Daily Archives: June 6, 2017

Online Retail Thriving, But Doesn’t Signal End of Physical Stores

Online retail information on a computerTraditional physical stores, where items are neatly displayed and shoppers line up to the cashier, will still be relevant in the retail industry despite the growing popularity of the e-commerce sector.

That is, however, if owners of conventional retail stores learn how to adapt to changing consumer trends, as they have to deal with challenges beyond monitoring competitor prices from online retailers.

Here’s what pricemanager.com found out and wanted to share with you:

Triple Threats

Sharmila Chatterjee, a professor at the Massachusetts Institute of Technology Sloan School of Management, said that traditional retailers currently face three challenges that hurt their chances of keeping up with the rapidly emerging e-commerce business.

Lack of focus on customers’ experience, avoiding core competence, and failing to see online stores as complementary businesses comprise these challenges. Chatterjee based these concepts on her own experience in dealing with physical stores.

Her insights may or may not be applicable to the entire industry, but we can’t deny the fact that some of the biggest retailers in the US are feeling the pinch. Macy, Payless ShoeSource, RadioShack and Sears are just some companies that have closed or plan to shut down their stores nationwide.

Retail Closures

Brick-and-mortar retailers have closed more than 2,800 stores so far in 2017. However, Chatterjee believes that the sector may still survive if businesses aim to maximize their advantage over online retailers.

Walmart, one of the country’s biggest retailers, serve as a good example. The company’s digital strategy for sales allowed it to achieve a 1.4% growth in revenue during the first quarter, as online sales rose 63% year over year.

By treating e-commerce as an added edge instead of a threat, Walmart made sure its business will continue to be afloat.

The traditional retail sector still has certain advantages, provided they don’t lose business to online retailers due to their failure to recognize customer needs beyond price discounts. If you own a brick-and -mortar shop, then you must find a way to keep up.