Why E-Commerce Brands are Moving to Brick-and-Mortar

We’ve all heard of the term “retail apocalypse.” When you hear that phrase, you probably imagine brick-and-mortar stores shutting their doors. But guess what? That’s simply not happening (if brands innovate!). In fact, the opposite is occurring: e-commerce brands are opening physical stores, and fast. There are approximately 600 stores across the United States that belong to former online-only brands! Let’s explore why.

Online Saturation – and Expense

We probably don’t need to tell you that the online market is saturated … really saturated. Approximately 77% of marketers use at least one social media channel to market their business, and the overall organic reach you’re able to obtain on social media apps is falling as the platforms change newsfeed algorithms so users see more from their friends, and less from brands.

On top of the fierce competition in the world of online advertising, placing ads in the digital realm is also very expensive. In recent years, the cost for online ads on search engines and social media platforms has skyrocketed – it can be 10 times more expensive to acquire a new customer online than it is in a physical store!

Experiential Opportunities

No matter which way you cut it, an online shopping trip can only be so interactive. On the contrary, physical stores offer the added benefit of allowing shoppers to engage with products, interact with employees, and soak in the brand’s culture.

Brick-and-mortar stores are home to immersive experiences that will create a lasting memory for shoppers. For example, Casper, an online mattress store, is opening 200 physical stores so that customers can book naps and test out mattresses before buying. A creative, unforgettable in-person experience is priceless (especially when it includes naps).

Other examples of physical experiential retail include:

  • Nike Live Concept Store: The athletic brand offers personalized advice, in person, to align customers with the best possible products to meet their fitness goals.
  • Wayfair: The online furniture retailer is opening its first physical location in fall 2019, which will allow customers to meet face-to-face with design experts, try out furniture in person, and more.
  • Warby Parker: The eyewear brand saw huge success when it opened its first pop-up in 2013, and it now operates dozens of physical stores and claims it gathers the most valuable data in person, and realized retail isn’t dead, it just needed a “creative makeover.”

A Fruitful Fusion

Sometimes the perfect place for an online brand is in a physical store. Take Glamsquad, for example.

Glamsquad in CVS

Glamsquad, an on-demand, in-home beauty service, recently partnered with CVS to offer express versions of its services. This is a great way for the brand to meet new customers in person, especially those who may not yet be aware of the online brand’s services (why not fill your prescription and get a manicure?).

Another benefits for e-brands taking up physical shop has to do with returns. Instead of simply mailing back a returned item, customers may opt to return the merchandise in person at the physical store, which presents a valuable opportunity: the opportunity to make another sale.

Make the most of your brick-and-mortar store with Star! Click here to learn how Star and Cohub streamlined one candy shop’s inventory management processes.

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