CEO of Tesco Acknowledges the New Retail Paradigm

The Marriage of
Ecommerce and Physical Retail
Photo © nullplus @ istockphoto.com

Since the late '90s, ecommerce has competed with physical retail. However, despite its efficiencies, ecommerce has not threatened the existence of physical stores. Clearly, doomsday predictions for physical retail were unfounded.

As Philip Clarke, CEO of retail giant Tesco, said in his first official speech on June 8, 2011, "shopping online and the experience of in-store sales are symbiotically linked."

A case in point is the emergence of "click and collect;" a system whereby shoppers make their purchase decisions online, and then collect the goods from the retailer's outlet. Customers enjoy the convenience of online purchase, while retaining control over physical delivery. This marriage of physical and electronic retail signals the onset of maturity in the ecommerce industry.

In its early years, ecommerce sought to efficiently replicate physical stores. Later, ecommerce attempted to differentiate itself by focusing on its strengths. In that era, ecommerce tried to elbow physical retail out of the marketplace.

In the new retail paradigm, physical stores are using the strength of the electronic platform, and vice versa. 2011 has been especially active, with a large number of retailers joining the click and collect bandwagon. Those who offered click and collect earlier, have expanded their product range to include fresh vegetables and meat.

Will the marriage of physical and electronic retail last? Industry watchers have divergent opinions.