Hybrid retail on the rise

BELLA KATZ
Last updated 05:00 11/03/2014
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Even Wal-Mart is moving to hybrid models.

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OPINION: Last week, the hugely successful online retailer and manufacturer of contact lenses and glasses, ClearlyContacts, was acquired for $462 million by a French lens manufacturer. (Essilor, the largest lens manufacturer in the world.)

It's a totally predictable next step in the life of this clever Canadian brand, launched by CEO Roger Hardy in 2000.

What is less predictable, is Hardy moving ClearlyContacts into physical retail, including upcoming store openings in New Zealand and Australia. Its flagship Auckland store is set to open in Queen Street shortly.

In Australia, the emergence of big international chains such as homeware brand West Elm are highlighting just how far evolved their models are compared with slow local retailers.

While Myer and David Jones contemplate a possible merger to save both their skins, the sharper internationals lead the charge by offering customers consistently good experiences across all their contact points.

In the competitive Australian eyewear industry, ClearlyContacts already has 4.2 per cent share of a total $76 million market.

It's still a drop in the ocean compared with the $3.2 billion the optometry and optical dispensing industry generates, but with the depth of customer data at their disposal, ClearlyContacts has its eye on a much bigger prize.

After all, disposable contact lenses Focus Dailies bought online are no different to Focus Dailies from your optometrist, expect perhaps three times cheaper. Right now lenses account for 73 per cent of all sales on ClearlyContacts.

Glasses have presented a bigger challenge as customers overcome the try-on factor, however, and hence successful online retailers adopt a "no questions asked" returns policy to mitigate some of the perceived customer risk. Companies including US clothing retailer Anthropologie and online shoe store Zappos offer free delivery and full returns. ClearlyContacts now offers a "try for a month before you buy" on its frames.

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For regular online buyers like me, including purchasing both glasses and lenses from ClearlyContacts over many years, there is simply no risk.

For those segments where buying online is still a hump, companies like ClearlyContacts are bringing the store to it customers and hoping it generates business back to online.

In Sweden, where the company has been trialing physical stores for several years, that has indeed proven to be the case.

The flagship stores have been a form of advertising and "live" catalogues, with extensive online sales data informing the instore product and merchandising.

As well as showcasing the top products, ClearlyContacts plans to use interactive digital displays in its physical outlets to connect buyers with all stock available that isn't in the store.

Meanwhile, Hardy insists the prices will remain consistent across both platforms, which he says can be as much as 20 per cent less on lenses and 50 to 70 per cent on glasses.

The hybrid model has even been embraced by traditional stalwarts such as Walmart, where merchandise ordered online is shipped for same-day pick up to local stores.

ClearlyContacts, whose own model offers 24-hour delivery, now operates distribution centres close to its markets, including one in Australia.

With the opening of the first New Zealand store, it'll be an interesting time for both on and offline retailers as they connect the traditional with, arguably, the "new traditional". 

Bella Katz is an Australia-based brand and marketing consultant and advises New Zealand companies exporting to Australia. She is also a New Zealand expat, calling Australia home for over a decade.

- Unlimited

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