The Web 2.0 buzzword it seems is now passé. Old news. We need something new. Some fresh piece of jargon to keep people on their toes; to keep us ahead of the pack. With high street brands slowly (very slowly) and finally looking to leverage online marketing and ecommerce channels, someone somewhere looking for a neat little blanket phrase for retail on the web, and unable to stop thinking in terms of the tangible and familiar, seems to have coined the term “Virtual High Street”. So here we have it - the next big topic for discussion.
This label is great for readers of business news everywhere, and of course for all those big retail brands that are keen to think of the web like some kind of well defined, tangible place, where shoppers will conveniently head to on a Saturday to do their browsing and shopping like they always used to. The “Virtual High Street” is a clever phrase because it inherently suggests a simple transference of existing market share and branding onto the web in line with current offline positioning, but in fact has no explicit definition.
The web has a vast number of companies marketing and selling their products, from tiny, niche players to vast websites selling everything imaginable. There are companies like Amazon that exist only in the virtual world, with brand recognition that would make an offline retailer sweat; others that combine online selling with offline catalogue marketing like dabs.com; little niche players that do something unique, or market some specific product in detail; and now finally traditional real world retailers that are dipping their toes in the virtual world. This last shift is suddenly making the offline business world sit up and start analysing and categorising the online retail space, and the most convenient way to do this is to imagine that there is some kind of virtual high street – a regularly walked path that users take while browsing the web.
The reality of course is that your average web user, who is just about getting comfortable with broadband and online security, and whose experience of the web has always been driven by search engines, would be very surprised to be told that the web isn’t in fact an open, limitless, product-oriented front; but simply another branded avenue designed for visiting the shops.
High street retailers generally have strong brand recognition due to their ubiquity, but little brand loyalty and/or social kudos attached to their branding. As users, we don’t use the high street because we particularly care which brands are available to us, but simply because it is convenient to have a bunch of retailers all within close walking distance to each other. I don’t really care whether my PC comes from PC World, or Currys, or Dixons, or John Lewis. If I’m happy with the prices on offer, and if any one of them is not on my particular high street, there’s no chance at all that I’ll explicitly find another high street with that particular brand. In other words, once off the physical high street and into the world of online ordering and postal delivery, most users couldn’t care less who sells them the product they want, as long as the price and service are acceptable, and the item on arrival does what it’s supposed to do.
Products are different too. The majority are about the experience, like luxury items, fashion, jewellery, sports goods and clothing; while others are about form and functionality only like electronics or toys; or more about differentiated content like financial products, holidays, books and music; or finally, homogenously consistent like daily food stuffs. In the offline retail world, the latter three categories form only a small part of the high street, but these are really the ones that successfully transfer online, because web browsing and delivery increases convenience without increasing risk of dissatisfaction. I wouldn’t browse for and buy clothes online – how do I know what they’re going to look like on me? I wouldn’t browse for and buy shoes online – how do I know if they’re going to fit or be comfortable? I wouldn't even browse for and buy a tennis racket online – how do I know if it will feel right in my hand? For products like this, I might like to see what’s available through online channels before heading out to visit the relevant shops, but only as a way of minimising the amount of time I spend shopping. Conversely I might identify the product offline and then look for a bargain online, but that wouldn't be limited to high street retailers and is thus another story unrelated to this post.
Of course people do use the internet to buy things, and a significant enough proportion use the web to buy luxury retail goods to make it cost-beneficial for brands to supplement their offline offering with a virtual store. But here’s the caveat. While the term is clearly here to stay, in reality I believe there is no virtual high street where web users conveniently congregate. It is actually faster for most people to simply head down to and walk around the shops, than to browse through the same number of stores online, because the online browsing experience is significantly more linear and time consuming than stepping into a store and glancing around for items of interest.
Unless you fall into the form and function categories, for the most part, users are going to explicitly visit your particular online offering primarily as a prelude to visiting your physical store. Your website therefore must be supplementary with product listing, in-store collection and return, information about location, store opening times, and return policies, but doesn’t need to be particularly clever. Chances are that the quality of your website will only mildly affect your online return on investment, and have little real impact on your offline market share. This is unless of course you really want to make money off the web, and are looking to compete as a true online retailer; in which case you’re better off using Tesco’s model of creating a separate and independent decision making subsidiary (Tesco.com) that will create and manage your web presence unlimited by the inertia of your existing business model.
Google and shopping bots like Kelkoo have already made the web convenient to search and bargains easy to find. This is the real virtual high street where users go to browse and look for the things they want to compare and buy. If you want to compete on here you can forget about the other real world high street retailers and start recognising that your real competition is shadowy and different and not limited to the brands you normally compete against. In terms of targeting users that are really looking to buy online, your competition is the pure plays – the companies that specialise in online channels; and you should look to benchmark against these rather than other high street brands with online presences. If you really want your web offerings to be successful, they have to become entities in their own right; un-reliant on virtual malls, and unlimited by offline branding, market labelling or real world ways of working.