As 2017 is advancing, e-commerce companies such as Amazon are started gathering their revenue-related data after the recent holiday craze. Customers who purchase online spent more than $5 billion by the end of Black Friday, according to Adobe Digital Insights.
On the other hand, brick and mortar retail giants like Walmart still lead in the revenue race. They continuously sell more than Amazon, Apple and Microsoft combined. Nevertheless, the situation might overturn soon.
The power of online shopping is growing stronger with each season and it may pose a real threat to physical stores. Despite the growing number of online shops, people still seem to be buying in traditional retail shops. But does 2017 mean the death of brick and mortar stores?
Efforts for a Better Bargain
The effect Black Friday has in terms of making money is overwhelming, to say the least. Many people would rather jump online than stand in long queues to purchase the product they desire. Companies that operate online are now making new efforts to beat physical stores. A better bargain means more customers.
One clever strategy that e-commerce businesses apply is to give the reduction in cost for particular items in between holidays. That means people have a longer period to decide whether they really want to buy the specific item. What’s more, the site then gathers more visitors.
For instance, Amazon has turned Black Friday into a “Black Month.” The company promised to offer great deals on electronics and toys until Dec. 22. The extended discount period is well-timed since Christmas shopping will soon take place.
Do Online Stores Always Have the Best Deals?
Prices in multiple online stores vary as same as in-stores. Amazon may be the biggest online retailer, but that doesn’t mean they are the cheapest one. According to 360pi, Google Shopping showed better deals on almost 60% of Amazon’s best selling products.
Furthermore, since e-commerce businesses have fewer expenses, they can offer more sales through the year. But physical stores have shown to have no better (or worse) deals than their online opponents. The prices fluctuate according to the demand, supply, and the competition.
Traditional Retail Goes Online or Closes
Online selling may grow as fast as 20% per year, but traditional retail strikes back with “omnichannel shopping”. Omnichannel shopping integrates both online and offline retail experience for the customer. Certain stores now offer up to 90% of their inventory online.
This made it easier for customers to see whether the items they search for are available in their preferred shopping locations. Since physical retail brands don’t have a tradition of selling on the web, many of them lack the option to finalize the purchase online. That’s the main reason behind closing down or filing for bankruptcy.
For those who decide to sell online, shifting to an e-commerce website doesn’t always mean bigger revenue. Smaller businesses which go online usually don’t have a good marketing strategy. Even though they enlist the inventory on the websites, the majority of their sales still comes from in-store buying, provided that they know their buyer persona and have a loyal customer base.
But the in-store buying faces a real crisis as 14 major retailers each closed 100 or more stores in 2016. Even Walmart closed more than 100 stores across the U.S. While popularity of online shopping cannot account for every closed store, it is certainly one of the causes for shutting them down.
Mobile as the Future of Shopping Experience
44% of Americans shopped more online versus in-store this Black Friday. This year, 56% of sales came from mobile shopping. Our portable devices could be the future of shopping simply because fewer people use desktop computers and more online retailers optimize their website to function well on mobile gadgets.
Traditional retail merchants could lose on mobile revolution if they don’t go online soon. E-commerce owners are a click away from making their website mobile-friendly. This is the biggest problem physical store owners face who don’t maintain an online presence; they cannot adapt to the mobile surge.
Are Brick and Mortar Stores Really Dying?
Given the fact that the discounts in-store and online are virtually the same, the only major factor which can help you decide whether to buy online is the comfort of your own home. It is significantly easier to order the things you need and having them shipped to your address. In spite of that, people prefer brick and mortar stores in certain situations.
Ultimately, using e-commerce is not suitable for last-minute shopping. You cannot have your item delivered in minutes. What’s more, when it comes to clothing, you cannot try on the item. If it doesn’t fit, it is just too much of a fuss to return it and wait for the new one to arrive in the mail. Online shopping undoubtedly has its benefits, but brick and mortar store won’t die anytime soon.