Even before the e-commerce era began, business, particularly retail, meant having a brick and mortar store where customers could come to make purchases. But then e-commerce happened and took the center stage.
In terms of data from Kearney Research, the retail industry in India is projected to rise at the rate of 9% during 2019-2030 to grow beyond the bar of US$1.8 trillion by 2030. As a part of it, India’s e-commerce market is aimed at reaching the US$ 350 billion mark by 2030 (Source).
Do these numbers imply that offline retail has lost its charm? The numbers paint a picture opposite to what is expected. Kearney Research also expected the offline retail revenue to grow by US$ 2.77 billion in FY2020 alone.
This has made many trade pundits believe that the next level of business growth will come from the convergence of the e-commerce and offline retail industry. The section where these two industries converge can be considered the ‘Bricks and Clicks’ business model.
If you are wondering where this leaves offline brick and mortar business owners, the simplest answer is the timely adoption of the Bricks and Clicks business model. While there is nothing wrong with solely running an offline business or e-commerce business, combining the two into a unified retail strategy can make wonders happen for your business.
How does the Bricks and Clicks business model work? Will it work for your business? Is it worth your time and effort? Let’s unravel many such questions in this complete guide.
What is the Bricks and Clicks Business Model?
As mentioned above briefly, the Bricks and Clicks business model refers to the expansion of business in a way that combines selling products through a physical retail location (bricks) along with an online store (clicks). You may also find it to be called the ‘Click and Mortar’ or ‘Clicks and Bricks’ business model.
At its core, this model allows you to benefit from two unique sales channels that work in coherence with each other under a unified retail strategy. This combination also gives you the opportunity to offer more purchase options to your customers, which will ultimately increase your brand reach and profitability.
In most cases, the Bricks and Clicks business model is applied to businesses that already have physical retail stores and then plan to open an online store. However, the reverse side is also true – that is, many popular online e-commerce businesses are now expanding in the offline retail space by setting up their brick and mortar stores (Example – Lenskart and Cashify).
In either case, the implementation of this model will be specific to your business, what you sell, and how you want to sell it further. Regardless of its implementation, the model is based on certain fundamental principles you must be aware of.
Core Principles of Bricks and Clicks Business Model
Operational flexibility
You can implement this model with the goal of providing your customers the choice of buying from you – either online or offline. This can also include streamlined returns to allow the shoppers to make returns in the nearby physical stores.
Unified customer shopping experience
By unifying the two retail channels, you can plan to create and deliver more convenience to your target customers. For example, a buyer can check online if a particular item is available in the nearby store before paying a visit. Similarly, if an item is available both online and offline but would take more time to get delivered to his/her home, they can simply buy it from a nearby location.
Easy switch to omnichannel retail
With the changing consumer behavior, omnichannel retail is slowly becoming the new norm. Most renowned brands have started integrating their online and offline sales channel to avoid getting left behind in the wave of omnichannel disruption.
Opportunities for brand growth
By enabling the buyers to shop wherever you want, you can not only attract a wider audience but also leverage opportunities for cross-promotion. For example, you can benefit from the trust built on secure online payments to drive more in-store footfall. Similarly, you can direct in-store buyers to make online purchases for better rewards.
Before you rush toward spreading your wings under the Bricks and Clicks business model, let’s get into its merits and demerits.
Pros and Cons of the Bricks and Clicks Business Model
Pros:
- If you are already providing delightful in-store customer experiences, adopting this model of business will help you sell more far outside the local region. It is up to you to decide if you want to sell your products in multiple Indian states or even outside India.
- By following this model, you can stay competitive in the market while also catering to more customer preferences.
- You can integrate omnichannel payments to allow your customers to pay you the way they want.
- You can also get more insights related to customer preference to help optimize your offerings. For example, meeting buyers in your physical retail store gives you the opportunity to ask for feedback that can be implemented in both offline and online channels.
Cons:
- Maintaining the operations of both offline retail stores and an online store will come with additional overhead costs, which can be potentially cost-prohibitive for some businesses.
- Businesses that only have experience in selling through traditional offline business models may find it quite challenging to learn how to leverage a new sales channel.
- Managing inventories across both sales channels, implementing the learnings obtained from customers’ feedback, and ensuring hassle-free customer experience will require more time, money, and human resources.
If you still think you can take the route to the Bricks and Clicks business model, we have something more for you to keep in mind.
4 Tips to Implement the Bricks and Clicks Business Model Right
Leverage product and payment analytics data
The right implementation of this model will provide you with significant data about customer preferences, product bestsellers, and the most preferred payment methods on both channels. You can utilize this data to enhance the buyer’s experience on both channels while also benefiting from cross-selling or up-selling based on the previous purchase history.
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- Change the product merchandising approach
This means changing the way the products are displayed on your offline store and segmented for better highlights along with ensuring the ease of navigating the space for the buyers. In the online store context, it implies focusing more on product photography, descriptions, and the ease of checkout for customers.
Maintain a consistent inventory
The Bricks and Clicks business model allows your customers to browse the product range online and buy in-person, and vice-versa. This is why it is important to keep the product inventory consistent and synced across both channels.
Simplify shipping and returns related to your business
While selling both online and offline, you would want to ensure that shipping and returns are as easy as possible for the buyers. In an ideal scenario, buyers should be able to order products from your brand online or in-store and get them shipped to their doorstep. On the other hand, they should be able to return by placing a return/pick-up request or in-person via the local store.
FAQs
What is meant by bricks and clicks?
The bricks and clicks business concept refers to the business model that entails selling products via two channels – an offline brick and mortar store and an online store. It gives customers the flexibility to shop from a brand as per their preference.
What is the advantage of the bricks and clicks model?
The bricks and clicks business model comes with significant advantages for both pure brick and mortar and e-commerce businesses. For instance, a business targeting only local customers to an offline store can expand its reach and gain more customers through an online store. On the other hand, an online business can penetrate deeper into the tier-2 and tier-3 markets by adding one or more offline stores.
What is the other term used for bricks and clicks model?
It is also referred to as ‘clicks and bricks’ or ‘click and mortar’ – each of which represents the same underlying model for unification of two different sales channels – online and offline. It also allows merchants to operate and test their business ideas at both fronts.
How is the brick-and-mortar model different from bricks and clicks?
Brick and mortar basically refers to the businesses that operate via offline stores catering to nearby customers in person. However, the bricks and clicks model merges the offline selling model with an online store, hence allowing business owners to sell both online and offline.
The Bottom Line
At the end of the day, the evolution of the Indian retail industry shows good signs of accepting the Bricks and Clicks business model as a part of small and large businesses alike. After all, every business owner wants more customers, higher sales, and business growth.
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