The best of both worlds: how online and offline retail can work together
As traditional stores and malls battle to stay relevant in the age of internet shopping, there is no reason offline and online retail models can’t complement one another, according to some industry insiders.
“Today, consumers want a shopping experience that allies a complete integration of brick-and-mortar with online platforms: an omnichannel integration,” said Zino Helmlinger, head of advisory and transaction，services, retail, Northern China, CBRE.
In fact, a form of retail that combines the best of the physical and online worlds is gaining traction. Jack Ma, founder of Alibaba Group, has even given it a name: “new retail”.
E-commerce juggernaut Alibaba, which owns the Post, demonstrated its confidence in this trend by buying a 74 per cent stake in Intime Retail Group, a department store chain, in January, and an 18 per cent stake in supermarket chain operator Lianhua at the end of May. It also launched its first offline store in Hangzhou, named House Selection.
Amazon’s planned purchase of upscale grocery chain Whole Foods last month echoes the trend.
“The only difference is that payment is now seamless, customers enjoy technology in-store, and retailers enhance their big data to sharpen the shopping experience. The result is that today, online represents barely 13 per cent of total retail sales of consumer goods,” Helmlinger said.
Today’s retailers are increasingly relying on “experiential” stores, which include facilities such as restaurants and parent-child play centres to attract traffic flow – things that can’t be done online.
According to property services firm Cushman and Wakefield, food and beverage often accounts for more than 20 per cent of units in new and redeveloped shopping centres in more mature markets .
A new concept in non-mainstream, experiential food halls has gained momentum too. As well as restaurants, food and beverage counters and bakeries, these tend to offer additional attractions such as cooking products for sale or even cookery classes to add an element of ‘edutainment’.
“The link between shopping and eating is stronger than ever and is evident in the significant growth in F&B outlets in recent years, particularly in shopping centres. We see this trend continuing for the foreseeable future,” said Darren Yates, an analyst with Cushman and Wakefield’s retail research team.