While brick-and-mortar retailers may not be able to get the kind of funding or be able to match the growth of their online counterparts, they are gearing up to compete with them by leveraging their brands, built over many years.

For instance, Shoppers Stop and the Future Group’s Big Bazaar are challenging online players with omni channel strategies, combining various shopping avenues — internet, brick-and-mortar, TV, etc — to reach out to customers.

“We will play in the online space on the strength of our physical brands and hope to make money in the next three years through the omni channel,” said Govind Shrikhande, MD and CEO, Shoppers Stop.

“However, unlike e-commerce players, we are here to make money and will not be giving discounts but sell at full price,’’ he said.

Global example

“In Europe and the US it is the brick-and-mortar stores of Walmart and Macy’s that are making a strong comeback in e-commerce with sales of $10 billion and $3.1 billion, respectively,’’ Shrikhande added, citing a global study.

Indian retailers, too, believe it is only a matter of time before they start posting better returns through e-commerce and compete head-on with pure-play online retailers.

Click-and-collect model

Targeting sales of 8-10 per cent from omni channels in the next 36-48 months, India’s retail pioneer expects the click-and-collect model to work.

“Globally, it is about click and deliver or click and reserve. In an omni channel we work on the customer and stock whereby customers click on the site and collect the goods from our stores,’’ he said.

At the same time, offline players are willing to undertake losses in the initial stages just like the e-commerce companies.

Eye on the future

“E-commerce players are selling our products and while both of us are struggling with negative returns, in the long run, we will be competing with each other,’’ said Kishore Biyani, Managing Director, Future Retail, which has formats such as Big Bazaar and eZone.

“Today, the more business we do through e-commerce, (the more it) will result in losses,” he added.

Future Retail already has two e-commerce subsidiaries — Future Bazaar and Future e-commerce — and both are incurring losses.

However, in future it plans to emerge as an omni channel retailer backed by technology and a customer interface.

Big Bazaar Direct, a franchise-led platform to reach out to consumers through customised tablets to book orders, is a step in that direction.