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Chapter 3. Digitizing the Business: e-Bu... > The Click-and-Brick Pattern

The Click-and-Brick Pattern

Brick and mortar + Click and order = Click and Brick (C&B). So-called brick-and-mortar (BAM) companies are looking increasingly like new-economy firms as they harness technology to achieve greater productivity. A growing number of BAM companies, such as Merrill Lynch, Circuit City, Toys "R" Us, Wal-Mart, and Barnes & Noble, are attempting to transform their operations to support a digital business model. At the same time, several Internet-based companies are also looking to build a real-world physical channel, in addition to their virtual one. The hottest trends in e-tail probably won't be pure-play companies selling strictly through the Net. The most likely trend is toward the click-and-brick pattern, a hybrid online/offline business model incorporating both physical and online business practices.

The C&B pattern allows an existing offline business to profit from partnering with an emerging online presence (Figure 3.6). A great example of C&B is discount stock brokerage Charles Schwab, whose success has proved that storefronts can drive traffic to the Web sites. The firm continues to open new storefront offices every year, because that's where customers feel most comfortable signing up for their accounts. But once the relationship is established, the majority of customers use Schwab's Web site to monitor and to manage their accounts, where the customer costs less to serve. This lesson has not been lost on other retailers, which are finally starting to see benefits of combining e-commerce with old-fashioned department store service. An established retailer's name has tangible advantages in cyberspace, a world in which consumers are swamped with too many choices.


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