Better shopping experience for customers
Retail: Limited shopping experience for customers
A customized and easy shopping experience for customers means more sales, more customers come back, and more profits. Shopping experience for retail customers is limited to product interaction.
Now that you have seen the advantages of an online business, and how expanding online can bring you more revenue, you need to invest in a good e-commerce site.
Here are some quick tips to start on an ecommerce site
Decide on the Domain, Ecommerce, and Hosting Platform
Decide whether you want to buy your own domain. Either way, you also need to find a good hosting provider at the outset. Decide on the ecommerce platform you want to use like WooCommerce, Shopify etc.
Find the Right Theme
Decide on a suitable theme that matches your business personality. A customer will form a first impression from the way your site looks and performs.
Ensure Your Site is SEO Ready
You must invest in a good SEO strategy to ensure that you rank in relevant queries, gain more visitors and conversions to sales.
Get Some Groundwork Done Before the Launch
Before you make the actual launch, ensure that you have done some basic groundwork like, social media and content marketing, SEO etc.
Test thoroughly every aspect of your ecommerce site before going live. Do an actual transaction. Continue testing during and after the launch to find pain areas for the customer and set them right.
Get Professional Help
While there are ready themes available, it is a good idea to get experts in ecommerce sites do the actual heavy-lifting for you. This is crucial to ensure that your online store is in perfect working condition, and you can free yourself up to work on what is important for your business.
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