Brian Walker, Inside Retail

Online retail is set to take over the world of retailing. Shops will be extinct, no one will ever visit a shop again. The retail world as we know it will cease to exist.

The shopping centres, department stores, retail speciality stores are all threatened. No one will ever leave the comfort of their PCs or smart phones again.

All great reading, the stuff of best selling novels! There’s a plot, subtext and more bias than a Shane Warne leg spinner.

Our Retail Doctor Group research study in conjunction with our global partners continues to tell a rather different story:

Online is an important part of any retailers multi channel presence (as is social media).

• Online is a critically important research tool and our customers are using it increasingly.
• Online currently accounts for less than 8% of our total retail spend.
• International evidence that organic growth in e commerce is actually slowing down (Source: Neuro marketing conference – Munich 2011).
• Research shows that a strongly branded physical store network is vital to growing a good online offer.
• Wait this can’t be true, surely not? What happened to online world domination?

The first and most key point regarding online is that it is an amazingly powerful tool to capture customer data, onsell, upsell, promote and essentially keep that customer for life. Its automated ability to capture real time customer data, to establish and embed buying practices and future predictions of target customer shopping behaviour is certainly something to make use of. However we still see the vast majority of retail sales in this country in the physical channels.

So our key fitness tip is to not just embrace online retailing but to embrace integrated multi channel retailing. And we actually have real facts and research to support this! Not just a good story and a few exaggerated claims!

Forrester research quotes multi-channel shoppers spend 1.8x more than a single channel shopper and we see similar figures from leading retailers. Urban Outfitters, for example, says shoppers that use 3 channels spend six times more than single channel shoppers.

Compare these figures and research with those physical retailers who do not have an active and mined customer database. Now we start to see the huge competitive advantage (and opportunity) that multi channel retailing has.

Happy Fit Retailing!

Brian Walker is MD of Australasia’s leading retail consultancy Retail Doctor Group (www.retaildoctor.com.au). Contact 02 9460 2882 or email brian@retaildoctor.com.au.