Bricks and Clicks: Online retailers are opening physical stores
Oct 4, 2016, 6:26 PM | Updated: Oct 5, 2016, 8:20 am
A UPS survey shows that shoppers now make 51 percent of their purchases on the web. It’s old news that the surge of online shopping has caused some brick and mortar businesses to close. As book sales soared on Amazon, we watched mom and pop bookstores struggle. Borders went bankrupt and Barnes and Noble closed many stores. But that was before bricks and clicks.
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Strangely, Amazon opened it’s own brick and mortar bookstore in Seattle’s U-Village last year. And they plan to open three more in Portland, Chicago, and San Diego. Reports say Amazon plans to open up to 100 retail shops where they’ll sell devices like the Kindle. And it isn’t the only online retailer, or e-tailer, to open a physical store.
This movement is called Bricks and Clicks: online companies that accessorize with physical retail stores.
Bricks and clicks
In Seattle, we have Warby Parker and Bonobos stores, and soon you will be able to buy a diamond in person from local jewelry company Blue Nile.
“Bellevue will open by Thanksgiving, that’s the plan to date. It will be our fifth location,” Josh Holland, director of brand experience at Blue Nile, said.
“We do believe there is a certain segment of customers who want to see and touch and feel that ring before they make a purchase,” Holland said. “That’s okay too. It’s totally their call, it’s all about what’s right for them.”
They call their retail stores Webrooms, physical locations where you can go in and actually touch the engagement rings. Well, some of them. They only have 400 products in the Webroom, and 150,000 online.
“There’s this open table of rings,” Holland said. “Customers can go up to this table, try things on, see what style really works for them. If they want to they can take that style up to one of our non-commissioned diamond jewelry consultants, who can help them really customize that ring. At that point, if they choose to, they can order via one of out in-store tablets or at a later date on their own PC, tablet or mobile phone. All of the products are shipped free, via FedEx, and then fully insured to their door, in as little as 24 hours.”
There is no actual merchandise for sale in the store. Just like there are no glasses for sale at Fremont’s Warby Parker or at the men’s clothing store Bonobos, where a “guide” fits you for clothes, let’s you choose colors and patterns and then ships your purchases to you.
So why are online companies going the way of bricks and clicks?
“I think a lot of it has to do with trying to find ways to compete with Amazon,” said Alex Burg, director of strategy and analytics at Seattle’s Fell Swoop. “Amazon has grown so tremendously over the past few years and it’s really been eating a lot of retailers’ lunch. So these new Etailers are looking for ways to compete and a primary path in which to do that is on experience. It’s too tough to compete with Amazon on price and service, in some cases, particularly with Prime and how rapid their shipping is. The Etailers have been opening up retail shops to really try and deliver an end-to-end experience.”
Holland says the physical stores are great for bringing in new customers.
“I can’t discuss specific sales, but what I can tell you is the Webrooms have exceeded our expectations,” Holland said. “What is great is that a lot of the people coming to the Webrooms having never heard of Blue Nile before. So it’s doing double duty as a marketing tool.”
The simple fact is, there are still lots of people who want to try on clothes or an engagement ring before they buy.
“It’s still pretty hard to replace the human experience,” Burg notes. “Increasingly, studies are showing that people are giving gifts that are more experience driven now than material items. I think there’s a reason for that, we want to have a connection with our local community and with others. I think online has certainly replaced a lot of things and has certainly made some real great advances in terms of e-commerce and the ability to have access to hard to find inventory. But there’s a lot of things it hasn’t been able to replace, and a lot of that is a personal touch.”
