From Online to High Street?
According to the ONS, the percentage of online sales v overall retail sales hit a peak of 21.5% (to date) in November 2018. A decade earlier, in November 2008, the amount recorded was just 6%. The trend is very much in an upwards direction, but let’s note that the vast bulk of retail sales, (over three quarters), still take place on the High Street.
When things are broken down into binary positions, often the conclusion is drawn that one is better than the other, one has replaced the other, etc. Let’s consider a third alternative – that the “new” model actually aids the older one, even whilst taking market share. I say this, as retail sales have risen overall by 11.7% in the last three years alone.
I’m not saying estate agency is retail – recent events at Countrywide have confirmed that’s not the case. Might I suggest however, that where estate agency can perhaps learn a lesson from retail, is to view online not as the enemy, but a very powerful ally. I propose that rather than ask the question, “how can online support/enhance my current business proposition?” instead ask, “how can my High Street location(s) enhance the overall customer experience that we deliver online?”
A number of businesses that started online have now moved onto the High Street. Perhaps the best example of this is Amazon, who not only purchased Whole Foods for $13.7billion, but have also opened their own stores offering a near “shoplifter” experience: there are no tills, shoppers help themselves to items from the shelves and their account is automatically debited when they leave the store via ApplePay or similar that is “read” via an App without even needing to take card, cash or phone from your bag. Several of our members will get to experience this when we visit Seattle next month for our annual BlueSky event.
Why would Amazon do this? My guess is primarily two-fold. Firstly, they want to harvest the data from affluent customers of Whole Foods. Secondly, and this is where it gets relevant for you, they want to understand the customer buying experience better and to build on this both in-store and online.
At the EA Masters, the biggest event in UK estate agency that takes place this year on October 10th, we will examine the relationship between Online and High Street and how it might look in 3-5 years time. My sense is that more and more customers will wish to transact online, but will also want to have a relationship with an estate agent so long as real value is added (note, real value for them). In the same way that many car showrooms now don’t sell cars, (that happens online), and clothes retailers have iPads to allow purchases to be made in store once the shopper has tried the garments on and which are then delivered direct to the customer’s home, so I can see this developing for estate agency. The customer will come in to the branch to meet with their agent, mortgage broker, conveyancer and home moving concierge, (perhaps all these services delivered by one person), but will actually have the initial viewing, make the eventual offer & complete all the “paperwork” online.
The key, I think, is to reengineer the business, (which starts with our thinking), into “Online First” and then to consider how to integrate the value of the branch network, not the other way round.
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