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Retail digitalization is spreading quickly with the transformation of retail and services becoming increasingly accessible remotely.

Retail digitalization is spreading quickly, not only with the generalization of tools such as internet connected PCs and smartphones, but also with the transformation of retail and services becoming increasingly accessible remotely. The crisis of Covid-19 has also certainly hastened the trend with many everyday purchases becoming digitalized. While online sales surely provides convenience and rapid access to a broad selection, it may also come at the expense of benefits received from physical outlets.

Zero Point of Sales for customers…

On the bright side of things, buying online is known for providing convenience and larger choice during the purchasing process. Moreover, customers may easily access a lot of additional information on the production process, components, complementary products to add or similar products to compare with. Online shopping ensures anonymity in the purchase with no feeling of any kind of pressure from a salesperson to buy a particular item and equal treatment of all customers, even if one is purchasing for a small amount. Finally, one has the possibility to track progressively the amount to be spent when adding each item. On the dark side, buying online takes away the human component and the experiential dimension of an in store purchase. Indeed, the lack of personalization and customized service is a key weakness of online shopping. Also, it is not possible to physically touch and try a product before purchase which may come with some risks of picking up the wrong item.

Zero Point of Sales for retailers

While online shopping represents an opportunity for extending its customer base and giving access to a wide choice without the cost of having it on the shelves, it also has some limits. It becomes harder to guide customers and convey the brand image. Also, it requires additional resources to guarantee a high level of integration across channels. Finally, it might become more difficult, when lacking the full brand experience and when easily comparing between products, to have customers accept price premium for high-end luxury products where the service and selling ceremony components are essential.

Towards a sweet spot for everyone?

For both players, it seems that online shopping may appear as an additional channel but not as a replacement. Especially for the two extreme of the customers spectrum: on the low end, for customers who are not experienced with the brand or the category of products purchased, recruiting them becomes harder online; on the high end, for customers who are loyal and high spenders, customizing the purchase and making them feel special also becomes harder online. As such, for the standard, more familiar and functional complementary purchase, online stores could one day replace physical outlets. However, to discover new brands or products, or to enjoy the experience and recognition as a top customer of a cult brand, then online stores may never be enough.

The live session will be animated by Dr. Gwarlann DE KERVILER, Associate Professor of Marketing and currently Head of Marketing and Sales Department at IÉSEG. She has a strong expertise in teaching and research with publications in top marketing journals. Her areas of interest cover a broad spectrum, including digitalization of physical outlets, mobile shopping, online reviewing, luxury consumption and influencer marketing. Before joining IÉSEG, Gwarlann worked many years as a marketer for major companies in France and in the US.

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