Search

How ‘click and mortar’ can save the high street

It has been well documented in the UK that the ‘high street is dying’, with much of the blame apportioned to the clear competitive advantage that retailers that only sell online (“pure players”) have. However, to compete with their pure player counterparts, physical store owners have changed their business strategy and adopted a "multi-channel" approach by creating an online offering that complements their physical store. This online retail strategy is called "click and mortar" and it increases sales channels and helps to lay the foundation for a cross-channel product distribution strategy.

Consumers have become increasingly demanding and want to be able to buy products via a number of channels at any given time or place. With a click and mortar strategy, high street retailers that were hit by the growth of online retail, can get the edge over pure players by becoming multi-channel retailers. A physical store allows retailers to offer options such as "click and collect”, where customers order online and collect from a nearby store, "web to store" or “ROPO”, where they search online then buy offline, and "store to web" where they look in-store then buy online. These concepts are on the rise and are increasingly valued as key growth drivers for major brands and retailers. They have contributed to the UK e-commerce growth which rose by +17% YoY and represents now more than 30% of the European e-commerce market.

The success of a multi-channel strategy relies on the ability of a company to measure and meet the expectations of each target on each channel. Smooth and transparent internal organisation is essential, as failure to meet the expectations of consumers on one channel can quickly damage an entire brand. Therefore, up-to-date information systems, logistics and internal resources are key to a successful click and mortar strategy.

 

The challenges of technology

Trying to organise data across multiple channels can be a challenge for retailers. The Hybris group has tried to tackle this problem and since its acquisition by SAP, has come up with a cross-channel solution called the PCM (Product Content Manager), which allows the import, export and centralised management of inventory and the integration of all necessary product information across all distribution channels.  

 

What about logistics? 

The same problems that retailers encounter with coordinating data can also arise with logistics. Order management and inventory management are often classed as separate elements within companies. Despite an increase in the number of sites offering collection in store, logistics still have to pool information and increasingly widening their activities fields. Ultimately, the goal is to allow customers to buy on the internet and collect in store or buy in store and get delivery at home, and be able to access either channel when returning a purchase.

 

Why the human aspect must not be overlooked

 Resources pose another challenge to the organisation of a multi-channel strategy. Currently, many e-commerce sites feel that they are in competition with their own physical stores; this should not be the case. A combination of technical expertise, logistics and internal trade is vital for a successful cross-channel strategy. Synergy between online and offline services, and the right technology, should allow businesses to structure their product offer, to optimise order management and to better meet the needs of all customers.  Teams within stores lack sufficient training in how to process orders placed on the web, while customer service teams on ecommerce sites are not sufficiently informed in how to manage orders placed on third party sites such as marketplaces. Training must be undertaken to ensure that all staff understand how each channel works. 

 

Looking ahead 

All studies and trends from the US show that multi-channel retailing is the future. Brands must be present both offline and online to succeed. The nature of online sales has changed with the added dimension of multi-channel marketplaces, and buyers everywhere are in search of the right product and the best service. For brands seeking to leverage multi-channel retailing, they need to focus on the most successful sales channels for their target market in both their physical stores, and on the sites of distributors and the many marketplaces present in Europe. The challenge is to unify the distribution and marketing strategies to make them consistent on every channel.