Andy Dunn was fierce about the Internet-only model of his apparel company, Bonobos, after helping to found it in 2007. He gave a speech, "The end of apparel as we know it," arguing that stores were a bad economic decision. As he told a news channel in 2009: "We keep men out of retail stores when we know that men fundamentally don't enjoy shopping."
How times have changed.
Recently, Dunn was looking with satisfaction around a Bonobos store in Manhattan, one of six the company opened this year. "I was pretty puritanical about e-commerce only," he said, but found that about half of would-be customers would not order apparel online because they wanted to feel the merchandise. E-commerce is growing fast, he added, but "that doesn't mean the offline world is going away - it just means it's changing."
After years of criticising physical stores as relics, even e-commerce zealots are acknowledging there is something to a bricks-and-mortar location. EBay and Etsy are testing temporary stores, while Piperlime, the Gap Inc unit that was online-only for six years, opened a SoHo store this fall.
Companies say they are catering to customers who want to see what they are buying in person, and who see shopping as a social event.
{{/usCountry}}Companies say they are catering to customers who want to see what they are buying in person, and who see shopping as a social event.
{{/usCountry}}"Well over 90% of sales still happen in physical stores, so there is a huge, compelling reason to think about the physical store as a driver of sales," said Sucharita Mulpuru, an analyst at Forrester Research.
Dunn said the store idea stemmed from customers' requests to try on items before a purchase. Also, Bonobos said, "the cost of marketing a Web site and the cost of free shipping both ways was approximating a store expense."
Dunn said the average in-store transaction was $360, double what it is online, and first-time store visitors buy again in 58 days, versus waiting 85 days between Website purchases.