Should your e-commerce store go brick and mortar?

Why are e-commerce brands opening physical locations?

There has been an interesting trend among e-commerce brands the last couple of years. Brands like ModCloth, Allbirds and, famously, Amazon have been opening brick-and-mortar locations. In Amazon’s case, their acquisition of Whole Foods means they now control 450 locations of the grocery retailer, as well as others like Amazon Books and Amazon Go, in addition to their 600-store portfolio of physical stores.

The reasons for Amazon opening up physical stores may seem completely disconnected from the average e-commerce retailer. Physical retail stores have been struggling. Toys“R”Us closed all of their stores following bankruptcy, but more retailers like Gap, Walmart, Gymboree and Walgreens have also planned hundreds of store closures.

So why would e-commerce brands enter a market that seems to be losing to online sales?

E-commerce brands opening up locations “IRL” (in real life) reflects a trend that no retailer can afford to ignore: customer experience.

For many e-commerce brands, a physical location gives customers a chance to experience their products before they buy. Whether stores sell clothing, home goods or food, the role of customer experience in the purchasing cycle is growing more important as convenience and price optimization reach critical mass.

Research into the importance of customer experience backs this up. According to a report by Oracle:

• 86% of customers will pay more for a better experience.
• 89% of customers began doing business with a competitor following a poor customer experience.

So, what does this mean for your e-commerce business? You can’t compete with Amazon on price and convenience, but you can beat them on experience.

But what does a superior customer experience actually look like? What do customers want? The Oracle report on customer experience lists the following as the most important aspects of experience, identified by consumers themselves:

• 73% identified friendly employees and customer service representatives.
• 55% said they wanted the ability to find the information and help they need.
• 36% favored personalized experiences.
• 33% want a brand that has a good reputation.

By far the most important aspect of customer experience is the staff you have to meet the needs of your customers. Being able to connect with a staff member at your business is an important predictor for future purchasing behavior.

The other factors listed above, however, can also be fulfilled in a physical location. Staff members can not only be friendly, but also work with customers to find the personalized solutions to their needs. A store that lets customers try before they buy can help them make sure they’re getting the product they need. And establishing your business as a part of the local community, with a physical location and membership with the local Chamber of Commerce, can boost your brand’s reputation.

Opening a brick-and-mortar outlet for your e-commerce store is a step that should not be taken lightly. It adds overhead costs, for sure, but it could also lead to a more fulfilling experience for your customers. A superior customer experience, particularly if your competitors are lacking in that area, can lead to big returns for your business.