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Retail Click-and-Mortar Strategies

PikeNet 2000 / Apr 5-7, 2000 / San Francisco

E-commerce Battle... The attempt of the Saint Louis Galleria to ban Internet advertising (Nov 29 Dispatch) triggered a bunch of interesting e-mail. I've copied excerpts from two below. The first is from Will Roberts at The Arctos Group, Chestnut Hill, MA, who tells a fascinating story about shopping at Circuit City's web site. In the second, Norm Miller at the University of Cincinnati exhorts mall owners to develop digital connections with their customers.

Will Roberts: "My son was working on a high school project involving the making of a video, and he informed me that our old VCR has just died. I really did not feel like going out shopping on a Saturday evening, but he needed to get his project finished. ... Well, Circuit City has a web site that not only let me see the products which the chain sells, but allowed me to select those brands and models of particular interest and see them lined up side by side with the features compared in tabular form. The web site then noted the location of the nearest Circuit City bricks-and-mortar store and verified that the store had the desired item in stock.

"Although I could have ordered the VCR online to be drop shipped from a Circuit City distribution warehouse by UPS or FedEx, I was given the choice of buying it and picking it up immediately at the nearby store. I made the purchase by credit card online. The item was instantly deducted from the local store's inventory and set aside for pick-up, just as if I had purchased it on the store's sales floor. ... In my case, I was able to get what I wanted online and then drive 15 minutes to the store to pick it up. ... At the store, I showed a photo ID and my credit card to prove that I was the authorized person to pick up the merchandise. The store knew the item had already been paid for, and hence I did not have to wait for a credit card authorization or any paperwork."

Norm Miller: "... Few malls have their act together. Most are doing what you might expect -- loyalty cards, discount cards, better web sites that link to their parent companies. But few are really into e-marketing based on the wealth of data that is only possible with personal collection. So my advice in a nutshell is to collect customer profile information and e-mail addresses NOW!

"The malls say they don't have time or staff to do e-mail based marketing. But they will need to do this in the future, and so they need to start collecting the data now. And not just the e-mail address, but age, gender, and anything else that they can put into a database. ... In my opinion, they cannot afford not to do this. ... I think that in 3 to 5 years the NOI of many regional centers with large percentage rents (5 to 10% of NOI) could actually decline even though total retail sales are climbing nicely."

--Peter