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| Noel Leeming has a great web shop |
Continuing my posts on how the web is changing the supply chain . . . last time I looked at the recent phenomenon of
daily deals sites. These web-only stores are certainly selling to the customer by removing the retailer and perhaps the distributor from the chain, a process referred to as
disintermediation.
This time I 'll look at the websites of traditional stores and ask are these players actually removing any intermediaries at all?
A web presence is pretty much expected for just about any business in 2013 but for any operator who sells to the general public, it's an essential.
At the bare bones minimum,a web site should provide full details of where any bricks-and-mortar stores are located and how they can be contacted - phone and email as a starter.
However, any internet shopper who seeks out the website of a retailer and finds only this wireframe presence is going to be seriously underwhelmed and may well flick straight off to find a more engaged competitor site. The internet shopper is a on a mission - to seek out new civilisations . . . sorry, got a bit carried away there. The internet shopper wants information fast and if he/she doesn't find it here, there's generally someone else on the net who can provide it.
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| (Soon to go) Bond and Bond |
Some retailers understand that the web is now an essential shopping channel, particularly if their business is selling technology goods. Others have yet to get the message unfortunately and I'm sure that this lack of market understanding must be hurting their business or at least limiting new sales opportunities.
I'll refer to a few local market examples to illustrate the point.
Noel Leeming (and the soon to be defunct
Bond and Bond - two names, same owner, little point of difference) have invested heavily in building a full blown shopping website that features all of their high street merchandise and more besides. Noel Leeming was the first national electronics retailer to jump onto the web and it shows. This is a mature, fully featured web shop as good as any overseas site - easy to navigate, good product information, clear pricing, and internet shopping with delivery to your door via courier.
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| JB Hi-Fi is a recent arrival in NZ |
Dick Smith Electronics offers much the same in capability - the New Zealand site is a clone of the Australian one but it's fully customised to support the local market. Dick Smith is particularly good at offering daily and weekly specials that are offered only to the online shoppers, not to shoppers in the physical retail stores. An added sweetener for the web shopper is free courier delivery on just about anything. If you know what you want and don't need to actually see it first, the website is far more convenient than heading for the retail outlet.
JB H-Fi is an australian import that's made quite a splash with a few large stores and they have an impressive web presence. All the specials they offer in store are replicated online and they offer free shipping too. It's a tricky site to search but it has an impressive catalogue of goodies that may well appeal particularly to provincial people who don't have access to a physical store. There are other high street giants that have also spent substantial time and money building strong web channels -
The Warehouse,
Warehouse Stationery - plus others with maybe a lower commitment but still some reasonable shopping capability, like
LV Martin or its owner,
Smiths City.
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| Aussie import Harvey Norman |
Compare these fully featured web shopping sites with
Harvey Norman. Good ol' Harvey has fast established himself as a major player in the New Zealand electronics (and furniture) retail space since arriving here from across the ditch. However, Harvey is very much a bricks and mortar operation, as is shown by the below par website. OK, it's got some nice graphics and pretty pictures but visitors will soon find that it's not a fully-formed shopping site to replicate the diverse range of the retail stores. There's some product here but not a lot. Perhaps this is a deliberate decision. After all Harvey Norman stores are run by owner operators so any commission from web sales is not going to be passed on to them. This approach may also apply with other owner operators like the 100% stores, who have a frankly low-grade web presence.
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| Woolworths-owned Dick Smith |
For the Noel Leeming and the Dick Smith type operators the web channel is not replacing their bricks and mortar operations but is instead bringing in much needed additional cash flow via the internet. I've no idea whether their return on investment is paying dividends but as a keen buy I am certainly more drawn to these stores because they offer me good price and feature research opportunities, which may well translate into an actual purchase.
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| NZ stalwart The Warehouse |
This shopping model, unlike the online line only operators like
Fishpond or
Mighty Ape, has not cut out the middleman. Perhaps in some of these business it is the franchise owner who is selling direct to the public via the web channel, thus cutting out the franchisee who runs a retail outlet that is completely separate to the website, but generally the big New Zealand high street retailers appear to be running their own stores and the web site serves as an additional channel to the physical outlets.
I don't know if I'm a typical shopper or not but for what it's worth I am far more likely to spend my disposable income with retailers who have given me the pleasure of a great browsing experience than ones that left me disappointed at their lacklustre efforts.
