Chris Walton, Forbes.com
One of the prevailing fallacies within the industry right now is that it is easier for a physical retailer to learn digital retailing than it is for a digital retailer to learn physical retailing. It is an enticing argument to make — physical stores make up a larger proportion of sales than e-commerce, there is an intuitive side to in-store merchandising, store supply chains take time to build, etc. — but the overall arguments are ones of a priori hindsight.
Looking into the crystal ball though, the industry will soon see that it is FAR easier for digitally native brands to get physical than vice versa. So, Walmart, Macy’s, Kroger, et al., if you are listening, be afraid.
Be very afraid.
There are five reasons why going from digital to physical will be easier than going in the opposite direction over the long-term.
The five key reasons are:
#1 – There is more “margin” for error in physical stores
As Rob Lowe used to say in Parks and Recreation, physical stores literally have more margin for error than e-commerce.
Physical stores are awash with margin relative to e-commerce for one simple reason — shipping costs. While e-commerce retailers carry the burden of delivering products to consumers on consumers’ own schedules, physical stores have always benefited from a Field of Dreams “if you build it, they will come” laziness.
For centuries, stores were the only game in town, and, as a result, consumers made a bargain with the devil that, in exchange for limited-option convenience, they would willingly act as default warehouse pickers and quasi-third-party-like delivery agents to get the goods to their homes.