The internet will kill brick-and-mortar retail. That’s a prophecy that has proven at least partly true in 2017 as thousands of chains have closed stores, while others shut down for good, and quite a few remain at risk in 2018.
Retail has become increasingly digital, but most shopping still takes place in stores and digital retailers have discovered that, in many cases, there’s a benefit to having a brick-and-mortar presence.
In some cases, that can be simply to facilitate returns. That’s why Amazon (NASDAQ:AMZN) has a deal in place with Kohl’s. The chain allows customers to drop off items they want sent back to the digital retailer.
Amazon has also shown through its purchase of Whole Foods that having a physical presence can help expedite delivery. The roughly 400 grocery stores add to the digital leader’s warehouse network, giving it more points to stage orders from.
Most digital retailers, however, have much smaller ambitions. For companies specializing in a more narrow range of products, opening brick-and-mortar locations may make sense simply for the data it can gain from in-person customer interactions.
What is “brick mining?”
While it’s not yet a mainstream term, “brick mining” is the idea that an online retailer can learn about its customers from having a limited amount of physical stores. The term was used by sportswear subscription retailer Fabletic’s retail vice president, Ron Harries, to explain why his once pure-digital employer has begun opening stores.
“When you take the data that you collect from that customer in a retail location, you can get to know your members and guests much differently than you could online only,” he told Marketplace.
There’s a practical reason for customers to visit a physical Fabletics location that should help the company’s digital sales going forward. When a customer finds the right fit — something it’s not easy to do online — she can then order again (online)…