And, if price was the only criteria, the majority of bricks and mortar stores (B&M) would well and truly be out of business by now.
Yes, as always, there are a number of consumers where price is the sole determinant in the decision to purchase. Traditionally, this has been around 10% to 15% of consumers.
However, what are the real facts?
A survey of 1,000 consumers undertaken in 2012 by global and innovation consultancy, Continuum, revealed the following principal reasons as to why consumers preferred to shop online:
The percentage who like better prices offered on line has increased to 25% from traditionally 10% to 15%. Now this would be considered a threat to many B&M businesses if this trend continued.
However, there is no doubt that the main attraction to online shopping is convenience – the ability to peruse and purchase 24/7. It would be virtually impossible for a traditional B&M business to compete with this without having an on line presence.
That aside, are we able to conclude that online customers find difficulty with traditional B&M? That is finding what they are looking for and interacting with employees? I don’t know but it makes you wonder what the shopping experience in general is like in these businesses. Are/is:
My experience over the last few years is that the majority B&M businesses provide an exceptionally poor customer experience – owners included. I have also found that many of the B&M businesses who have a website do not monitor online inquiries from their website. In fact, it really is a lottery as to whether your enquiry will receive any response at all. This is not good enough!
As a result, I believe it is the B&M businesses themselves that are pushing customers online simply through the provision of poor service. And once a customer gets the taste of online shopping and loses the fear of such, you may never get them back again (unless it is just to showroom i.e. physically check out a product in your store then go online to buy!)
Where to from here? Well, there is no doubt that the game has certainly changed forever and the many industries have suffered major interruptions such that the industry will never be the same. So hoping for a return of the good times experienced over recent decades running your business in exactly the same way will result in suboptimal performance.
I don’t have any magical answers for business owners swept up in this whirlwind of change.
However, some hints may be able to be drawn from the same survey where customers were asked why they shop in stores rather than online. The major reasons given were:
If you are solely selling low price, smaller, disposable type items, you may struggle to compete online.
However, if you sell bulkier, more expensive items then you will be in a much better position to compete with online for exactly the same reasons as noted above. However, to really excel, you will need to ensure you can:
And finally, it’s important to be a positive influence in your business. Yes, there are challenges out there – but if you are putting negative messages out there amongst your team and your customers, your business will definitely not reach its full potential!
