We are now 15 or so years into the Internet retail revolution, which is transforming itself into the mobile revolution, and it still amazes me how tone deaf some companies can be about their web and mobile presence.
My single largest pet peeve is this. In the year 2013, you have no excuse as a bricks and mortar retailer for not having your store level inventory online. Certainly people, whenever possible, will take the opportunity to order items for delivery, either from a bricks and mortar company's website, or from an online only enterprise. But a percentage of your "online" business can come from those customers who know you have bricks and mortar locations, know you offer a product, and would purchase the product if you would only let them know whether or not an area location has that product in stock.
This shouldn't be rocket science. However, you would be surprised how many retailers, including GNC, Vitamin Shoppe, and larger SKU chains like Meijer, Sears and Target, still don't understand this.
Web and mobile traffic should serve multiple masters. Yes, you want people to purchase products online. However there still exists the possibility that you can drive traffic to your bricks and mortar locations and capitalize on the see/want/buy/pickup market.
"But Dan, how large can that audience be?"
That's a fine question. So let me turn around and ask you a question. What products will you absolutely not purchase without trying them in a store environment first? Off the top of my head, my list is: shoes, glasses, a television, a car, a toupee, furniture and almost anything I would ingest for the first time.
But beyond this list, we all have things we impulse buy. And if the things we think we want impulsively are available to us, and this can be confirmed for us, our odds of actually buying it improve considerably. Which means we can then walk into your bricks and mortar location where your customer service people can, hypothetically, sell us more stuff.
And even when stores actually do have their inventory online, it doesn't guarantee a logical purchasing process, as the following two examples will illustrate.
I once wanted to purchase a printer at Circuit City. This printer, online, was advertised for $68. I could purchase it online and pick it up at the store. For various reasons most likely associated with naivete, I assumed this was also the in store price, or that Circuit City would price match their own online price. I arrived at Circuit City, where I had confirmed the printer was in stock, to find that I was incorrect on this. If I wanted it in the store, I had to pay $79.
Not wanting to pay the extra $11, I instead walked over to the computer section, ordered and purchased the printer online from the store, then walked over to the service counter with my confirmation number and picked up the item.
Along the same lines, I went in search of a book, specifically the Forks Over Knives cookbook. While I can purchase this item from Amazon, or pick it up on eBay, I have a list of things to do today, and figured I would see how much the book costs at Barnes and Noble. If I want to order it online and have it delivered, it's $11.86. If I want to purchase it and pick it up in the store, it's $19.95. This pricing structure is asinine. Let's assume that there are three types of product purchasing experiences:
1) I can buy something from Barnes and Noble online.
2) I can decide to buy something from Barnes and Noble online, but want to pick it up at a Bricks and Mortar location.
3) I can wander in to a Barnes and Noble location, find an item on the shelf and purchase that item.
Scenario #3 is the most expensive for the retailer. It requires them to have a physical location and a staff, along with all of the expenses contained therein. In theory, I as a customer am also paying for the experience of shopping at this retailer; the bookstore experience.
Scenario #1 is the least expensive for the retailer for reasons that should be obvious to you.
But Scenario #2 is not as expensive as Scenario #3, and should not be priced the same. I have done the legwork as the consumer. You as the retailer don't have to have a customer service representative sell me anything. That person has to spend the equivalent of one FTE/however many in store book pickup orders, pulling that piece of inventory off of the shelf and placing it on hold. And even if that is the only one of that item in the store, and even if there is an opportunity cost incurred by taking that item off the shelf, the aggregate amount of that expense still isn't enough to justify charging the same price for the item as in Scenario #3.
So Barnes and Noble will lose a sale to Amazon, which offers it cheaper, and their bricks and mortar location will lose foot traffic, and a chance to sell additional items, impulse or otherwise, to a customer that won't walk in the door.
Along the same lines, at this point it is unacceptable for any fast of fresh fast food chain to not have a mobile app that allows customers to order food directly from a smartphone. Chipotle does a wonderful job with this (heck, the ability to order Chipotle from my phone was one of the reasons I purchased an iPhone originally), Qdoba...I'm still waiting. The same goes for pizza. No one wants to be the person who actually calls and orders the pizza (one of the great social mysteries of contemporary American society), so Papa Johns got around this by being the most aggressive in getting web and mobile ordering launched. Donatos? Still waiting. (Actually, I'm not waiting. I no longer eat pizza. Or Chipotle. Or Qdoba. But those are other stories entirely.)
But honestly. We are 15 years into the Internet/Mobile revolution, and you'll read stories about the hand wringing that goes with the rapid decline of bricks and mortar retailers. And while there are reasons for this, price and the absence of sales tax in most states not the least among them, perhaps the most essential component is that bricks and mortar retailers still don't understand how to adequately address the buying habits of their customers, and don't understand the importance of inventory visibility. They have yet to master the art of using web and mobile applications to drive foot traffic to their locations; foot traffic that is instead driven to online retailers as a result.
