Panels & Furniture Asia Nov/Dec 2019

PANELS & FURNITURE ASIA • Issue 6 • November / December 2019 PANELS MANUFACTURING 29 OMNICHANNEL RETAIL ON THE RISE IN SINGAPORE’S FURNITURE INDUSTRY T he decline in retail sector may be hurting major developed markets as foot traffic in shopping malls fell with the onslaught of online shopping. But are brick-and-mortar stores doomed for good? Do they still have value? It certainly doesn’t seem so, as both online and offline retailers are exploring ways to merge the advantages of online and offline retailing, There are even a few names for it — omnichannel retail or online-to-offline retail; Alibaba calls it “new retailing”. Meanwhile, IKEA has long mastered it. SO, WHAT IS OMNICHANNEL RETAILING ? The most sophisticated retailers are now closely examining the interplay between offline and online customer decision journeys, recognising that consumers today shop across channels: they might visit stores to check out products before ordering them online or they might research a product online, go down to a store to see the product before buying it in-store, according to a Mckinsey report 1 . In our local furniture industry, this trend is emerging. Taobao, the largest consumer-to-consumer and business-to-consumer e-marketplace in China has opened Singapore’s first offline store with a focus on the Home and Living category while Commune, a home-grown furniture brand, introduced Singapore’s first cloud-based, omnichannel furniture retail solution to all its local stores. So, it looks like physical stores won’t be disappearing any time soon. Mckinsey estimated that in-store sales will still make up 75 to 85 per cent of retail sales by 2025. “The physical store is no longer just a place to buy products. A store now plays several possible roles: it might serve as an experiential showroom for products, a fulfilment centre for online orders…a hangout where groups of friends can try things on and take selfies that they then post on social media, or a destination for those seeking ideas and inspirations. It’s entirely possible for a store to have weak sales and profits within its four walls while being a strong contributor to the retailer’s overall performance,” the report says. “In an omnichannel world, a store can do more than just raise awareness; it can drive sales through other channels, and vice versa.” 1 Alana Podreciks, Nathan Uhlenbrock and Kelly Ungerman. Who’s shopping where? The power of geospatial analytics in omnichannel retail. [Online] https://www.mckinsey.com/industries/retail/our-insights/whos-shopping-where-the-power- of-geospatial-analytics-in-omnichannel-retail By Szeto Hiu Yan

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