Daily Review: Online + Offline = The Future of Retail

MEDICIGlobal Head of Content

Contrary to the widespread belief that physical retail is widely believed to be playing a diminishing role in modern lifestyle, the future of commerce will be at the intersection of online and offline worlds. Amazon + Whole Foods, and now Alibaba + Sun Art are defining the winning strategy in global commerce.

Chinese online shopping giant Alibaba pins its hopes on physical stores as it buys hypermarket chain for £2.2 billion

  • Alibaba will buy a 36% stake in Sun Art as it tries to cash in on China's $500 billion food retail sector.
  • Since 2015, Alibaba has invested around £7 billion in physical stores.
  • The move follows Amazon's £10.3billion purchase of Whole Foods earlier this year, allowing the organic grocery chain to cut prices on its best-selling staple products and begin a delivery service for customers.

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No longer brick-and-mortar vs. online retail: Customers view a ‘single lens’

  • Despite the ease of online shopping, consumers still crave the tactile experience of physical stores.
  • Rather than pitting the two channels against each other, retailers can secure a much larger wallet share by giving consumers the best of both worlds through the adoption and use of new technologies.
  • By offering complimentary benefits, as well as engaging customers via mobile, both in-store and online retailer channels can strengthen overall customer engagement and brand affinity. And the best news for retailers taking an integrated approach: higher revenues and profitability.
  • Examples: Amazon + Whole Foods, Walmart + Bonobos, Walmart + ModCloth. 
  • The “look before you buy” experience requires a certain level of physical presence. Examples: Casper + Target partnership, Amazon’s Prime Wardrobe, etc.
  • Online comes together with offline through various beneficial strategies: added offline incentives based on online purchases, payment perks, a more personal customer experience offline integrated with rapid inventory availability online. Examples of blended omnichannel strategy: Best Buy, Home Depot, etc.

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Elena Mesropyan

MEDICIGlobal Head of Content

Global Head of Content, MEDICI

Elena is a research professional with a background in social sciences and extensive experience in consumer behavior studies and marketing analytics. She is passionate about technologies enabling financial inclusion for underprivileged and vulnerable groups of the population around the world.