By Tony DeMasi, editor
rick. Slick. Click. That’s the combination to success in retailing.
Brick is an actual store. Slick is advertising and direct mail. Click is
advertising and online store. Brick and click should especially work
well together. Shoppers should virtually buy whatever is in the store
through the Web site. Consider the Web site your 24/7 store!
If you aren’t up to this task yet, you’re not alone. Even some of the “big
guys” are still finding their way. Just recently Bath & Body Works, the 1,600-
store division of Limited Brands, figured it was time it had an online store…
15 years after the brand was established! Up until a few weeks ago the Bath
& Body Works site only offered information, not shopping services. The company
expects business to grow 14 percent thanks to this service.
The new site is fully functional, and a great role model for you to follow. It
includes many special features that will coax shoppers into spending more
than they might have originally intended:
Customer and Pre-packaged Gift Sets — customers can buy ready-made gift
sets or create custom gift sets by mixing and matching items.
Online Only Items — To encourage shoppers to repeatedly visit the site, the
company offers exclusive online items. These might be items either no longer
carried in the store (great way to get rid of closeouts at full price), or items the
store is considering carrying (great way of test marketing).
If the GSI arrangement means Bath & Body Works will make no capital
investment in fulfillment software, warehouse, etc. and GSI will staff all related
functions, then this will probably be a winner for both companies. As long
as Bath & Body Works keeps the cost of Internet customer acquisition under
control, this may be profitable almost immediately. Limited can generate customer
e-mail address lists at a very reasonable cost using all its divisions’ instore
traffic. It’s hard to sell private label personal care items via the Internet,
unless the customers have already sampled the items first, since color, texture,
and fragrance can’t easily be experienced online. For people who haven’t got
ready access to the stores, it may be worthwhile to start a low-cost sampling
program. The great thing for the company is that private label beauty aids have
excellent gross margins and, once a customer buys something she likes, she’s
likely to repeat the purchase.
Your Web site can also be used for customer feedback. In short, it’s a very
valuable tool. Much too good to pass up.
Browsing to shop online has increased almost a full hour in two years, and
it now crosses all age and income groups equally. Frequent purchasers on the
Internet have also increased significantly, but skew to upper income shoppers.
Bricks and mortar stores are not at risk of obsolescence this decade or next,
21 percent of shoppers now say online purchases are not in addition to their
in-store shopping. That’s a significant increase in two years.
The rank order of the pros and cons of online shopping have not changed
since 2003. However, the big selection and bargain hunting have lost their
allure for some. And yet, a solid 40 percent admit that they enjoy shopping
in stores.
It is taking a while, but more shoppers are becoming more comfortablebuying more categories online. Increases in office
supplies and electronics purchases online may not
be surprising, but more shoppers trusting their photos
and prescriptions to the Internet is evidence of a
new level of confidence. And that confidence is
spreading to home décor, jewelry and OTC medications.
Online shopping has not turned malls into ghost
towns, but it is on a constant creep into more categories.
Within 24 months, expect to see sizable
increases in groceries, as well as entertainment, health
and home online, plus a new definition of “social
expression” through online greetings.
Research reports show that 21 percent of shoppers
see the Internet replacing their trips to stores, a 6
point increase since 2003. There would be no need
to visit an office supply store when the web makes it
so easy. Will this soon be true for the souvenirs or gift
store?
The decline in the appeal of the Internet for big
selection and finding sales suggests that more of the
population is finding it too much work to browse all
there is to see online, and figure out the fine print on
the “sales.” The relative simplicity of choice at bricks
and mortar retail offers a different kind of value that
needs to be reinforced.
It’s Showtime
I’ve quite a few trade shows on my schedule this
spring. They include seminars at the Philadelphia
Gift Show, the Orlando Gift Show, and Chicago Gift
& Home Show. Here’s the schedule. Hopefully we’ll
see each other at one or another.
Jan. 8 - Philadelphia Gift Show (Ft. Washington
Expo Center.) Gone With the Window. Visual merchandising
ideas
Jan. 22: Chicago Home & Gift Show
(Merchandise Mart.) Hue’s On First? Color trends.
Feb. 5: Orlando Gift Show (Convention Center.)
Hot Trends.
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