Brick or Click strategy: Is co-existence the way forward?

It appeared that a while ago, the e-commerce boom in India was here to conclude the popularity of offline retail stores. e-tailing, once a threat to the brick and mortar retailers, is now slowly but surely setting up offline stores to expand its presence. With users being at the center of everything, it seems as though customers want to reap benefits of both a touch and feel shopping experience as well as a one-stop-shop platform accompanied by the convenience of home delivery. The key question remains whether it is brick or click which will dominate in the long run or is it about building a hybrid retail model that has the best of both the online & offline worlds for today’s customer.

exchange4media spoke to brands in both e-commerce & retail chains to find out their views on an online vs offline marketing strategy.

Pepperfry: Will advertise where my user is

Digital-first brands such as Pepperfry, Myntra, Nyka, Urban Ladder and Health Kart are tuning into growing their physical footprints in ways traditional retailers haven’t yet imagined. The online furniture retail store Pepperfry is one such brand which adds to the experience of an online retailer by showcasing a curated range of furniture from its online collection. This helps consumers get a first-hand feel and understanding of how the furniture will actually look when placed at home. Speaking to exchange4media, Ambareesh Murty, Founder of Pepperfry, elaborated on the reasons behind adopting the offline advertising medium of Studio Pepperfry. He said, “It is the duty of every business to ensure that it is present wherever the customer wants it to be. My customer is sometimes online, at times offline and then on mobile sometimes. I will engage with my consumers as per the platform they access.” This clearly proves that the merger of online and offline is imminent as the customer wants the best of both worlds.

Online going offline

After a successful 5-year online stint, Falguni Nayyar’s Nykaa has also expanded their footing offline with an objective of being an Omni-channel destination in the beauty and skincare segment for its customers. Recently, Nykaa launched yet another brick-and-mortar store in Delhi at the Chanakya Mall by the DLF Group, adding to the existing tally of 20 stores in India. Online fashion portal Myntra too is looking forward to expanding on its current offline presence by increasing its brick-and-mortar store count, as it would help them strengthen the brand and further leverage their brand value. It seems as though, the once native-only online players are now trying to integrate various marketing-mix in order to provide their users with a seamless online-to-offline experience.

Timing matters

With the rise of online entities wanting to undergo a multi-channel experience, a few of the advertisers and marketers exchange4media spoke to had a different perspective to share. With respect to online brands some experts were of the opinion that those dealing with e-commerce should consider moving into high street markets only after cementing a strong and profitable market position within the online industry. This would help them negotiate better with retail partners in order to include their wares in the stores. Amazon’s India story is a shining example of e-commerce success which now aims at leveraging the offline presence of several retail stores across India to augment its last mile delivery network, this under the Amazon Easy umbrella, an India-specific innovation.

Amazon India’s story

Speaking to exchange4media, an Amazon India spokesperson said that their Amazon Easy initiative will help them experiment with physical retail even better. Through this channel they are able to equip offline partner stores with training materials such as browsing and navigation on Amazon.in which will further help customers set up Amazon accounts, make payments, answer status-delivery related queries and request refunds and returns if need be. Customers can also walk in to the neighbourhood Amazon Easy store for assistance while shopping on Amazon.in and choose to pay with cash on delivery or swipe their cards at the store itself while placing orders. “Amazon’s assisted shopping for users which pans across 14,000 stores currently also opens up self employment and other job opportunities for semi-skilled and partially skilled people," says the spokesperson.

Offline going online

On the other hand, we also have the once offline-only retailers speeding up in the race to keep track with online entities, taking competition to the next level. An example of such a deal is that of Walmart, which acquired a 77 per cent stake in online brand Flipkart, for $16 billion, making it perhaps the largest acquisition in the country. There is a bevy of foreign firms investing in India with the recent one being the Swedish furniture giant IKEA, which recently set up its first store in Hyderabad. The Swedish retailer also plans to open more stores in India by investing around Rs. 20,000 crore in the country.

IKEA in India

Speaking to exchange4media, Per Hornell, Head of Maharashtra Market, IKEA India, cited a few specific reasons behind their plans to go online even after a strong offline presence. Referring to the fast evolving e-tailing market in India, Hornell said that in addition to online, a brick-and-mortar concept would help IKEA to expand its reach with home furnishing offers at an affordable price for all. With changing consumption patterns, rising disposable incomes and the dining out culture, India’s retail landscape is thriving today and attracting significant investments. Hence, it is crucial for IKEA to invest in a tailored mix of sales channels such as, stores, online via web, mobile and pop-up stores, thereby being part of each of these markets and maximising reach, claims Hornell. So here again, the need of the hour is to collaborate the strengths of both mediums to make for a seamless experience for consumers.

Why the (Brick + Click) Model = A better fit

With the penetration of mobile devices and rapid technology adoption in India, consumers are resorting to varied consumption patterns, depending on their needs, inspiration and interests. With users taking to online shopping, offline retailers are innovating and going the extra mile for their users. While high street markets not only help brands boost their presence on ground, but also allows them to have an edge in logistics and distribution, online players come with a wider catalogue, better positioning and branding in the market, with a relatively frictionless customer experience to begin with. Keeping in mind what the industry experts have to say, it seems imperative that both online and offline players pull their weight and play to their full strengths and capabilities in the emerging Indian retail landscape.