The lines of distinction continue to blur between e-commerce and the physical world. Upscale department store chain Nordstrom (NYSE:JWN) and online diamond merchant Blue Nile (NASDAQ: NILE) recently announced a partnership that will allow prospective brides to try on select wedding jewelry in Nordstrom stores before buying online at BlueNile's site.
Perhaps it's the sluggish economy and retail fears over what is expected to amount to a disappointing Christmas shopping season, but companies that were previously Web-only are looking more frequently for physical locations to expand their reach. Whether it's partnering with an existing business, as Blue Nile and Nordstrom have done, or setting up shop on their own, as Gap subsidiary Piperlime did with its first bricks-and-mortar location in Soho, New York City, it's not easy to tell who's an e-tailer and who's a retailer.
It's an interesting phenomenon considering the explosive growth e-commerce is witnessing. While offline retailers felt the need to get the holiday shopping extravaganza started early this year to make up for a shortened shopping window -- yet still pull in anemic growth numbers -- Cyber Monday sales set a new record, surging to more than $2 billion this year. Despite the predictions we may be seeing dying days of physical retail, online shops are looking to it as a means of extending their own viability.
More likely it represents a growing consensus that omnichannel retail is becoming the rule. Like the automobile industry, where all cars seemingly look alike because designers seek to achieve the same aerodynamics, fuel economy, and so on, retailers, whether offline or online, are reaching for similar tools by allowing shoppers to make a purchase no matter where they are: in a store, on a mobile device, or flipping through a catalog.
That's why we're seeing retailers as diverse as Target and Staples adopt the online price-matching policies unveiled by Wal-Mart to meet head-on the challenge imposed by Amazon.com's (NASDAQ:AMZN) ubiquitous presence.
It's why Amazon installed delivery lockers in physical retail locations, and stores from Wal-Mart to Macy's launched ship-to-store policies while Google and eBay started up same-day delivery services.
The Internet has turned retailing upside down, and mobile communications are driving it to further extremes. So we'll continue to see the likes of eBay and Etsy testing out the physical model with pop-up stores -- just as Microsoft used to do, until it finally opened up its own chain of retail outlets.
Part of the change has to do with the safety consumers feel in being able to physically touch and test a product before purchasing it. The showrooming effect that nearly brought Best Buy to its knees was an outgrowth of that desire for a hands-on opportunity to kick the tires. So while Amazon and other Web-only retailers may enjoy a certain cost advantage to their streamlined operations, bricks-and-mortar retailers benefit from the comfort their customers feel by knowing there's a real store behind the name.
Making the sale has become of prime importance, and making the process as easy as possible -- no matter where, when, and how the customer is accessing a store -- will eventually erase the differences between online and offline completely.