State of Local

The New York Times Tech blog “Bits“ ran a great piece last week detailing how the local web is being used to drive real-world purchases, perhaps indicating that the long portended death of brick and mortar outlets has been greatly exaggerated. According to Bits, “E-commerce purchases are expected to grow a healthy but unspectacular 17 to 20 percent this holiday season over last year’s. But the Web’s influence over what people buy could be growing even faster.

Major retailers like Target, Home Depot and others have enlisted the help of Chicago-based ShopLocal.com, to enable local viewers to use their sites to complete offline purchases they’d previously researched online. According to ShopLocal’s in-house data, they’re seeing a 50% increase in online-influenced purchases when compared to 2006. According to a Forrester Research report issued last spring this type of purchase activity is expected to amount to 16% of total sales this year and be as high as 50 percent of all sales by 2011.

This kind of pre-purchase activity makes great sense for the consumer. There’s enough worry about the security of online transactions that many times even a slightly lower price or free shipping can’t overcome. In addition, by completing the transaction in person, the consumer can see and inspect the product up close. But, this type of activity can also make sense for the retailer, because the same thing can be done in reverse.

A consumer can just as easily enter a retail outlet to search and satisfy the tactile senses before going back to the computer to complete the purchase. In that scenario, the retailer has a motivated, captive audience than can possibly be sold items beyond those of which they are searching. Perhaps the retailers could also focus on the delivery, installation and service niche as an additional means to woo customers.