Key Takeaways The online sales phenomenon is growing but bricks and mortar stores will continue to play an important role. As the Amazon Effect takes over, the online survivors will be the ones who offer customers the whole experience through a clicks and bricks omni-channel experience. Omni-channel retailing is the way of the future. The most important thing in retail is data. Over the last decade, online shopping took the world by storm driven by the e-commerce revolution. With the introduction of same day delivery services and smartphones, consumers moved away from physical stores in preference of buying goods online. Not only was it easier but it became more convenient to shop online, rather than spending hours at a shopping centre. But something else is happening in the land of retail, a transformation is underway changing the playing field once again. Online retailers are starting to move back into physical stores. What we’re witnessing is the pendulum swinging back. Online retailers are opening physical stores to bolster their online operations and enhance the customer experience, increase brand awareness and strengthen sales. What we’re seeing now is an evolution where online retailers are building a new kind of customer experience through physical stores. Its true terminology is ‘Omni-channel retailing’. Physical stores provide customers with a hands-on experience that cannot be replicated online. As a result, having realised the value in giving customers this hand-on experience, e-commerce retailers are actively opening up physical stores. But with a difference. The physical store is more of a customer experience centre built not to sell but to leave an impression on the customer so that they buy once they get home. The reason for this is because of a phenomenon called “showrooming.” Shoppers will visit traditional bricks and mortar stores to touch and feel merchandise but will then use their smartphones to compare prices, resulting in the item being purchased through another retailer, or even being purchased online. It’s as much about the experience and brand as it is the transaction. Regardless of how cheap a product is online, nothing beats being able to touch, try and feel that item before buying it. The main reason a customer abstains from purchasing a product, especially clothing, is because they cannot try it, before they buy it. The answer now lies within these showrooms. Leading the omni-channel retailing charge is Amazon. Last year Amazon shocked the retail and grocery world by purchasing Whole Foods for a whopping $13.7bn. You may be thinking, why would the online e-commerce giant want to buy a bricks and mortar franchise? At first it didn’t make sense. What was Amazon really up to? The acquisition of the Whole Foods stores is about three things; Clicks to Bricks, Big Data and product retailing. With a network of 481 Whole Foods stores, it gives Amazon to ability and extend its offering from clicks to bricks. The company’s E-commerce offering is called Amazon Fresh. Amazon Prime members shop online and have their grocery items delivered to the door. Delivery of the groceries is free if the order is more than $50 and is a same day delivery service. You can buy any item you would find at your local grocery store on Amazon Fresh. But the major barrier that stands in the way of an online grocery offering is the inability to inspect perishable goods. The desire to inspect goods is tied to uncertainty about product quality and freshness. Being able to see, feel and touch food can be the deciding factor in a customer’s decision to buy certain vegetables. How do you instil confidence and trust in a virtual world when the customer cannot inspect perishables? This is where Whole Foods comes into the picture. Amazon purchased Whole Foods to give customers that ‘in store’ experience. The missing piece of the puzzle. By having a network of stores, it also allows Amazon to let is…

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