While online retail enjoyed a bumper few years during the Covid-19 pandemic, the spotlight is back on bricks-and-mortar as the channel to watch for the foreseeable future. Customers are increasingly interested in getting back out into the world and enjoying the physical act of shopping, resorting to e-commerce more for convenience. This week, at the annual eTail conference in Sydney, Zane Matthews, head of retail operations at Blooms the Chemist, Marta Skrabacz, head of e-commerce at
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rce at Godiva ANZ, and Christian McKelvie, former head of marketplace at Catch spoke at length about each business’ wider bricks-and-mortar and online strategy, and how they’re changing into 2023.
The Third Space
Skrabacz explained that Belgian chocolatier Godiva’s is focusing on making its bricks-and-mortar stores a place for shoppers to meet up – either while socialising, or as a pit stop between other stores on a wider shopping journey.
“For periods of the pandemic you weren’t allowed to leave your home, other than perhaps a short walk around the block,” Skrabacz explained.
“I think retail, and especially for us as a cafe, is a third space. It’s not your home, and it’s not your office. It’s a place you can explore, it’s a place for community, and it’s a place for people to get together.
“E-commerce will continue to be important, but [physical] retail is going to be quite a [focus] for us, at least for the next decade.”
The business plans to launch a loyalty program later this year to personalise the in-store experience for individual customers, reward them for shopping with Godiva, no matter which channel they use, and incentivise them to shop both online and offline.
Meeting raised expectations
For Blooms the Chemist, the pandemic actually had a positive impact in terms of revenue. Pharmacies were one of the only places customers could reliably visit during lockdowns, as they were classified as an essential service, and this enabled store staff to strengthen their connections with customers. This endured even after restrictions were lifted.
Matthews said that expanding on Blooms’ in-store customer experience is one of its top priorities.
“The credibility we have with our customers has increased, and they’ve gotten to know their pharmacists a lot better. However, the expectations of what they need and want from our stores now is higher than ever before,” Matthews said. “Focusing our energy on that, I feel, is the best way to set us up for success.”
Meanwhile, Blooms sees e-commerce as an opportunity to expand its in-store offering, ranging items that are too big to be stocked in store, for example. Almost a third of its e-commerce sales are click-and-collect orders, bridging the two channels.
Crossing the streams
With so much focus on bricks-and-mortar retail, where does that leave online? According to McKelvie, the two channels are complementary, rather than competitive.
“I think the biggest takeaway from Covid-19 is bridging the gap between [physical and digital retail],” McKelvie said.
He noted that retailers are borrowing from e-commerce to improve the in-store experience and using advancements in chat functionality and AI to replicate a more conversational in-store experience online.
For instance, customers can now chat with JB Hi-Fi staff online and negotiate a better price. Previously, this was only possible in-store, and was one of the key reasons customers would travel to a physical store.
In saying that, McKelvie still expects customers to favour in-store experiences where possible.
“[Customers] are excited to get out there, and I think [retail] will fall back into some normalcy around the store and e-commerce split… but I think the real players that will emerge in the next few years will be the ones that really lean heavily into the strengths of each channel, and bridge that gap,” McKensie said.
