Looking back almost two decades makes you realize how technology has effectively shaped the landscape of most of the industries and markets. Technology has now become the centre of every industry, one of the consequences of which is the apocalypse it has caused in the retail markets. From the production side of things to the consumer end, technology has impacted the consumer experience as well as their expectations through various digital trends. The focus of the shoppers nowadays has shifted from merely product and price to the whole shopping experience, which is also a driving factor of brand loyalty. The crux: It is not only about the possession anymore, but the overall shopping experience and this article we will be shedding some light on the latest trend of Hybrid Retail focused on enhancing the consumer experience.
What is Hybrid Retail?
There was a time when in-store shoppers dominated retail markets. Brick and Mortar stores were quite a trend in the past, giving rise to stores like Wal-Mart, Target, Macy’s, etc. Then the age of E-commerce retail began with the rise of Amazon in the early 2000s, and this trend of online shopping took the world by storm. Following suit, other online marketplaces soon emerged, such as eBay, Alibaba, and many others. Since its evolution, the E-Commerce market has dynamically expanded. According to The U.S. Department of Commerce, there was an increment of 12% in the E-commerce sales from the fourth quarter 2017 to the fourth quarter of 2018, with the total online sales figure reaching $132.8 billion by the end of 2018. Although the percentage of online sales as a percentage of total retail sales has only increased (depicted in the chart below) yet, to say that the old brick and mortar trend has completely vanished would not be quite right!
Source: Digital Commerce 360
A good thing about technology is that it is continuously changing and evolving. Starting from physical stores to online markets, consumers have now reached the era of ‘Hybrid Retail’. A relatively new nonetheless a vital concept in this day and age, hybrid retail entails a mix of bricks and clicks! In simple terms, it is a mix of a variety of solutions to meet the shopper’s needs – online, click and pick up in-store, etc.
Benefits of Hybrid Retail
Studies have shown that having both a physical and online presence can lead to an increase in sales. Bridging the gap between physical and digital creates a seamless as well as personalized experience for shoppers, and that is notably what shopping is about these days. Many customers want the option of checking a particular brand’s inventory online before making a trip down to the shop in person. Thus, an online website allows them to explore their options conveniently. Customers can browse through the online catalog to find their desired items and see the locations in which it is available. Unlike online purchases, this hybrid model of retail also allows the customers to check and try the product out in real life physically. Furthermore, another benefit that shoppers get from this synergy between physical and online retail is that it saves the pain of waiting for the product to be delivered. I mean, who would even want to wait when they can go to the nearest shop and get the already selected product instantly?!
A Few Examples of this New Model of Retail
This relatively new model of Hybrid retail has been adopted by several retailers these days, be it the traditional Brick and Mortar brands or the E-Commerce giants of the era, everyone is now changing their initial business model according to the demands of the 21st century - tech enlightened shoppers. Almost every big brand like Wal-mart, Target, Macy’s, etc. has established an online presence for the convenience of the shoppers. Amazon and Bust Buy are two of the prime examples of this Hybrid Retail model that we are talking about! Amazon, despite being a successful E-commerce giant, is also establishing a physical presence through the acquisition of Whole Foods and Amazon Go. Best Buy, on the other hand, is tapping into the E-Commerce market through its ‘buy online, pick up in stores’ model.
The Bottom Line
The competition between physical and online retail has been going on for decades now. Contrary to popular opinion, the demise of physical retail is not merely due to the eruption of digital markets but due to the lack of innovation and modernization. In this day and age, where the shopping experience is the priority of the customers, the adoption of this Hybrid Model has become necessary for the retailers to grow and thrive.