Nearly 20 years have passed since the demise of brick and mortar retail was forecast. Those in the know — and I was one of them — understood that the Internet was going to change everything. Moreover, while some businesses (like travel agents) have gone the way of the dodo bird, how the world wants to shop has actually changed very little. According to eMarketer, global retail sales for 2014 were $22.492 trillion. E-commerce accounted for a mere 5.9 percent of that total, and the four-year forecast estimates that share will grow to only 8.8 percent. So it appears that people still like to go out and touch stuff.
However, the way we shop has changed a lot, and the Internet is responsible for much of the change. Most product research is conducted using the Internet, and recommendations for products are collected and communicated there as well. Informational websites and social media are now a major part of the buying process. Few businesses can successfully exist without an online presence, as approximately 63 percent of the U.S. population made an online purchase in 2014, representing 6.5 percent of U.S. retail sales. Yet, the country with the largest amount of online sales is not the U.S., it’s China.
At $426 billion, online sales in China today total $120 billion more than those in the U.S. China is forecast to represent 40 percent of online sales in 2018, exceeding $1 trillion. The U.S. will fall to a distant second, with $493 billion in digital sales. owever
However, the percentage of buyers will be greatest in the U.K., with 73 percent making at least one online purchase, versus only 27 percent of Chinese buyers making such purchases. Clearly, digital buyers in China include more frequent users than any other nation.
The Internet as a source of commercial and social activity will continue to grow and flourish. Yet, it is quite apparent that brick and mortar stores will be around for a while. In fact, while this may be short-lived, Best Buy — once considered dying, if not close to dead — has actually seen an increase in sales. They appear to have successfully promoted price matching for in-store comparison shoppers and improved the online buying experience. They saw unexpected increases in both areas of the business; in-store and digital purchases have grown 2.2 percent and 22 percent respectively.
The global economy is complex and slowly recovering from the last recession. How a business attracts attention and acquires customers must leverage many touch points, digital and physical. The multi-channel strategy best achieves business objectives.
David Byrd is chief marketing officer at ANPI and leads marketing programs for SMBs, enterprises and carriers. Prior to joining the company, Byrd was chief marketing officer and executive vice president of sales at Broadvox where he built a nationally recognized channel partner program and award-winning SIP product offering.