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How click-and-mortar differs from brick-and-mortar business model

E-commerce · 5 Mins Read

How click-and-mortar differs from brick-and-mortar business model

Gone are the days when small and medium enterprises (SMEs) and large retailers used only the brick-and-mortar business model. With the advent and success of e-commerce, more and more businesses are moving towards an omnichannel approach where they operate online and offline. This is known as the click-and-mortar business strategy. 

A click-and-mortar business incorporates omnichannel marketing and operations to offer consumers an enhanced and integrated experience, meaning they will be able to connect the dots between both offline and online presence of a brand. Before understanding how omnichannel retail strategies can work for your business, it’s vital to analyze its traditional counterpart – the brick-and-mortar system – and where it falls short. 

What is considered a brick-and-mortar business?

The definition of a brick-and mortar-business is simple. Brands that operate from physical stores without any online presence can be characterized as such. There are plenty of benefits for the business owner. They can have more personal interactions with customers at these brick-and-mortar stores, where they can view and/or try your products, immediately have their questions answered, and then decide whether to make a purchase or not. They’ll also save on shipping charges.

Why click-and-mortar is the next best alternative

The advent of e-commerce has opened new avenues for businesses, with the most successful one being the click-and-mortar model. It allows companies to establish their presence online and combines the advantages of the brick-and-mortar business model. 

In 2021, there were 2.14 billion online shoppers, which is over a quarter of the world’s total population. This means brick-and-mortar businesses have a wider customer base to cater to, one that can be global. Where physical stores can only attract customers in the vicinity, online shops have a wondrous playground to grab their market’s attention and establish online branding, through various digital marketing channels like social media, without any geographical restraints. That’s not to say businesses should permanently switch to the e-commerce space. Since 82% of shoppers prefer to view and feel a product before purchasing them online, a click-and-mortar business will be able to offer the real-time physical experience alongside the convenience and flexibility of making purchases in the digital realm. For businesses expanding globally, setting up physical stores in various countries enable them to cement brand presence and facilitate more productive online shopping.

There are different ways to establish a click-and-mortar business. You could place your products on marketplaces like Lazada, which local brands like Happy Skin and BLK Cosmetics have already done so. Alternatively, establishing social media selling and a personalized webstore can also do the trick – local apparel store, Bench, is a great example.

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How SMEs can adopt a click-and-mortar model in the Philippines

In this modern technological era, one can define brick-and-mortar business as old school, which does not incorporate the various advantages an online platform can provide. At the same time, having only a digital presence may take away the much-needed physical interaction customers long for before they make a purchase with a brand. The click-and-mortar model defines an omnichannel retail strategy that combines the merits of both a physical and online store to provide a wholesome consumer experience. 

Benefits of SMEs in the Philippines adopting this omnichannel business model include:

  • Convenience for customers: SMEs can offer customers the choice to place an order online and collect it from the physical store if they do not want to wait for it to be delivered or pay the shipping fee. This can bode well for tourists who have seen the online store but wish to try out the product when they visit the country. 

  • Better consumer experience: SMEs enable customers to visit the physical store to get an idea about the touch, feel, and sizing of a product before purchasing online. 

  • Increased revenue: SMEs can study customer behavior and optimize their store after analyzing customer data collected. For example, when customers log into the store’s Wi-Fi, their movements can help generate a heatmap, allowing the business owner to understand the sections most visited by customers and analyze their interests and needs. The same can be gathered through the e-commerce store – popular purchases can be tracked, allowing opportunities for more creative sales strategies. Business owners can also anticipate peak periods and have stock ready ahead of time to cater to online demand.

How retailers in the Philippines are betting on click-and-mortar

According to the Department of Trade and Industry (DTI) in the Philippines, the number of online sellers increased from 1,700 in March 2020 to 93,318 in January 2021. Before Philippines largest mall operator SM launched their their very own e-commerce store, ShopSM, they had previously leveraged the power of marketplaces, which took their business to greater heights. SM’s online sales on Lazada marked progress in the Philippines e-commerce scene, a trajectory less patronized due to fear of digital payments, low ownership of bank accounts and a deep-rooted mall culture locally. Homegrown brand Bench combines the omnichannel experience across 516 global physical stores, online shop and outlets in marketplaces like Shopee, Zalora and Lazada, and was able to pivot even during the pandemic, signifying the need for a click-and-mortar approach for brand sustainability even during economically challenging times.

How DHL Express can help SMEs in their omnichannel business strategies

DHL Express can help bridge the gap between the physical and online realm as you focus on expanding your business overseas. Being a reliable express delivery provider, our suite of express courier services have made time-definite shipments possible for many local businesses wanting to ship their products from the Philippines to the rest of the world. We can help you shift away from the brick-and-mortar system to an omnichannel model effectively with quality and safe logistics strategy at preferential rates, perfect for SMEs looking for a cost-effective solution for international shipping. Get started with a business account on DHL Express today!

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