Unrelated to recent discussion topics, but perhaps of general interest to the class: Recently, Koreans have embraced a “virtual shopping experience,” where the consumer can select digital items and have their real counterparts delivered to his/her home. For example, shopping chain Tesco uses QR technology to allow people to scan codes with their smartphones and receive the scanned items through delivery. This invention has enabled the  store to gain market share without opening more physical locations.

I am interested to see how this technology will spread.

Virtual subway store, using smartphones:  http://www.youtube.com/watch?v=fGaVFRzTTP4 and http://www.adverblog.com/2011/06/23/tescos-subway-virtual-store/subway_virtual_store/

Virtual store, shop by touching the screen to purchase items: http://imgur.com/2Gb3y

Original Post Date April 2, 2012

I’m glad we have a chance to discuss e-commerce and online retail; I worked as a merchant intern for Bloomingdale’s this summer and will be returning in the fall as an asst. buyer so this topic really interests me. Speaking only from a Bloomingdale’s perspective, although I suspect this is not a unique case, e-commerce is growing at a much faster pace than our brick and mortar business.

However, I would highly doubt that brick and mortar stores will ever be fully replaced by digital storefronts. While online retailers have some advantages such as convenience and enable easier comparative shopping, brick and mortar stores are crucial brand ambassadors. In other words, the physical experience of being in a store is an essential driver of business to the digital storefront.

In addition, while I find the Tesco Homeplus experiment to be really cool, I really question its generalizability. First, I think that it is difficult to get consumers to buy things online that they’ve never bought in person. For this reason, the Tesco experiment makes sense because groceries are such a ubiquitous part of our lives and we know with a high degree of certainty our preferences of certain brands or products. Since most categories of goods are purchased much less frequently, they are less easily saleable in digital or online formats. Second, different countries have different cultural comfort levels with the use of technology. While I can see how this might work in South Korea or even Japan, I question the success of its implementation in the US, at least right now.