Larger Brands Are Blending Retail & Online-Only - Should You?

By Kellie Auman Posted on 11/21/17 9:45 AM

If one word could characterize what’s happened to retail over the last couple decades, it's disruption. The age-old practice of selling goods out of physical retail stores has been challenged by the rise of “eTail”, online-only buying experiences.

Many talk about eTail “killing off” retail, but that’s not really the reality. eTail only makes up a small fraction of overall sales – around 10% – but what’s worrisome is its growth, and the effect it’s having on individual retailers. eTail is growing far more quickly than retail, and a large part of that growth is explicitly at the expense of retail.

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This has caused manufacturers and distributors to look for new approaches. The growing interest we’ve seen in indirect sales channel systems is an obvious example. This allows vendors to reduce some of their own vulnerability by selling to retailers, rather than to the public. Some brands have begun to increasingly look at ways to blend retail and eTail strategies to try to get the best of both worlds.

Blending Online and Offline Shopping – How Your Ecosystem Might Benefit

There are two basic paradigms to look at here. One would be a primarily offline business looking to move online, and the other would be an online business looking to go physical.

Chances are, most of our readers are going to be in the first category. You and your sales partners are primarily in the physical space, and you’re probably seeing at least some squeeze coming from online sales. Here are some ideas for what can you do about it - 

  • Increase your own digital presence. Invest significantly in website and web-purchase systems, and make sure that your partners all have equal access to it.
  • Look to streamline your sales processes via electronic methods. As we mentioned in a recent blog, time is money and reducing the amount of time a sale takes to happen can significantly reduce lost leads.
  • Spend more time and effort on SEO and inbound marketing techniques, combined with systems to smoothly redirect inquiring customers to the proper local sales outlet. This sends more clicks your way.
  • Deploy better data-sharing so that your partners can share lead information with each other or, if necessary, even collaborate on larger accounts which span multiple geographic regions.
  • Recruit online-focused partners to further diversify your ecosystem.

For those who are already online-focused and looking to embrace physical outlets, it gets more difficult or esoteric. We recently saw Amazon simply buy up Whole Foods to give themselves a grocery chain – but few are in a position to make such a grandiose purchase.

The more common method is to form store-within-a-store partnerships, by placing kiosks within participating retailers and other channel partners. If you do distribution to major outlets, this could potentially be a very workable strategy. You pay a relatively small amount of money for some physical space, while customers have direct access to in-person staff. In the meantime, the partner location hopefully gets a boost to foot traffic, which offsets some of their own losses to eTailers. Done properly, it’s a win-win-win.

Bring Your Ecosystem Together With Smarter Software

One thing is certain – embracing strategies like these requires a significantly better level of integration and oversight within a multi-channel sales system. You need software capable of centralizing your sales operations, supporting your partners, and combining data into one single analytical repository.

LogicBay can make that happen. Our groundbreaking Partner Relationship Management software can be your all-in-one channel management platform. Contact us directly to learn more!

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