Retailigence

“Club of Knowledge Hunters”

Retailing v/s E-tailing

Posted by retailigence on February 8, 2012

Retailing is the function when any firm provides a product or service to the customer. Delete the ‘R’ from retailing and you get e-tailing. To an observer this might sound like a casual game, but the fact is, e-tailing is serious business. The retail model is widely understood and practiced around the globe. Many people assume that the e-tailing model is just an extension of the retailing model; however nothing could be farther from the truth.

The first major difference is that when we talk of retailing we also know that the competition is known and well defined. Any related business which is in proximity or within the driving distance would be the natural competitor. This is not the case with e-tailing because when a shopper goes in for online shopping, the online store is forced to compete not just at the national level, but sometimes even at the global level. The human to human contact is negligible in e-tailing.

When we talk of retailing, one important factor which comes into play is that the retailer generally has a long term relationship with the customer and the retailer is well aware of the needs and wants of the customer. He is also aware of the wallet size and which products are preferred by the customer. He is in a position to provide better service to the customer. This personal contact is lacking in case of e-tailing. But this shortcoming is gradually being addressed as now the e-tailers look to maintain vast amounts of data about their actual and potential customers. This is one reason that online shopping is gradually picking up in developing countries.

Technology is of paramount importance to the success of e-tailing. It is the lifeline for the success of any e-tailing business. Continuous upgrading of technology is also important. One can find products like underwear, shoes, lens, bags, cosmetics etc on  e-tailing plateforms

 It also needs to be considered that the e-tailing businesses have lesser gestation periods. Physical infrastructure is not required. Setup costs are considerably less and wider markets become accessible. This is unimaginable with retailers.

 Shoppers have more control over the shopping experience in case of e-tailing as compared to retailing. The Internet provides all related information at the doorstep of the customer. With e-tailing, the option of price control just goes out of the window.

 It is a well documented fact that the most of the costs attached to a product are added after the process of production is over. And a significant portion of these costs is the marketing, selling and warehousing costs. These costs are significantly less in case of e-tailing, which in turn translates into better pricing.

 The speed and convenience of interaction is much more in case of e-tailing. And this often results in better sales volumes for the e-tailers.

The majority of the Indian population today is young ,disposable income is higher as compared to previous generations, both the partners are often working, lifestyle is more hectic, leaving lesser time for visiting the retail store. As people are more tech savvy nowadays, e-tailing is a made to order solution to address these challenges. Nearly all products from briefs to razors, from Gillette to Jockey products are available when the consumer goes in for online shopping. E-tailing is a step into the future.

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