EBUS Blog learning 12FN-154 Vinita sec B

Dear Sir,

Below is my second entry for the second week. Apologies for the delay.

Rising might of e-Tailers : Is Omnichanelling the answer?

Technopak predicts that the ecosystem creation for e-tailing will outpace the same for corporatised brick-and-mortar retail.  Earlier Technopak reports have also mooted that brick-and-mortar will continue to face structural issues like real estate, labour, sourcing and supply chain that will dampen the growth of the corporatised segment - it will, at best grow from 7 per cent currently to 17 per cent by 2023. However the growth of e-Tailing is predicted to be about 60% annually. Citing directly from The Economist makes it clearer  "…it is tempting to conclude that shops are to shopping what typewriters are to writing: an old technology doomed by a better successor."

What gives e-Tailers the Edge? | The Indian scenario

·     Most e-commerce companies offer better price and a larger selection, something that offline retail stores are unable to match. Online stores make changes every day in their offerings compared to offline counterparts that change only 4 to 5 times a year..

·     Brick-and-mortar's limited penetration in the smaller cities and towns where the aspirations of consumers are growing has created a sweet spot for this alternate retail channel to grow and thrive. Nearly half of the sales for e-tailers in India currently come from towns and cities beyond the eight metros.

·     Even in the urban areas, where consumers are becoming increasingly "time poor", the quality of urbanisation (transport, accessibility, work-life balance etc) limits the consumers' ability to shop at will and so non-store retail formats are increasingly becoming a preferred choice to shop. According to the Technopak report, nearly 40 per cent of the orders placed on home shopping networks are placed between 11:00 pm and 6:00 am.

One solution adopted by Lifestyle major Titan of Tata group is Omnichanneling.

Titan's online strategy is backed by omni-channeling, the system of marketing and selling products to shoppers through a seamless integration of platforms, including websites, mobile devices, television and radio, direct mail and even social media, in addition to physical storefronts. This helps in keeping a larger inventory and ensures faster delivery in certain cases.

Experts say that omni-channeling is one of the best ways that traditional retailers can compete with successful e-tailers. For both physical and online stores to co-exist, omni-channeling becomes critical.
However, omni-channeling is expensive given that the transition requires a new software architecture that can combine online and in-store inventory.

Companies like Nordstrom, Macy's and Wal-Mart Stores are using their stores as the points from which to ship products, to speed up delivery process. Others like Kohl's, Macy's and Target, besides some specialty stores and teen chains, are also opting for the 'buy online, pickup in store' route for the seamless integration of the online and offline businesses. Then, in some markets, brands like GAP and Banana Republic are letting consumers reserve items online, even holding them for a set number of hours/days so that consumers can collect them from the stores at a pre-determined time. Tesco allows consumers visiting the stores to scan QR codes of products and get them delivered at home.

Regards,

Vinita 12FN-154