Survey finds ecommerce is a complement to bricks and mortar, not a replacement

  • News
  • February 18, 2016
  • Erin McKenzie
Survey finds ecommerce is a complement to bricks and mortar, not a replacement

The first annual ‘Big Issues in Retail’ survey was conducted by Massey University’s Centre for Advanced Retail Studies (CARS) in collaboration with Monash University based in Melbourne and Retail NZ.

A total of 263 Kiwi retailers responded.

The survey found stores remain the most important revenue source, delivering 60 to 80 percent of revenue and outperforming websites, social media and mobile.

The results mean most emphasised the importance of having a significant physical presence, lead researcher associate Professor Jonathan Elms says.

“That’s because the store is the brand experience, it offers a level of personal customer service and provides a direct experience that can’t be emulated online. Even Amazon is opening stores now,” Elms said.

Elms says what bricks and mortar offers hasn’t been beaten by online services, as customers want to know they have somewhere to go if they have a problem or need to return a product.

Despite this win for stores, there is growing need to integrate the online and store trading environments.

Greg Harford, general manager public affairs at Retail NZ, said: “We have seen retailers striving over the last few years to create a whole in-store experience, moving away from a mainly transactional environment.”

An example of an omnichannel store used during Jonathan Elm's presentation

Last year World began using the cloud to deliver a personalised shopping experience by collecting customer data. Information relating to everything from age to previous purchases and music tastes could be collected from a customer connecting to the instore Wifi, allowing the store to adapt accordingly.

Stolen Girlfriends Club also incorporated cloud technology into their first retail store. Using Vend software, the fashion label has eliminated the need for a “cluttered” cash register by using iPads as the point of sale throughout the store.

Harford said the retail sector is entering autumn on the back of a strong sales period and most retailers are feeling positive about the coming year.

“Although some areas of heartland New Zealand are less confident, retailers in the main centres are generally expecting to meet or exceed their targets over the year.”

‘Big Issues in Retail’ key findings:

• Business activities have increased over the past three months and retailers appear optimistic about future market changes. However, large businesses are more positive about the future than small and medium-sized businesses.

• During 2015, consumers’ needs were found to be more varied. Consumers shopped through multiple channels and became more price-sensitive and demanding.

• Print media still ranks surprisingly high among retailers as a way of communicating with consumers coming third to social media and search engine optimization.

• Three-quarters of businesses collect and use data in decision-making. Consumer data are collected more often than market data.

• Improving the in-store experience is the most important customer loyalty strategy, followed by maintaining privacy of customer information and improving the online experience for users. Loyalty programmes, customer collaboration tools and online vouchers for redemption are of lower importance to retailers.

• Large businesses source 20 per cent or less of their products from within New Zealand, while small businesses source 80 per cent or more of their products locally.

View the full research report here.

​ ​

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