Physical retail shops are not required for all categories of products, according to Walid Mansour, Managing Partner and CIO at Middle East Venture Partners.
“Category after category technology in digital has been able to prove that you don’t need physical retail to get whatever you are shopping for – starting from books, electronics and even fashion”, he said.
The Chalhoub Group, for instance, which has more than 750 retail outlets across the Middle East with a portfolio of 300 brands that include Sephora, Louis Vuitton, Tod’s, Michael Kors, L’Occitane, Lacoste, Tory Burch – will close 10 per cent of its stores over the coming months to move a lot of its investments to e-commerce.
Even globally, Inditex, which owns eight brands including Zara and Pull&Bear, will close up to 1,200 stores. The Spanish retail giant has unveiled a digital platform and expects online sales to account for over 25 percent of total sales by 2022.
“If you are good in your digital channeling with the discounts, promotions, loyalty programmes, payment schemes, recommendation search engines etc. they are all way better online than offline. I don’t think retail will die but I don’t suspect that the shops will not be smarter and adopt the key premises of e-commerce”, he said.
Speaking of retail verticals he thinks are better off online than offline, Mansour said, “While shopping for electronics, 70-80% of the times customers do price comparisons online to see if there’s a better deal out there. And this applies to fashion too. Your entry point to your shopping experience, even if you are in a store, is through your cellphone”.
“In order to get coverage, you don’t need so many retail shops around the city, if your digital offerings are good. What retailers should probably look into are warehousing, stocking or on-demand supply chain capabilities. So investment models will have to change – where you invest less money in stores and put that money in somewhere else”, he added.
Atul Bhatia, the head of growth and strategy at Splash agrees that not all retail categories need physical spaces, but fashion isn’t one of them.
“I don’t think it’d be possible to not have any retail space for fashion. This is a question between discretionary and non-discretionary categories. If you want to buy milk, eggs etc. you can just buy them online. But fashion is an experiential category where you want to try and touch the fabric”, said Bhatia.
If you are a retailer, join the debate by sharing your thoughts with us on our social media channels
Words by Farimah Moeini, Snapchat Head of Industry – Retail and Travel TheJuly 5, 2021 | By RetailME Bureau
Snapchat has been betting big on Augmented Reality’s (AR) retail future consideringJune 22, 2021 | By Jibran Chouguley
Nando’s has revealed their revamped Sheikh Zayed Road outlet where newcomers and
UAE-based Al Maya Group announced that it will be boosting import of
UAE-based grocery retail chain, Grandiose has opened its first hypermarket in Abu
UAE-based Carrefour announced its theme and plans for Ramadan 2021. The brand
Locally owned supermarket Spinneys celebrates 60 years of doing business in the
UAE-based Carrefour will become the first retailer in the region to offer new levels
The Organic Farmers’ Market is back in Bay Avenue for its 12th
UAE-based Lulu Group recently inaugurated its first-ever all-female staff store in Jeddah,
Jones the Grocer, the gourmet grocer and cheese retailer launches the Jones
UAE-based Al Maya Supermarkets is hosting a two-week food festival at select
Locally-owned supermarket Spinneys has launched its ‘Power of Plants’ initiative in the
E-commerce giant Amazon’s founder Jeff Bezos has stepped down as CEO, handing
American clothing retailer, PVH has increased the number of active job advertisements
Extravagant, conceptual, great food and views are some of the ways that
As the UK begins to return to normality, Father’s Day shoppers are
Abu Dhabi’s state investment company ADQ is in talks to invest about $500 million
Netflix has announced the launch of its e-commerce platform where show merchandise
Global e-commerce giant Amazon has announced that it has struck a deal
French luxury conglomerate LVHM’s chairman, Bernard Arnault on Monday replaced Jeff Bezos
Amazon.com Inc. will supplant Walmart Inc. as the biggest U.S. retailer by 2025, according to
The once powerful department stores that anchored malls and streets around the
Who isn’t a sucker for discounts? Customers today are spoiled for choice
The various e-commerce and virtual retail stores that cater to different product