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Online sales: Friend or foe for traditional retail?

Published date: 25/10/2017 09:00

As we read that Swedish department store giant Ikea is overhauling its sales strategy to begin selling product on a number of big ecommerce websites, it seems that the dawn of the online sales invasion is no longer that. It’s a full-blown sunrise, and its rays are only set to burn brighter than ever before on the world of in-store retail and sales.

While the move comes is primarily due to a mixture of online demand and a fall in visitors to its out-of-town outlets, Ikea, as it stands, is not alone in deciding to amend its sales strategy to further incorporate online platforms. If we look past the likes of Amazon and Alibaba, which are exclusively online, every major retailer and grocer, from Tesco to John Lewis and Walmart, have to various degrees a defined online presence aiming to ease the lives of consumers across the board. It hasn’t been a speedy process, as stores have had to move beyond their age-old model of driving consumers to impulse purchases via endless lanes of products and confusing layouts, though there’s been a definitive movement regardless.

One thing that’s important to bear in mind when discussing the transition to online is that department stores were conceived of in a time when consumption was something people aspired to. Unlike today’s generation of consumers whose purchasing habits are far more frequent and ingrained into their day to day lives, the department store was designed for those with very different buying habits than today’s audience.

Despite the wide-scale move to online, all is certainly not lost for the department store. Maximising the space available and enticing consumers with features they can’t access via ecommerce sites is key to ensuring its survival. There are numerous examples where such initiatives have been successfully implemented to great success. Neiman Marcus in the US, for example, a major company that includes fashion retailer Cusp and outlet store Neiman Marcus Last Call, has added what it calls ‘Memory Mirrors’, essentially a range of mirrors that offer customers a 360-degree view of how they look in their chosen garment.

This concept can be taken one step further in that popular culture is also something that can be brought in-store. Liberty is an example that has time and again proven itself at the forefront of the shopping experience, providing initiatives sewing lessons for shoppers and local students. The recent announcement of the John Lewis Residence, an in-store apartment that shoppers have the opportunity of spending an evening in by visiting their Oxford Street branch, is another venture that adds value, and an element of the world outside, into the store itself, thus breathing life into the typical shopping experience.

Delivering on more practical elements that can only be achieved in-store is additionally an essential feature of the department store. Walmart has recently announced it will be streamlining its returns process in-store, vowing customers will be in and out in about 30 seconds when making a return. This is a benefit that the online only destinations like Amazon aren’t able to reciprocate, as they require shoppers to return items through the post. Such examples emphasise the advantage having a bricks-and-mortar outlet can provide.

There is no denying the strength of online, and the ease with which it allows consumers to do exactly that, from the convenience of whatever location they choose. As opposed to seeing this as a threat however, the answer is perhaps more akin to adopting a truly omnichannel approach, neither looking to use online to boost in-store sales or vice versa, and to instead use them in tandem, emphasising each platform’s own distinct features. Retailers may then be able to view online as a viable parallel channel, and not a threatening alternative.

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