E-tailers ramp up offline presence to take on brick-and-mortar stores

Many e-tailers are gaining significantly by setting up brick-and-mortar stores and giving the offline ones a run for their money. These stores are seeing significant contributions to revenue and bottomline from their physical store. Stores like FirstCry, Lenskart and Pepperfry are some of these which have gained from their offline avatars. FirstCry was among the earliest online retailers to open offline stores in 2012. On the other hand, traditional offline stores are too busy getting into the digital marketplace. India’s largest business groups including Reliance Industries and Aditya Birla have launched online apparel stores in the last one year while Tata Group’s jewellery and watches brand Titan Company is acquiring online jeweller Caratlane.

FirstCry and Lenskart have opened hundreds of stores through franchisees, boosting their sales. The physical stores of companies like Caratlane and online lingerie brand Zivame are more like small showrooms. Pepperfry plans to double its store count to 16 this year. Ambareesh Murty, CEO, Pepperfry believes that offline stores are the best marketing channels that they have started, and also customers walking into physical stores tend to purchase more often than online buyers and at a higher average price. Pepperfry opens stores based on customer purchase data of the previous 24 months which helps it zero in on pin codes with high customer density.

The logic behind opening physical stores is that it helps the retailers to reach out to millions who are still uncomfortable using the internet. It is to meet the demand of such customers that sites like FirstCry will be setting up 700 stores in next three-four years from the present 170. Interestingly, FirstCry’s offline network is bigger than its nearest competitor Mahindra Retail’s Babyoye. There are 115 Babyoye stores and more will be opened through the franchisee route like FirstCry.