Black Friday Weekend's Unreported Story: The Rise of 'Bricks and Clicks' | Street Fight

Black Friday Weekend’s Unreported Story: The Rise of ‘Bricks and Clicks’

Black Friday Weekend’s Unreported Story: The Rise of ‘Bricks and Clicks’

Female holding shopping bags

A veritable deluge of shopping data came out of last week’s “Cyber Weekend.” The torrent of articles that followed told essentially the same story of online commerce gaining on traditional offline retail.

That narrative asserted ecommerce grew while traditional store sales declined, which is the straightforward interpretation of the data. The other important story of the weekend, which I won’t go into here, is about the new power and role of smartphones in the path to purchase.

The online vs. offline retail story is as old as the internet. Early analyst predictions that traditional stores would eventually disappear in the face of the ecommerce juggernaut have yet to come to fruition. More than 20 years later, ecommerce has yet to crack 10 percent of total retail sales.

Focusing on the “online surged, offline struggled” data story obscures a deeper understanding of the evolution of shopping. It also diminishes the importance of physical stores in a more convoluted and fragmented consumer purchase path.

I would argue that physical stores, regardless of their sales figures, offer a critical customer experience and a kind of “brand anchor” that support ecommerce for traditional retailers. Stores drive online sales because they instill a sense of confidence and trust in the consumer.

Indeed, the mostly unreported story of Black Friday weekend is that much of the ecommerce growth came from “bricks-and-clicks” retailers, not pure-play e-tailers. Whereas Amazon and, to a much lesser extent, eBay saw growth, stronger gains came from omnichannel players such as Walmart, Target, Best Buy, Sears, and others.

According to data from ChannelAdvisor, Amazon saw a 24 percent increase in sales during the five-day period measured (Thanksgiving to Cyber Monday). However, bricks-and-clicks retailers witnessed an average of nearly 83 percent growth over 2014. And Amazon is nearly alone among ecommerce providers in its brand strength and level of success.

In-store sales were just over $20 billion for the full Black Friday weekend period, according to ShopperTrak. By comparison, Adobe estimated that consumers spent approximately $4.45 billion online. Later, comScore announced that spending exceeded $3 billion on Cyber Monday, making it the “heaviest US online spending day in history.”

Looking only at those numbers, one would probably agree that online was cannibalizing traditional retail store sales. Yet traditional retailers with ecommerce are the ones that are gaining. With only a few exceptions (e.g., Amazon and perhaps Wayfair, whose sales also surged this year), pure-play online retailers are at a huge disadvantage vs. so-called omnichannel retailers, though the latter often don’t get the “e-customer experience” quite right.

Mobile “showroomers” use the physical retail store before buying online, whether at that retailer or somewhere else (although more often at the retailer). The physical retail store also is critical for returns, which play a huge role in online buying. The idea that a consumer can take a risk on an unseen item because it can be returned locally is a critical consumer confidence builder and competitive advantage for the local branch of a multi-location retailer.

In fact, the perceived convenience of in-store returns and exchanges makes this the preferred option over online by a factor of nearly eight. According to an early 2015 survey from Retale, the majority of consumers (70 percent) “prefer to return or exchange gifts in-store, while only 9 percent prefer to do so online and 21 percent…had no specific venue preference.”

All that is to say: Physical retail stores factor heavily in the consumer buying decision. They play a critical role in brand building and consumer confidence building. And they are critical for ecommerce as well. Turns out the store will continue to play an important role in the future of retail.

The superficial take on Cyber Weekend shopping data is the story of ecommerce growth at the expense of traditional stores. But the more accurate and more interesting story is about the symbiotic relationship between stores and ecommerce growth.

It’s not bricks vs. clicks; it’s bricks and clicks.

Greg SterlingGreg Sterling is vice president of strategy and insights for the Local Search Association (LSA). He is also a contributing editor at leading tech blogs Search Engine Land and Marketing Land. Sterling has been conducting research and writing about location-based and small business marketing trends since 2000.

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