Trend: Online retailers discover value in having stores

By Joe Holley, Frank Mayer and Associates

I know most readers are concerned about what’s happening tomorrow and next month and before the end of this year, but there’s a hopeful trend in retail that will bear fruit in the years to come. Companies that began as pure-play online retailers are discovering the power of having physical stores to build their brand.

In some cases plans begin with flagship stores, but for others they signal a more deliberate move into bricks and mortar. Take Warby Parker, a trendy eyewear retailer, for example. They realized a physical presence would be integral to their growth. 

The business which began online four years ago now has eight locations either completed or in the works. Their website says, “Our retail spaces combine the snappy ease of online ordering with the fun and serendipity of real-life shopping (with a photo booth or two).”

Warby Parker’s statement is acknowledgement that businesses can develop a base with online shoppers, but growth in select categories requires the kind of awareness, product credibility and experience that a physical presence can achieve. The two channels work together in that customers who make their first purchase in the store may then be comfortable making future purchases online.

What can be achieved when you build a retail presence from the ground up? You can create imaginative spaces. You can have seamless experience between channels from the start. You can create an extraordinary brand experience. You can seize new opportunities.

Unique settings

In repurposing existing spaces, Warby Parker is creating unique store environments that blend the old with the new. In April 2013, Warby Parker opened its flagship store in NYC’s SOHO district. This maiden store features high display shelves, a rolling ladder, and old brass library lamps. The cool, old library vibe is juxtaposed with the most up-to-date technology.

Multi-channel without multiple barriers

Warby Parker intertwined vintage atmosphere and new technology without being bound to a multiplicity of existing systems. The installation of Wi-Fi sensors throughout the store tracks the flow of traffic, customer browsing trends, and product preferences. The customer data collected helps improve the shopping experience both in-store and online.  POS on tablets allows sales associates to move freely about to serve customers where they are.

Built-in experience

In its first foray into bricks and mortar, four-year old online cosmetics retailer Birchbox is devoting the second floor of a new Manhattan store to building community and offering things that can’t be obtained online. They will hold classes on makeup application and skin care and offer styling services. Technology will facilitate the in-store experience. Self-service touchscreens throughout the store will enable customers to input information and pull up relevant, personal product recommendations and reviews.

Space to collaborate

Long-time e-commerce stalwart 1-800 flowers, which realizes 73 percent of its business online and on the phone is adding franchise stores in more markets so it can pursue collaborative business that isn’t easy to achieve with just  an online presence. Among other things, they found they were missing out on business opportunities like weddings and events.

These kinds of retail developments make sense for young shoppers — the kind who would use Warby Parker’s photo booth. While Millennials are more likely than their parents or grandparents to shop online, 81 percent of their dollars are still spent in stores, according to NPD Group. They still value the experience of shopping and seek entertaining and fun venues. They will use all the channels and switch among them according to their needs and desires.

(Photo via Fast Company.)