Brick and mortar is not dead yet

shopsLately there seems to be a lot of discussion around the death of the physical retail store. Some prophets are saying that e-commerce will eat them all.

Sorry, but I don’t agree here. In my opinion e-commerce is “just” another game changer for retail merchants. Ok, quite a big and fast one. But back in history we had some of them and with them always the vision of retail doomsday of some sort.
Mailorder was there to destroy local retailers. TV shopping also. The huge malls were the prediction of small shops going down. And so on. Make some research yourself.

It comes down to what it always comes down in business: innovation and adoption to the business environment. For businesses it was always the rule that those who do not adapt will die out. Those who do and innovate will survive.
All the discussion about pure players, multi-channelers and non e-commerce for me is somehow nonsense. They are all merchants, selling stuff to the customer. They do it via different channels. And that’s it. It doesn’t really matter what channels you use or don’t use. More important is that you know what you sell. That you bring something unique to the customer, be it consulting or good prices. I don’t like that much to say “niche”, since it’s often connected to small. But as a merchant you have to find your niche of uniqueness to survive, to be different from all the others.

What made me think about this topic was a purchase I made recently in a local store. Apart from all my other occupations (like writing for blogs) I work as a professional photographer. So once in a while I need to buy new stuff – in this case a new lens (we are talking about professional grade stuff at high prices here). So I did, what I would describe as the usual process. I went to the web, looked at price comparison engines, amazon and so on. Since I had this particular lens on my list for a long time, I knew pretty well in advance what the price would be. Then I went to the website of a local dealer, where I bought some of my gear back in time. Usually they are good in price, just a bit higher than the net, but that’s ok for me, because I get good consulting (niche of uniqueness), can try out the stuff and have some directly available if something breaks down.

What I did not expect was that: they simply had the best price. Better than the web, even better that I EVER saw for this lens in about two years. I went to the dealer and bought it. I also asked them how on earth they can do that (I mean they were 80€ less than the best dealer on the web!). The consultant (it wouldn’t be accurate to name them sales person) explained to me that they have one employee who doesn’t do anything else but monitoring prices on the net. With that information they can adapt their own prices and follow – or even lead – the competition. Online and offline. And together with their buying department they can make decisions and set prices dynamically. And they can live from that pretty good. Just to be clear: that is not a new dealer! The company is around in my hometown for over 40 years now.

They survived through adoption, innovation and finding their niche of uniqueness. And this with a product range where most people would predict that amazon, eBay and pure play merchant will take over. I guess that was predicted a couple of years ago…

So let me also make a prediction here: If a merchant of any kind and size is innovative, can adapt and finds his niche of uniqueness, he will survive. Those who just sell the same shit as thousands of others will die sooner or later, because they do not have a distinction. Basically the commerce scene is like it always was: changing.

(Picture from nggalai)

3 Responses to Brick and mortar is not dead yet

  1. Pingback: Brick and mortar is not dead yet | secrets of management

  2. Arne says:

    You spotted it. Ecom is very overrated. An 2011 study in germany (called one of the biggest growing ecom-markets worldwide) there is no such thing like “growing”. the top-buyers are just buying more. but there are no new online customers which are growing. therefore the “growing” is a fake of statistics and besides of that, only a few very famous (well branded) shops can show growing sales. the rest is just beeing able to stabilize with slowly increasing costs for the same revenue. This will lead to a clash offcourse. the next worrying fact is, that the onlineshops are even more distant to customer-needs. the managers have no clue about user-experience, user-feedback or bringing unique value to the customer. especially fashion is just focused on prices and sale. the learn, that only sale is just running realy good therefore more than 50% of revenue is made by sale and getting higher, because they all have no clue how to add another value to their customers. its a trap and dead circle. just look at how onlineshops present their wares. just lists with pictures and prices. there is no realy shopping experience, no shopping-emotion. its just “go here and buy our stuff! buy it now!” along with random simple inspireless marketing-communication. I realy think that smart offline-shopping with nice online-support is the key to the future. but the so called Ecom of today is just horrible and will find its crash soon.

  3. Christian says:

    I agree that brick and mortar is not dead but I believe it must learn from e-commerce and adapt. Technology (performance advertising and tracking) has helped e-commerce grow and this trend will carry on in offline stores as well. Modern POS systems do quite a bit but visitor flow systems like 42reports, crosscan or dilax will bring a new class of data to offline retail and allow b&m stores to compete on a level playing field. In the end, we are social animals and we want to go out to shop. This phenomenon will never go away.

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