The emergence of electronic commerce (e-commerce) in the retail industry has considerably shaken up and changed the retail landscape. This short article will briefly summarize the changes of the last few years.
Both retailers and consumers have increasingly become accustomed to using the online channel. As a result, e-commerce has become an important part of the retail market. Today’s consumers are more demanding and use different channels while shopping (Piotrowicz & Cuthbertson, 2014). The enormous growth of e-commerce along with the rapid development of information technology has caused a fundamental change in the retail industry. E-tailing offers greater flexibility, convenience and customization. Furthermore, it enables retailers to reach more customers. In general, the new developments have had an adverse impact on the market’s attractiveness (Lu & Liu, 2015). Although the competition has increased, e-commerce also provides many new opportunities. Several studies have proven that online shopping can enhance the shopping experience (Piotrowicz & Cuthbertson, 2014; Blazquez, 2014). The number of multichannel retailing is growing and new technologies enabled the integration of channels. Also, brick-and-mortar stores are changing their layout and make use of technology in order to improve the in-store experience. The changes in the retail have substantially changed users’ shopping behavior as well as their social interaction (Blazquez, 2014). With new technologies, such as social commerce and the omnichannel, and an increasing popularity e-commerce will continue to affect the retail industry.
Some people wonder if the physical retail stores will ultimately disappear totally; I disagree. For some product categories, this could be the case, but for many other product categories people might still want to see, test and/or feel the product before they purchase it. Moreover, a new business model is emerging: Online to Offline (O2O). Alibaba, one of the largest e-commerce companies in the world, recently announced that it will open physical stores (Ong, 2017). In the Netherlands, the e-commerce company Cool Blue, already has opened up some physical stores (Ecommerce News, 2017). O2O embraces “Online discovery, offline showroom”, meaning that brands use their psychical stores as showrooms, where customers can feel, try and see the products. Thus, I do not think that brick-and-mortar stores will disappear in the retail industry.
Please leave your thoughts about this in the comments!
Bibliography:
Blazquez M. (2014). Fashion shopping in multichannel retail: The role of technology in enhancing the customer experience. International Journal Of Electronic Commerce, 18(4), 97-116. doi:10.2753/JEC1086-4415180404
Ecommerce News. (2017). Coolblue: “We are 90% ready for expansion in Europe”. Ecommerce News. Retrieved 21 October 2017, from https://ecommercenews.eu/coolblue-90-ready-expansion-europe/
Piotrowicz W., & Cuthbertson R. (2014). Introduction to the special issue information technology in retail: Toward omnichannel retailing. International Journal Of Electronic Commerce, 18(4), 5-16. doi:10.2753/JEC1086-4415180400
Lu Q., & Liu N. (2015). Effects of e-commerce channel entry in a two-echelon supply chain: A comparative analysis of single- and dual-channel distribution systems. International Journal Of Production Economics, 165, 100-111. doi:10.1016/j.ijpe.2015.03.001
Ong, K. (2017). Alibaba’s first mall shows that O2O is a real business model. Techinasia.com. Retrieved 21 October 2017, from https://www.techinasia.com/talk/opinion-alibabas-mall-shows-o2o-real-business-model
