In this story from PLMALIVE! Len Lewis examines online retailing’s push into nbricks-and-mortar. Many internet marketers are also talking about opening physical stores to build their brand.

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From Online to Bricks-and-Mortar

It wasn’t long ago everyone thought online retailing was the future. It turns out that they’re not as unique as the bricks-and-mortar stores they compete with. Companies that started out as e-commerce pureplays have discovered that each channel depends on the other to increase sales and traffic, heighten brand recognition and to create a more seamless customer experience.

Moreover, with over 800,000 online stores, competition is fierce and expensive. And an online presence alone can be a big obstacle for companies trying to launch a new brand or reach new customers. In the last several years, more than 20 hardcore onliners have established physical stores in high traffic, urban markets.

Certainly, Amazon has been the largest and most publicized, and its first bookstore in Seattle last November was the opening salvo in what could be a nationwide rollout. But many others are now in the game.

  • Warby Parker, the online eyewear company, started by experimenting with pop up stores. It now has over 20 full time stores and may add another 20 premium locations.
  • Blue Nile, the discount diamond retailer and a major disruptor in the jewelry business, is opening small, low overhead  “Webrooms” that function as showrooms where in-store purchases are processed online via tablets.
  • Birchbox, a subscription-based cosmetics company with one million subscribers opened its first store in New York’s trendy SoHo neighborhood and two others will open this year. This hybrid strategy will enable Birchbox to fight off traditional beauty retailers like Sephora, Ulta and even Target and Walmart.
  • Rent the Runway, which raised eyebrows in the fashion business by renting designer dresses, opened its first New York City location in 2014 and now has others in New York, Chicago, Washington and Las Vegas.
  • Bonobos specializes in menswear. It has 20 “Guideshops” where customers can try on clothing and place orders for home delivery.
  • Asics, a sportswear retailer, has opened stores as complete running laboratories using technology like lasers and 3D foot mapping and offering free consultations that can’t be done online.

Store openings by online companies will continue. A study by McKinsey and Company says that consumers end up buying more when they buy online and pick up in stores. The bottom line is that consumers want to shop all channels and the answer is to create a retail ecosystem that melds all of them.

Retailers are long past the time that they can increase sales by just opening more stores. But as one observer put it—Stores are simply turning more browsers into buyers.

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Christopher Durham
Christopher Durham is the president of My Private Brand and the co-founder of The Vertex Awards. He is a strategist, author, consultant and retailer who built brands at Delhaize-owned Food Lion, and lead strategy and brand development for Lowe’s Home Improvement. He has consulted with retailers around the world on their private brand portfolios including: Family Dollar, Petco, Staples, Office Depot, Best Buy, Metro (Canada), TLW (Taiwan) and Hola (Taiwan). Durham has published five definitive books on private brands, including his first book, Fifty2: The My Private Brand Project. In 2017, he will debut his newest book, Vanguard: Vintage Originals, a visual tour of innovation and disruption in private brand going back to the mid-1800’s. Dynamic in his presentation while down to earth and frank in his opinions, he has presented at numerous conferences, including FUSE, The Dieline Conference, Packaging that Sells, Omnishopper and PLMA’a annual trade show in Chicago. Durham lives in Charlotte, NC with his wife, Laraine, and two daughters, Olivia and Sarah.