Online Retailers Starting to Appreciate Value of Brick and Mortar Stores

This article was written by Glen Korstrom and originally published in Business in Vancouver.

E-commerce ventures and traditional retailers are rapidly fusing sales strategies and creating a hybrid model that includes online and in-store purchases.

As street-front retailers reduce store size, opt for kiosk-style outlets within stores and increase marketing budgets for online sales, e-commerce ventures are opening more pop-up stores that last weeks or months instead of days.

Vancouver-based online suit-seller Indochino launched its first pop-up store in Vancouver in November 2011 and has since had seven other pop-up stores in cities such as San Francisco, New York and Chicago.

CEO Kyle Vucko told Business in Vancouver that his company has increased pop-up store opening times to several weeks for the one currently in Boston. Its first pop-up store lasted four days and offered customers the opportunity to book sessions for Indochino staff to take their measurements.

Vucko’s company continues to more than double its revenue each year and recently moved its 40 Vancouver staff to a larger office in Vancouver’s Railtown neighbourhood, east of the downtown eastside.

Vancouver’s other major e-commerce venture, Coastal Contacts, is also scouting around for potential pop-up stores.

It opened a new 1,000-square-foot store under its Clearly Contacts brand on Robson Street between Burrard and Thurlow streets on March 21.

CEO Roger Hardy refers to the store as a “pop-up”; its lease is rumoured to be six months.

Hardy would not disclose the length of the store’s lease, but he said it’s shorter than leases that most retailers sign and that he is simply testing out the location.

Coastal Contacts’ Lensway subsidiary operates six street-front locations in Sweden, and Hardy said the stores have helped boost e-commerce sales in that Scandinavian country.

“There’s evidence that hybrid models of retail are going to be the most successful.”


Indochino and Coastal Contacts’ moves come as another successful e-commerce retailer, U.S.-based Bonobos, is taking pop-up stores one step further by opening Bonobos Guideshops.

The showrooms allow customers to touch, feel and try on merchandise but not buy any sweaters or pants that they can leave the store with.

Hardy believes the future of retail will be primarily online and that the only way many street-front retailers will survive is if they shed square footage.

He pointed to large U.S. retailer JC Penny Co. Inc. carving its stores into mini boutique shops. In Vancouver, that’s happening at the Hudson’s Bay, where Canada’s oldest retailer partnered last year with U.K.-based Topshop to open a 33,000-square-foot Topshop/Topman store. Upscale Holt Renfrew similarly allowed Chanel to open a boutique within its Pacific Centre store.

The reduced square footage is important, given the trend of shoppers checking out merchandise in person and ordering online.

According to a recent IBM survey, nearly half of all online shoppers do this. About 34% of these consumers wind up buying from an online-only retailer, the study found.clearly