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Discount danger: 10-tips and tricks to sustain both an online and bricks and mortar business

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As a customer, I have the preconceived expectation that if I purchase online, it will be cheaper than going in-store.  I suspect websites such as eBay and Deals Direct has contributed to building this perception by aggressively advertising discounted products.  In today’s blog, I challenge the theory that online should be cheaper than in-store and give 10 easy to follow tips on how to balance a traditional outlet shop vs. an online store.

Let’s face it - it’s no secret that running an online shop is far more cost effective than the traditional bricks and mortar outlet store.  Rates, rent, staff and electricity (the list could go on) are all considerably less.

Personally I choose to shop online out of convenience.  If I’m busy working on a project or travelling, I don’t have the time to visit a department store to buy gifts for my never ending list of relatives; I’d much prefer to purchase online and have it sent directly.

For this convenience, I’m prepared to pay the same cost as in-store, possibly even a little more for services such as shipping.

Retailers are constantly told that to sustain their business, they must have an online presence.  In Australia alone, PricewaterhouseCoopers reported $13.6 billion dollars was spent online in 2011, with this expected to rise to $21.7 billion by 2015.

If you’re a retailer considering opening an online shop, here are some tips on how to avoid damaging your product margins and brand, and to avoid the trap of building a rivalry between your department store and online shop.

  1. Offer the same promotions both online and in-store.  Make sure they are both running at the same time and have matching artwork.

  2. All product prices should be the same, especially sale or end of line items.  Also offer refunds and returns in-store for online sales.

  3. Be prepared to offer discounted delivery for online orders (or free delivery).

  4. Offer both home delivery and in-store pick up.

  5. Create a space in-store for easy online order pick up.  Do not make your customers line up in the normal point of sale queue.  Consider adding special short term parking spots (see Best Buy below).

  6. For new online orders, send the customer a coupon that can be used for future sales both in-store and online.  For retail outlet orders, print this coupon on the receipt.

  7. Display the in-store stock levels of products on your website.  Customers will use your online store to pre-shop.

  8. Encourage online customer reviews for products purchased in-store on checkout and the receipt.

  9. All products you stock in-store must be for sale online, vice versa.

  10. Add an easy to use postcode store locator to your website.

I’d be interested to read feedback on other tips for retailers in finding the balance between online shops and the traditional bricks and mortar stores.  Feel free to leave your comments below:

Best Buy - Online Shopping Advantage
Clever convenience

I took this photograph at Best Buy in the US.  This counter is at the very front of the store.  Notice the upselling of products in the background?

Australia and New Zealand online shopping market insights

Steven Pullen

Steven Pullen

Steven Pullen is the Operations Manager for digital marketing company Strategic Partners Connected.

1 Comment

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    31 July 2012

    This is mostly a great blog and i wish to visit this every
    day of the week “

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