Industry Insights

E-Commerce vs. Retail Store: Which Should You Focus On?

Dec 14, 2023 • 5 min read

80 percent of the American population shops online.

That’s almost 263 million potential customers! Yet most consumer purchases still happen in brick-and-mortar stores… So, what should you do?

If you’re wondering which channel you should focus on, you’ve come to the right place. E-commerce continues to explode in popularity and small internet retailers are popping up everywhere, offering bespoke products and convenience.

Yet physical retail stores are still popular. How can you capitalize on both channels?

This article highlights how you can do both — run a brick-and-mortar and online store — successfully. We’ll dive into the pros and cons of both channels, and show how having the right strategy and tools can help drive your success.

E-Commerce vs. Retail Store: A Dual Approach?

Physical retail stores continue to be popular. Many customers love the ability to walk into a store, find products they love, maybe try them on, and enjoy their experience. Other customers love the convenience of online shopping — they don’t have to leave their houses — and the ease of purchasing the products they want with the click of a button.

But what does this mean for your retail store? Should you focus on creating an incredible experience in your brick-and-mortar business? Or channel your energy into building a thriving e-commerce store?

Why not both?

The two don’t need to be mutually exclusive. An omnichannel approach blends online and offline channels. Your online store can complement your retail store (and vice versa) when you integrate them properly.

There are various tools you can use to bring your stores together. One such tool is a modern point of sale (POS) system that fulfills online orders from in-store inventory and syncs sales data across channels. You can provide convenience and a personal touch.

The key is providing a consistent experience across channels. Let’s explore the difference between e-commerce vs. retail stores, including the pros and cons of both.

Understanding E-Commerce: Limitless Reach, but Virtual

E-commerce refers to any transaction completed online. Customers can browse and purchase products from your online store without setting foot in your physical business. Payment, order fulfillment, and returns happen digitally.

Pros: Online stores have no geographic constraints. You can sell to customers around the world. Your business is open 24/7, so customers can shop whenever inspiration strikes. If you choose the e-commerce-only route, you’ll also benefit from lower overheads. Startup costs are lower compared to outfitting a storefront.

Cons: There’s a lack of physical interaction, both with your products and with other humans. Clicking on images isn’t the same as feeling, touching, and trying on products in your physical store. You’ll also find more competition online — rivals are no longer restricted to locality.

While e-commerce is convenient and has an incredible reach, some consumers value and prefer real-life shopping.

Exploring Retail Stores: A Tangible Customer Experience

Physical retail stores have been the backbone of commerce for decades. Walking into a brightly lit space and browsing the newest products is still exciting. And with associates ready to offer a personalized experience, customers feel special.

Pros: Online channels can’t fully replicate the tangible engagement retail stores offer. Shoppers can have hands-on product interactions, ask questions, and walk out of your store with their products — they don’t have to wait for delivery.

Cons: Your retail store has geographical limitations — you can only target local residents and customers within driving distance. Depending on your location, you’ll have high operating costs, like rent, utilities, and staff.

Retail stores have the human touch, but contend with high operating costs and location constraints.

Bridging the Gap Between E-Commerce and Retail Stores

Instead of pitting e-commerce and retail stores against each other, consider an omnichannel approach. 56 percent of modern consumers prefer to shop online, but that still leaves 44 percent of potential customers you could reach with your physical store.

With the right approach and tools, you can provide a consistent experience. Your POS system has various features that facilitate using both channels, including:

E-commerce integration: Customers can browse your online store, ask associates questions via chatbots, email, or phone, and then click-and-collect purchases on the way home. Offering BOPIS (buy online, pick up in-store) and curbside delivery is easy with a modern POS system.
Inventory management: You need a single product catalog shared between your website and in-store POS to sync stock. With e-commerce integration, selling a product in-store is reflected across all channels in real time. Warehouse management is easier, and product listings show correct pricing and up-to-date availability. Excellent inventory management software offers tools like alerts for low stock, automatic stock replenishment, label printing, real-time metrics, vendor management, and more.
Detailed data and reporting: Having a physical and e-commerce store might feel like double the work, but with unified reporting, you can access analytics on customer behavior, inventory movement, and sales trends. When you know what’s selling well across both channels, you can make sure you always have available stock.
Lower operating costs: An e-commerce store is cheaper to start and run. And a POS system that links your channels helps reduce costs further! You’ll save hours of counting stick with automated inventory management. Pricing is synced, and your staff can focus on providing stellar customer service. You can also forecast inventory needs, reduce carrying costs, and avoid overstocking.
A consistent customer experience: Customers expect the same service online as they get in your store. With customer management and integrated loyalty programs, you can provide a personalized customer experience. Collect customer data and preferences in your physical and online stores — from website analytics and purchase histories to browsing habits and demographics. Use this information to provide discounts, promotions, and loyalty rewards.

Most important is providing a seamless experience for customers. You want an e-commerce integration that makes your life easier while providing convenience to shoppers. Before starting your e-commerce journey, look for:

A mobile-friendly, responsive design
Online and offline channels sharing customer information like order history and preferences
An intuitive website platform
Options to buy online, pick up in-store, or ship-to-store to add flexibility for shoppers
Simple online checkout with shipping rates that adjust based on cart contents
Capabilities to quickly handle returns, exchanges, and other issues

E-Commerce vs. Retail Store: Which Is Best?

So, which is best?

Both!

It’s not a question of e-commerce vs. retail stores; it’s more about making them work together. The benefits of an omnichannel approach are clear:

You can reach more customers with a retail storefront and an e-commerce store
You can please customers who like to shop in-store and tap into a growing online customer pool
Customers can reach customer service through multiple channels — from email and chatbots to phone and in-person
Customers can purchase products in a variety of ways depending on their preferences

There are also challenges to overcome for your business. You need the resources and systems in place to manage both effectively. And you need to provide a consistent customer experience across both channels, from pricing and promotions to brand messaging and marketing.

Here is where a purpose-built POS system shines. Comcash provides a modern POS solution to small retail businesses — and we understand the need for omnichannel store management. Our solution provides various features like:

Cloud-based software
A smart customer display
Mobile inventory management
E-commerce integration
Integrated customer loyalty

And more! Check out how we can help your retail store thrive by scheduling a demo today.

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