Last updated: Want to succeed in e-commerce? Open a store

Want to succeed in e-commerce? Open a store


The most successful e-commerce brands won’t limit themselves to the Internet, says Macy’s CEO Terry Lundgrend.

Macy’s is the perfect example of a thriving omnichannel business, and Upstart reports that a key plank of that brand’s success is the fact that it still relies heavily on sales from brick-and-mortar locations.

During an investor meeting, Lundrgend said:

The way the customer is shopping today is very blurred between store experience and online experience,” Lundgren said. “We wouldn’t have the multibillion dot-com business if we didn’t have Macy’s stores. I think we’d do a fraction of the business online if we didn’t have the store experience. I passionately believe more pure-play online businesses will be opening stores.”

Several successful online-only brands recently opened physical locations, including e-commerce darling Warby Parker and Gap’s Piperlime. The future of the retail store may look different, though, than the traditional shop to which retailers and customers are accustomed.

Macy’s, for example, is looking toward a future of smaller stores that function as showrooms, giving consumers a blend of the best of brick-and-mortar shopping (browsing, the ability to handle goods) and e-commerce: Virtual and physical items on display and the ability to search both online and in-store inventory.

But Macy’s hasn’t given up on the traditional store: It is also testing a full-service shop in an outlet-mall setting in Illinois.

The message Lundgrend delivers comes in loud and clear: Brands must be willing to experiment and take a holistic view of how their customers behave and adapt as such. That includes any business that begins as a virtual retailer only.

Those looking for a leader should take heed. Macy’s continued success is a perfect case-study for legacy brands and newcomers alike.

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