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5 Advantages of Brick & Mortar Over E-Commerce

There are countless articles about how e-commerce has it all over traditional brick-and-mortar businesses. Sure, e-commerce has expanded the retail business, but that does not mean that location marketing doesn’t have significant benefits. For wholesalers and retailers with limited inventory, there are some places where the brick-and-mortar business excels over e-commerce. When location and personal brand reputation are at stake, that’s when brick-and-mortar has the edge.

The Problem With A Middleman

Whether you manage it yourself or use a third party like Amazon, having an internet sales department adds another step to the retail transaction. In the business world, we call these intermediaries. Using an intermediary dilutes the control that you have over your product. Take the extreme case of a street vendor. This sole owner has total latitude over pricing. If he likes your face, he can cut you a deal. If he is down to one item then he can up the price because it is in demand. Using an intermediary outside of your brick-and-mortar business removes that ability to rapidly readjust your price point.

Brand To Face

Millions of consumers simply do not trust online purchasing and report feeling more comfortable giving a credit card at a physical location. Oftentimes this is due to a simple lack of knowledge on how to shop safely online. It is more difficult to establish brand trust without the benefit of a building in which people can browse and meet with salespeople. An online presence cannot compete with meeting the founder and owner face-to-face. Generally, this can only happen at the place of business.

The Problem Of Surplus

Online shopping means being part of a world market. At first blush, it may seem like selling one thousand shoes is better than selling one hundred until you think through the logistics; Where do you store your stock until it sells? How much does that warehouse cost? But at some point you need to have a physical product and the ebb and flow of the surplus will prove incredibly important to your bottom line. A small brick-and-mortar establishment allows you the ability to physically control your stock, redefining price points for surplus items. This can also be true for a small internet store, but a lot of businesses choose the route of e-commerce based on the potential for high sales volume.

The Problem With Twitter

The world of social media marketing is not all wine and roses. Reputation management is a lot of work and most business owners do not enjoy it and end up ignoring the importance of a solid online brand. This can destroy a business. Because brick-and-mortar companies depend on local marketing, building an online reputation can take a backseat, so when a customer is unhappy with the brand, there is an opportunity to talk it out in person; a huge benefit of the mom-and-pop model, as It is scientifically harder to speak poorly of a person when you’re looking him or her in the eye.

Big Competition

Being part of a world market means that everyone can be a customer. It also means that everyone can be a competitor. If your brick-and-mortar company has a rural, geographically focused marketing base then it would be a bad idea to invite competition from all over the world. Simply focus your marketing efforts on your customer base.

 

Contributed by Paul Reyes-Fournier, who has served as the chief financial officer for social service organizations, churches and schools. He created his own marketing firm, RF Media. Paul holds a BS in physics and an MBA.

Photo Provided by SocialMonster.org with permission to use. 

 


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