Online ecommerce business VS traditional retail store – which is better?

Online ecommerce business VS traditional retail store – which is better?

6 September 2022

When we look back ten years, no one would have predicted that online shopping would become a massive industry as it has in the years to come.

If someone had told me that it would be possible to get nearly anything delivered to your doorstep with only a few clicks of the mouse, I would have laughed.

However, as time went on, the term “e-commerce” became more common, and the convenience of online buying increased. And now, in 2020, e-commerce has completely taken over the traditional retail industry.

A lot of offline businesses are either moving their business online or thinking about taking their business online to expand it. Why is it the case? What are the advantages of an online ecommerce business over a traditional retail store? Let’s see if we can find out.

What is the traditional retail store?

The term “traditional retail” refers to selling products through brick-and-mortar storefronts, temporary stands, or pop-up shops. The final link in the supply chain is the retail store, which conducts business directly with end customers.

They usually only sell a few items at a time from their physical store and give discounts and deals on their products regularly.

Individual retail stores tend to be most adversely affected by competition from nearby stores. Still, huge retail chains may be affected by competition from further afield, such as nationally or internationally.

What is an e-commerce business?

E-commerce businesses, often known as online retail stores, are stores that sell products online  and then ship those products directly to their customers’ homes.

E-commerce stores sometimes bypass intervening points in the supply chain and purchase directly from the manufacturers or suppliers of the goods they sell.

They frequently keep their wares hidden away in warehouses rather than putting them on a show as retail establishments do.

They utilize photographs and descriptions to assist customers in selecting things that they wish to purchase. Since many online retailers offer and sell their products in foreign markets, the e-commerce industry is subject to global competition.

What are the Key Differences between Traditional retail stores e and E-Commerce?

The percentage of the overall retail market that is accounted for by e-commerce increases annually. Online purchases made up 21.3% of all retail activity in 2020.

The increase from 15.8% in 2019 was the greatest annual growth seen up to this point. Customers continue to gravitate toward digital sales channels because of the increased availability of products and the convenience that comes with them.

The omnichannel strategy is becoming increasingly popular among retailers as it combines digital and physical distribution channels under a single umbrella to provide customers with a more unified shopping experience.

Even though traditional and online commerce is beginning to merge, there are still some significant differences between firms focusing only on e-commerce and traditional stores.

The following table details the distinctions between the channels and how businesses are utilizing e-commerce technologies to bring them together.

Product Discovery

There are several significant changes in how customers find products using traditional commerce and e-commerce.

Customers can see and interact with the products they purchase in traditional brick-and-mortar stores. Typically, information on the product can be found on the item’s package (box, tag, stickers).

The value of an item is typically communicated to customers by online retailers through photographs and written product descriptions. There are a few advantages to having an online catalog, even though consumers cannot view or physically interact with the things they purchase online.

To begin, there is no cap placed on the number of products that can be listed on your website. When you engage in traditional business, you are limited to selling what is physically possible in your store.

Customers have improved capabilities for looking for certain products because of the rise of e-commerce. They can use the search field to type in the name of a product or a keyword or sort and filter the results depending on certain criteria. The most successful companies in this industry have started incorporating this into their in-person purchasing experiences.


E-commerce helps businesses tailor the buying experience to each customer’s specific preferences. Online retailers can use the customer’s interests to generate personalized product recommendations for each person.

Creating highly tailored shopping experiences is not available in the same way at conventional retail locations.

Shoppers of varying demographics frequent the same physical retail establishment. There is no way for the vendor to design a one-of-a-kind product display for each customer.


Brick-and-mortar businesses may only operate inside a specific geographic region. Therefore their reach is restricted. Because of this, the total number of potential clients that the company can approach is reduced.

On the other hand, this decreases the number of competitors the company must contend with. There can be no more than a predetermined number of additional physical stores in the vicinity (though the business still may compete with online alternatives).

E-commerce companies are not restricted to serving only local clients because customers can shop from anywhere.

Instead, they can communicate with people in a variety of countries. This results in a significantly wider audience of potential customers, but it also significantly raises the bar for the level of competition.

E-commerce retailers must compete with every other online store in their particular market. Because there is no upper limit to the number of stores the internet may manage, there is room for great competition.

Benefits of Ecommerce over Traditional Retail Business (Online Vs. Offline)

We refer to “eCommerce” as the process of purchasing or selling goods or services through the internet. To put it another way, you could say that eCommerce is simply the practice of carrying out business dealings through the internet. The following is a list of some of the most important advantages of eCommerce:

There is no business Location restriction

Customers can come from all regions and zones where you are aiming your business if you are an online retailer. However, in the case of traditional retail, your client base would have been restricted to those who lived within a specific geographical area range.

The result is that this is helpful for the customers as well. They are not restricted to purchasing from the stores and shops in their immediate vicinity, which eliminates the risk of quality and variety sacrifices on their part.

They do not need to go outdoors because they shop in an online store. They can enter the store while lying in bed and look around for the items they are interested in purchasing. Therefore, as a result of this, a win-win circumstance is created for both the customers and the vendors.


Compared to operating a traditional retail location, the costs associated with opening an online store are far lower. Regarding the latter, there is an excessive amount of headache.

To begin, you have to make an informed decision on the site, picking somewhere that has a satisfactory number of people and would encourage repeat business from existing customers.

If you are renting some space, you will have to make a monthly rental payment, which is determined by the amount of space rented out and the market.

Rent increases in direct proportion to its level of popularity. In addition to the rent, other areas might contribute to the overall cost of running your business, such as the utilities and personnel. This is the primary factor that contributes to the pricey nature of the traditional retail industry.

E-commerce, on the other hand, necessitates a smaller amount of space and has fewer operational costs. This is one of the primary reasons firms choose to conduct their commerce online rather than establish a traditional storefront location.

To begin selling your products online, you need only select an eCommerce platform and configure your store by its specifications to avoid incurring additional charges.

Data Analysis

When you run an eCommerce business, you can easily monitor and save vital information on your clients, including how they shop and buy.

For instance, you can analyze the number of orders placed in your shop, the specific regions or countries from which the majority of your orders originate, and the number of people who visit your website.

In addition, the age group of customers who make the most purchases from your shop, the gender of customers who visit your website the most, and the types of products generating the most interest.

All of these different kinds of information are beneficial to your company’s expansion. This is probably impossible in the standard retail industry or would be extremely difficult.

Number of Orders

How many clients can be attracted to a traditional storefront like a brick-and-mortar establishment? From the tiniest boutique to the most expansive department store, perhaps 10 or 100 or 500, even 500 seems excessive.

This indicates that you will only be able to receive a certain number of orders at any given time, although in the case of eCommerce, the quantity is virtually limitless.

There is no limit to the number of orders that can be placed, even though one million people can access your website simultaneously.

It is simply a matter of ensuring that your brand is well known.

Customer’s reviews

E-commerce provides you with customer reviews or product reviews, which are important factors in brand credibility and customer satisfaction. This is one of the primary advantages that eCommerce has over traditional commerce, and it is one of the most significant advantages that eCommerce has over traditional commerce.

When customers go to a traditional store, they can only assume that the goods will live up to the standards they have set for them. They express genuine concerns over the product’s quality, which can be viewed from the consumer’s perspective.

In the context of online retail, prospective buyers can read customer reviews and gain insight into the product’s quality based on the feedback of existing buyers. This plays a significant part in determining whether or not the prospect will make a purchase.

In addition, customer comments can assist you, as the retailer, in identifying any shortcomings in your product, allowing you to improve it in the future.

Accessibility of the Brand via Search Engines

Your offline retail business’s reputation and level of popularity are the primary factors that will determine its success. And to get people to take notice of your brand and bring in new clients, you will need to invest a significant amount of money in marketing to bring your brand to the public’s attention.

In contrast, when it comes to eCommerce, it is possible to gain a substantial amount of “organic” traffic on your website through search engines. Most individuals in this day and age have access to the internet and a smartphone, so if they want to shop for something, they type their questions into a search engine and see what comes up.

If the search query is relevant to your company and your website is optimized for search engine optimization (SEO), then the likelihood of your website appearing in the search results is very high.

Easy to Simple to find products

An eCommerce website user needs to enter their search query into the search bar to find the product they are looking for.

People no longer have to drag their shopping carts around and put their belongings in them. They need only peruse the offerings, add things of interest to their shopping basket, and then proceed to pay for their purchases.

Retaining Current Clientele

Even though retaining customers in an eCommerce business is not a walk in the park due to the abundance of other businesses focusing on the same market niche.

Because your competitors constantly attempt to steal your customers, doing so is still much easier than doing so in a traditional retail business.

When a consumer purchases at a physical store, you have no way of knowing when he will return or if he will return. There is no way for you to communicate with your clients to persuade them to return to your store.

But if you have an eCommerce website or ecommerce store, you can run various deals, offers, and promotions and connect with customers in various ways, such as through email marketing or the social media connections you have. This makes it easier to attract clients and ensures they will buy from you again.


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