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Brick and Mortar Retailing in the Internet Age


July 5, 2016

Brick and mortar stores have advantages that the virtual world can’t match: opportunities for shoppers to touch, see and size up the goods and to walk away with a purchase. I know that many store owners think that customers come in to see products and pick their brains for information and then go home and buy on the internet. This may be true, but what are you going to do about it?

Maybe it’s time for all of us to think outside the box—retailers and wholesalers alike. With the Internet moving from its infancy into its adolescence, opportunities are opening up every day. I can see a time not too far down the road when retail stores will become show rooms and service centers. Customers will be able to walk into a pet store show room and service center and get expert advice, have a package of products tailored to their needs by that expert, who will do a quick internet search to provide them with the best price and most reliable fulfillment agent, and by the time the customer gets home, the product will be there waiting for them.

That’s not science fiction; it’s beginning to happen even now as I write this—just look at Amazon Prime’s two-hour home delivery service. So, rather than rail at the injustice of the Internet, maybe now is the time to become proactive and plan a new path for the retail customer’s buying experience.

I suggest doing a search of vendor websites to see who has shopping carts. If they are selling directly to consumers, is it generally at a decent retail price? Would you be able to partner with them as a fulfillment source for your store? How about your distributors, do they do fulfillment? Some do, and they might do it for you, too—if you ask.

Although outside our industry, an example of this approach is Best Buy stores. The last time I went into one was in response to an Internet ad for a desktop computer. I went in and walked to the back of the store where the computers are. I was approached by a sales rep who was knowledgeable and who actually showed me something even better than what I’d come in to buy. What amazed me was that the computer they ended up selling me was from a company other than Best Buy.

What Best Buy has done is partner with manufacturers that pay them commission. A brick and mortar store is limited by its square footage, but not if you can go outside the walls of the store and sell products from other companies. This scenario might be the wave of the future—to harness the Internet rather than fight it. Manufacturers produce more variety than a distributor can stock, and the average distributor stocks 20,000 SKUs—much more than your store can. Do you see where I’m going with this?

Also, there are still more customers that come into your store who want to take their purchase home that day. On the other hand, there are those who are just using you for product knowledge. I talked to a retailer who told me that when a customer comes into her store and plays the Internet card, she offers to match the price plus 15 percent to cover her cost of stocking it so they can have it right now. She always points out that her products are guaranteed against defects for a full year and she checks for hidden damage before the customer leaves her store. She said that most of the time, that customer will take the deal.

Manufacturers are beginning to beef up their MAP Protection, especially on high end products. Even if MAP isn’t a perfect system and can’t totally control Internet discounting, it will usually stop the deep discounting, making a negotiated price a very reasonable proposition for both the retailer and their customer.

I see the Internet becoming a tool more than a threat to brick and mortar stores. In the long run, we’re better off adapting to the new retail reality than trying to fight it. A great example of this is the printing industry. They used to have to typeset by hand; today it’s all digital and so much more sophisticated. Eventually, the same sort of transition will overtake the retail experience. Don’t look at it as a problem; think outside the box and create an opportunity instead.

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