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E-commerce or bankruptcy

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For large and well-known chain shops and popular brands, there comes a time when there is no future without online sales, without combining channels through omnichannel. Paradoxically: those only now entering the world of online sales can benefit from the annuity of the late comer, gaining an immediate competitive advantage.

According to the latest edition of the annual report 'Global Powers of Retailing 2018: transformative change, reinvigorated commerce', prepared by consultancy Deloitte, although as much as 90 per cent of global sales still take place in traditional shops, the battle for customers is increasingly taking place in digital channels.

According to Deloitte data, 56 cents of every dollar spent in a traditional store is the result of contact customer with digital channels. Three years ago, it was 36 cents. Those who shop across channels spend more than twice as much as those who shop only in brick-and-mortar stores. That means retailers need to plan holistically and operate across all channels, regardless of whether the final sale takes place in a brick-and-mortar store or online.

And this is where the key word comes in: omnichannel. It is about serving the customer in an integrated way across all possible channels. We do not divide customers into online and stationary. If a customer buys online, he or she can return in a stationary shop and make complaints via Facebook. The most commonly used channels are the World Wide Web, online shop, stationary shops, social media, mobile devices, mailing, call centres, home services, as well as games consoles or smart TV.

Lizard Media is constantly monitoring and researching the extent of omnichannel implementations in various industries. The reports "Omnichannel research in Poland" show that the shop chains of the leaders of certain industries in Poland, DIY shops, i.e. Castorama, Leroy Merlin or Jula, are very advanced in customer service in all possible channels. They integrate online shopping, offline shopping, customer service, complaints and returns, as well as all the information that comes to the customer through official channels. Representatives from other industries, such as jewellery retailers, as well as bookshops or grocery shops, are raising their level of implementation at a rapid pace.

At stake is not only the development of an online sales market worth more than PLN 40 billion (in 2017), but sales in all channels, including the traditional one - stationary shops.

Problems of large traditional brands

As PMR Restructurings SA specialists point out, there is a whole group of traditional Polish brands operating for many years in the retail sector that still do not have an online shop, losing market share and initiative from year to year.

- These companies are often family businesses in which the traditional sales model and philosophy based on a large network of brick-and-mortar stores have been cultivated for 20-30 years. Their owners, often middle-aged or older people, do not understand the changing reality, new consumer habits and customer service through various channels - says Małgorzata Anisimowicz, president PMR Restructuring SA. – As a result, companies with huge traditions and achievements, often innovative on the market, are facing bankruptcy due to technological backwardness and lack of willingness to invest in online sales – adds Małgorzata Anisimowicz.

The material appeared on brief.co.uk:

4 May 2018:
" E-commerce or bankruptcy
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PMR team

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