Clicks and mortar, or dot-cam retailers, will win out over pure e-tailers or dot-com retailers, according to Tony Standley, general manager of sanity.com.
Retailers need to leverage on the Internet as an additional channel, not only to achieve online sales, but to drive retail sales in their outlets, said Standley, who was speaking at the Retail Business Technology conference last week. "The Internet is a powerful fulfilment channel, which is the perfect addition for space-limited specialty retailers," said Standley.
Thirty per cent of Australians who have access to the Internet use it to research products but complete their purchase offline, according to John Rolland, director of Online Services at Telstra. Customers' reasons for purchasing offline varies. Sixty per cent said they are concerned about giving their credit card details over the Internet and 55 per cent still prefer to examine goods before buying them.
"An online-only retail plan is in the long term fundamentally flawed. In the short term, they probably will have some trouble with the development costs of building the business while waiting for revenue to come in," said Rolland.
Web shoppers spend 27 per cent more in stores, according to Julian Josem, managing director of Melhawk Computer Systems. "But this does not mean they spend it on the Web - they like to do business with their traditional retailers," said Josem. These consumers source information about goods from the Web before buying them in retail outlets, he said.
Other advantages which dot-cam retailers have over e-tailers are long-term access to store stock for fulfilment, existing marketing structures, recognised brands and in-store refund and exchange policies.
Standley also cautioned that retailers who do not have an online strategy will lose sales to those who have; lose credibility with connected customers and suppliers who are moving to dealing with retail partners via the business-to-business e-commerce model.