Think the jury is still out on the future of brick-and-mortar stores? Think again. The current era is one where anything and everything can be sold online. While there’s a large percentage of consumers who still prefer to shop the old-fashioned way, there’s a stronger argument suggesting that you’re better off switching to a digital storefront.
Brick-and-Mortar Vs Online
Today’s retail landscape is characterized by, among other challenges, cash flow shortages, staff turnover, and a consumer base that’s more focused on finding the lowest prices. It is therefore a wonder that the industry still managed to achieve a 1.4% growth in sales over the last year, isn’t it? Well, here’s the deal — online retail sales grew by 10% over the same period.
Said another way, it means that an e-commerce model offers 7 times the growth potential of its offline equivalent. That’s mostly because the former doesn’t limit your reach to your physical address. With that in mind, it’s worth looking at the other benefits of running an entirely-online store.
Why a Digital Storefront May Be Best
Besides making it easier to satisfy consumers’ need for convenience, an e-commerce store also brings benefits such as:
–Reduced overheads: Insurance, property taxes, utilities… these are just but some of the costs that an eCommerce model does away with. Not to mention that you won’t have to hire as many employees as is the case with a physical store.
–Flexibility: An online store costs less effort and time to update compared to a brick-and-mortar establishment.
–Marketing: Selling online allows you to profile customers based on buying data, which in turn improves the precision of your promotional campaigns.
–No schedules: E-commerce stores operate 24 hours a day, 365 days a year.
Digitally Native Brands that Are Excelling
Nothing better brings home the reality that the future of retail is online than the rise of digitally native brands. These are companies that were born and grown entirely online under a radically new business model. Specifically, they opted to bypass traditional methods of distribution (read brick-and-mortar stores) to ensure better control over their customers’ experiences. So in came the term D2C (direct-to-consumer) retailers.
It does help that this is an age where consumers have a direct line to the brands they like. But why is it then that D2C retailers gained the upper hand over their legacy counterparts so quickly? It’s all because they understand how to leverage digital storefronts better than the latter.
Take the case of Bella Puzzles, a brand that specializes in personalized heirlooms and puzzle guest books. Asked why they chose the online route, the founder said a physical storefront would’ve been too limiting in terms of market reach. Etsy, on the other hand, offered access to a worldwide prospect base, and thus perfectly complemented the universal appeal of their products. Long story short is that the Bella Puzzles became a 6-figure business without the help of external capital infusion.
Sounds incredible, right? Well, it’s what happens when you combine a shrewd entrepreneurial spirit with a 21st century way-of-thinking. Such can be said of John Wood, the founder of US Wellness Meats. Although demand for grass-fed meat has been soaring, it’s hard to justify opening a physical store in what is perhaps the most sparsely-populated county in the US. As such, it was clear that online was the way to go — it expanded his market reach beyond the 75-mile radius of the business’s address. More crucially, it made it possible to build trust with buyers, specifically by answering product questions immediately.
So, would it be fair to say that online storefronts benefit consumers just as much as they do retailers? Absolutely. They make the brand discovery process easier irrespective of one’s location. That’s according to Erica Cerulo, who forms one half of the duo behind the trailblazing fashion startup ‘OfAKind.’ She says that the internet offers people outside of big cities the time and chance to uncover new designers. Her partner (namely Claire Mazur) concurs that an eCommerce was better poised to take advantage of the growth of online fashion communities.
In a nutshell, the one thing that digital native brands share in common is a great understanding of modern consumers’ preferences. While in-store shopping still has its benefits, they come at the expense of having to endure queues and crowds. Besides, it’s only a matter of time before technology makes the online experience as personal as its offline equivalent. Combining all these aspects makes it clear that there’s never been a better time to switch to an all-digital storefront.