Most stores that go offline tend to be operating on a particular niche vertical market. It is not practical for online stores that operate on a horizontal space to go offline. For horizontal e-commerce, given the number of categories and depth, going offline would be a very expensive route unless they want to work on experiential selling or focus on a specific vertical example: jewellery, electronics, and apparels.
Given the challenges of trust, touch and feel factor, transacting online, product quality, Internet penetration and adoption, it will require quite an effort for online players to change their mind set and get the offline junta to join the online shopping bandwagon. Selecting produce, for example, can be a very sensory-oriented experience – consumers like to touch, feel, smell and even taste their selections before purchasing. Online grocery shopping limits that initial sensory experience, so we do everything we can to ensure they experience that same satisfaction each time they open their Door to Door Organics delivery box.
Today consumers research about products online but shop offline. In terms of buying grocery, there are a number of disadvantages to buying groceries online on both the consumer and business side, such as the cost and complexity of logistics, shipping fees, and the quality and freshness of orders. For online grocers to deliver the freshness consumers want, they have to be able to deliver orders fast while maintaining the quality of easily damaged foods like produce.
While online grocery shopping continues to gain popularity, the majority of consumers still rely on multiple online and brick-and-mortar stores to complete their weekly grocery shopping. Only 13% of survey respondents said a single store (online or offline) meets their weekly grocery shopping needs, while 34% shop at two stores during a typical week and 53% shop at three or more online and/or offline grocery stores each week.
Most e-tailers, who have adopted hybrid offline retailing, today are looking at the opportunity to build and grow the market fast along with bridging the consumer gap in understanding online retail. Keeping all these factors in mind, many e-tailers believe that this is not a fad but an evolutionary step for modern retail.
Online is just one of the channels of reaching out to the consumer. Hence, it becomes imperative for brands that are established in either channels to leverage the reach and advantage of the other channel. Looking at offline or online as silos will not be beneficial for any progressive looking brand. There are many synergies possible in the offline and online channels.
In the past, the trend for show rooming where customers browse and ‘try out’ the product in a physical store and then go on to purchase the product online was gaining popularity. This was seen as a huge threat to the brick-and-mortar formats. The e-commerce model offered convenience of delivery, promotions and discounts round the year and the ease of transaction. However, in the end, shopping has and will always be a tactile experience where all our senses have to be involved. The issue with e-commerce in its current avatar is that it only depends on the sensation of sight while the offline format, if done properly, can involve the sense of sight, smell and most importantly, touch, which is unbeatable.
In India, going multi-channel makes perfect sense. Homemakers sit at home all day waiting for their husbands. In the evening, they prefer going out with their family and would not want to sit at home buying groceries and appliances online. Moreover, we Indians like to haggle, negotiate, touch and feel before we buy larger products. Pure online does not allow that and it is geared more towards convenience rather than experience. Thus, the online-offline model works for India well and is not a fad.
Some retailers have also opened up to the hybrid model just to improve brand presence and experiment with customer experience like in the case of tele-shopping e-commerce companies have launched a ‘Virtual shopping wall’ at the Delhi International Airport’s domestic terminal to bring a different user experience to the offline model.
Increasingly e-tailers are using offline activation in one way or the other. Some e-tailers are opening stores to induce brand trial in a ‘touch and feel’ environment. Others have used marketing kiosks in malls and office spaces. Yet others have incorporated some form of ‘try at home’ for consumers before making purchase decisions.
The key reasons are: Experience: By coming closer to physical store experience, e-tailers are trying to make decision-making as easy as possible for the consumers. Awareness: Going offline is also to create awareness about their portal and proposition. Credibility and Trust: Being present offline gives not only credibility to players (specially the smaller ones) but also establishes credibility for their products. There are some categories where technology is yet to bridge the gap of trust or product experience, e.g. non-standardised big ticket size categories such as fine jewellery, furniture, etc.
Find players adopting hybrid models because shoppers too are ‘hybrid’ in their shopping patterns (they are not limited to only online or brick and mortar retailers). They engage with retail in both spaces and hence brick and mortar players are increasingly eyeing the online space while web-only players are eyeing the brick and mortar space to complement their online venture. According to SRS e-retail space is currently 3-5 per cent and will grow to 15 per cent in the next 5 years.
The brand should clearly outlay the reasons for foraying into the brick and mortar space backed by its offering and potential consumer. This would also be dependent on the quality of retail real estate that is available and its business goals. This should then be the basis for bringing a business viability of opening in smaller towns versus metros. Again, there are no fixed set of rules. A brand will have to map its own territory depending on its brand and business goals. It can never be a one-size-fits-all.
