When it comes to the retail sector, we can separate it into two dimensions - with brick-and-mortar stores taking the traditional route and e-commerce bringing a modern twist. The online stores offer ease and convenience to consumers, while the physical outlets make sure that shops remain relevant.
Both kinds of stores have their roles to play in the modern retail sector.
If you are looking to start your business and trying to figure out whether to go the online route or to have a physical presence in the streets, don’t worry. We have got you covered.
Both stores, whether it’s a brick-and-mortar store or an e-commerce store, have pros and cons attached to them. Nowadays, you will hear much about how e-commerce stores are phasing out brick-and-mortar stores, and while there is something to be said about having an online presence, you cannot just take brick-and-mortar stores out of the race yet.
Our infographic “E-commerce Vs Brick and Mortar Store” contains 14 of the main reasons why you should set up a website for your business online.
Infographic by GO-Globe Web Design Bahrain
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Ecommerce vs brick and mortar |
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| E-commerce Store | Brick and Mortar Store |
| Lower Set-Up Costs (Rent, utility bills, and staff are not required) | Higher Set-Up Costs (Rent, utility bills, and staff are required) |
| Targets global customer base | Targets customers from surrounding areas only |
| Low Operational Costs (Completely automated process from product selection, invoice generation to payment) | High Operational Costs (Requires dedicated staff for each process) |
| Easy scalability without any additional costs (Can add unlimited number of products through CMS) | Limited scalability due to space and infrastructure constraints |
| Easy to Manage - Live/Work from anywhere around the world | Remote management is not possible - Requires physical presence at the store |
| Operational 24/7/365 for customers | Operational daily for 12 hours max, excluding holidays |
| Complete product details available to ALL customers through product description, images, and videos to guide buyers to make a right decisions | Impractical to explain full product details to each customer, especially during rush hours and peak season |
| Online customer reviews build brand advocates, which can help to promote the products through email and social media | Relatively harder for customers to leave and share reviews, missing on potential promotional opportunities |
| Offers personalized shopping experience based on the previous buying habits and history | Not possible to offer personalized shopping experience as it is impractical to remember the buying habits and previous buying history of customers |
| Easy to change the pricing and product offers with no additional resources | Whenever a product price is changed, each price tags have to be changed manually |
| Easy to contact customers via email alerts and other notifications | Lacks instant medium of communication to connect with customers |
| Real-time tracking of product inventory and efficient inventory management | Real-time accurate tracking of product inventory is nearly impossible |
| Easy to run advanced promotional campaigns and exclusive offers to a segmented customers based on their buying history | Not possible to run such an advanced promotional campaigns and offers |
| Allows targeting customers who left without completing purchase using Ad re-targeting or email notifications | Impossible to follow-up with customers once they leave the shop without completing purchase |
E-commerce Store Vs Brick and Mortar Store: Challenges and Opportunities
Lower Set-up Cost:
The main benefit of why e-commerce stores are a must is their flexibility and their ability to reach a global customer base as well as a considerably lower set-up cost. Lower set-up costs for an online store means as a business owner you’ll bypass the expenses for rent, utility bills, and many other staff requirements that you would otherwise have to allocate for traditional brick-and-mortar stores.
As you would naturally save a large capital on rent, bills, and staff, with e-commerce you can also minimize operational costs. Product selection, invoice generation, and payment up until delivery are all automated through an online system, providing a business solution through website development.
Flexible Room for Scalability:
E-commerce stores allow retailers a flexible room for scalability without extra costs and support to add an unlimited number of products through back-end CMS, while brick-and-mortar stores are extremely limited due to space and infrastructure constraints.
Open 24/7 and Easy to Manage:
E-commerce businesses are easily manageable from anywhere around the world and are operational to the world 24/7/365 at large, while brick-and-mortar stores require physical presence for smooth operation and they can be operational for 12 hours max daily, excluding holidays.
Complete Product Details:
Through e-commerce stores, the retailer can offer complete product details to customers through product descriptions, images, and videos guiding them and providing them with complete information so they can make the right decisions. For brick-and-mortar stores, it is relatively unattainable and impractical to explain full details to each customer and it becomes a bigger obstacle during rush hours and peak season.
Personalized Shopping Experience:
With online stores, retailers can offer personalized shopping experiences based on previous buying habits and history, and it is extremely easy to change the pricing and product offers without additional resources. For brick-and-mortar stores, each price has to be re-printed and replaced manually, creating unnecessary resource drainage.
Brand Advocates:
Online customer reviews are excellent brand advocates that can help to promote products through email and social media, which is a definite benefit for e-commerce stores, whilst not being possible for brick-and-mortar stores unless they set up website development.
Customer Follow-up:
With e-stores, retailers can contact customers via email alerts and other notifications, and is possible for real-time tracking of product inventory as well as running advanced campaigns, which aren’t possible for traditional stores.
Lastly, through e-commerce retailers can use ad re-targeting and email notifications to prompt customers who have left without completing a purchase. With traditional brick-and-mortar stores, it is impossible to follow up once a customer has left the store without completing their purchase.
Conclusion:
E-commerce stores provide business owners with a wide array of opportunities to help widen their customer base, promote their products, and boost their sales that are not available to brick-and-mortar store owners.
But brick-and-mortar stores have their charms, therefore you should make the best out of both of them. Start an online store and then when you have enough funds for business development, you can start up a brick-and-mortar store.
If you have the funds, then open up your store and then launch its website development, making use of the opportunities presented by both.
Frequently Asked Questions (FAQs)
E-commerce store vs brick-and-mortar store; which is the better choice?
Both e-commerce and brick-and-mortar have their business models and their opportunities and challenges. What might be a better choice for someone else, might not be the choice for you. The final decisions depend upon your own needs, choices, and preferences.
It is recommended to conduct a market analysis and research your target audience before concluding on the final business platform for you.
What is the key difference between online stores and brick-and-mortar stores?
There are quite a few differences between e-commerce stores and brick-and-mortar stores, but the most defining difference is the lack of a geographical location for online stores.
How have e-commerce stores affected the retail industry?
E-commerce stores have provided people in rural or non-metro areas with access to things that they previously did not have before. They can order anything, from anywhere in the world as long as they have a stable wifi connection.
For retailers, it provides them with a business solution to expand their customer base, and in turn, generate more profit.
What is the advantage of having a brick-and-mortar store?
The biggest advantage of having a brick-and-mortar store is providing an in-person shopping experience to customers and giving them instant gratification. There are no shipping delays or taking 5 to 6 working days before delivery.
There is also the fact that there are some products that customers prefer to look over themselves before they consider purchasing such as electronic items, glassware, etc.
What are the limitations of an e-commerce store?
Whilst online stores have a lot of advantages, they also come with many limitations such as huge technological costs, lack of personal touch, technical issues (the website crashing), logistics limitations, marketing and advertising costs, etc.
