Bricks And Clicks Business Model

  • The bricks and clicks business model involve a merchant operating both an online store and a physical retail outlet.
  • The bricks and clicks model may describe a physical retail business that establishes an online presence or the reverse scenario. Many businesses in the latter category are direct-to-consumer (D2C brands).
  • To be successful, the bricks and clicks model relies on a few key qualities. These include flexible return policies, immersive product displays, augmented browsing, and consistency in inventory. It is also important to integrate the instant gratification of in-store shopping with the convenience of online shopping.

Understanding the bricks and clicks business model

The bricks and clicks business model involve a merchant operating both an online store and a physical retail outlet.

The bricks and clicks business model refers to a combination of a physical retail store (the “brick”) and an eCommerce presence (the “click”). The model allows businesses to take advantage of both sales channels, drive more sales, and increase brand reach.

Nowadays, many businesses can be classified under the bricks and clicks business model because of the importance of having an online presence. Established retailers such as Target and Walmart are two obvious examples of companies that started with retail stores and then expanded into eCommerce. 

However, the bricks and clicks model also works in reverse. Companies that started online and then opened real-world retail locations include Casper, Warby Parker, Bonobos, Allbirds, Glossier, Peloton, and even Tesla. Many of these companies, the keen observer will note, are direct-to-consumer (D2C) brands.

What makes the bricks and clicks business model successful?

Here are a few qualities that make the model successful:

  1. Buy online, pick up in-store – while no one can doubt the popularity of eCommerce, it will never be able to match traditional shopping in terms of instant gratification. But shopping in a store has its own problems such as having to search for an item or standing in a long queue. Brands that utilize the bricks and clicks model combine convenience with instant gratification and allow the customer to get the best of both worlds.
  2. Consistent inventory – one of the most common customer frustrations is arriving at a physical store to find that a product the website said was in stock is actually out of stock. To combat this, bricks and clicks retailers need to ensure there is consistency between their online and offline inventory systems.
  3. Flexible return policies – this means that items must be convenient to return irrespective of how they were purchased. The business must allow in-store purchases to be returned in the mail and online purchases to be returned in-store.
  4. Product displays – for many consumers, one of the only reasons to visit a bricks-and-mortar store is the experience of viewing a product in person. To encourage offline fanatics to interact with its brand online, the business can ensure that its product listings are immersive, interactive, and accurately represent what is being sold.
  5. Augmented browsing – for better or worse, the sheer diversity of products available online causes some shoppers to become disappointed when they walk into a physical store. Retailers who operate smaller stores with fewer products can expand their product range virtually using tablets, QR codes, and self-service stations that connect directly to their online store.

Related Business Model Types

Platform Business Model

platform-business-models
A platform business model generates value by enabling interactions between people, groups, and users by leveraging network effects. Platform business models usually comprise two sides: supply and demand. Kicking off the interactions between those two sides is one of the crucial elements for a platform business model success.

Marketplace Business Model

marketplace-business-models
A marketplace is a platform where buyers and sellers interact and transact. The platform acts as a marketplace that will generate revenues in fees from one or all the parties involved in the transaction. Usually, marketplaces can be classified in several ways, like those selling services vs. products or those connecting buyers and sellers at B2B, B2C, or C2C level. And those marketplaces connecting two core players, or more.

Network Effects

network-effects
A network effect is a phenomenon in which as more people or users join a platform, the more the value of the service offered by the platform improves for those joining afterward.

Asymmetric Business Models

asymmetric-business-models
In an asymmetric business model, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus have a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility.

Attention Merchant Business Model

attention-business-models-compared
In an asymmetric business model, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus having a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility. This is how attention merchants make monetize their business models.

Wholesale Business Model

wholesale-business-model
The wholesale model is a selling model where wholesalers sell their products in bulk to a retailer at a discounted price. The retailer then on-sells the products to consumers at a higher price. In the wholesale model, a wholesaler sells products in bulk to retail outlets for onward sale. Occasionally, the wholesaler sells direct to the consumer, with supermarket giant Costco the most obvious example.

Retail Business Model

retail-business-model
A retail business model follows a direct-to-consumer approach, also called B2C, where the company sells directly to final customers a processed/finished product. This implies a business model that is mostly local-based, it carries higher margins, but also higher costs and distribution risks.

B2B2C

b2b2c-business-model
A B2B2C is a particular kind of business model where a company, rather than accessing the consumer market directly, it does that via another business. Yet the final consumers will recognize the brand or the service provided by the B2B2C. The company offering the service might gain direct access to consumers over time.

Crowdsourcing Business Model

crowdsourcing
The term “crowdsourcing” was first coined by Wired Magazine editor Jeff Howe in a 2006 article titled Rise of Crowdsourcing. Though the practice has existed in some form or another for centuries, it rose to prominence when eCommerce, social media, and smartphone culture began to emerge. Crowdsourcing is the act of obtaining knowledge, goods, services, or opinions from a group of people. These people submit information via social media, smartphone apps, or dedicated crowdsourcing platforms.

Open-Core Business Model

open-core
While the term has been coined by Andrew Lampitt, open-core is an evolution of open-source. Where a core part of the software/platform is offered for free, while on top of it are built premium features or add-ons, which get monetized by the corporation who developed the software/platform. An example of the GitLab open core model, where the hosted service is free and open, while the software is closed.

Open Source vs. Freemium

open-source-business-model
Open source is licensed and usually developed and maintained by a community of independent developers. While the freemium is developed in-house. Thus the freemium give the company that developed it, full control over its distribution. In an open-source model, the for-profit company has to distribute its premium version per its open-source licensing model.

Freemium Business Model

freemium-business-model
The freemium – unless the whole organization is aligned around it – is a growth strategy rather than a business model. A free service is provided to a majority of users, while a small percentage of those users convert into paying customers through the sales funnel. Free users will help spread the brand through word of mouth.

Freeterprise Business Model

freeterprise-business-model
A freeterprise is a combination of free and enterprise where free professional accounts are driven into the funnel through the free product. As the opportunity is identified the company assigns the free account to a salesperson within the organization (inside sales or fields sales) to convert that into a B2B/enterprise account.

Franchising Business Model

franchained-business-model
In a franchained business model (a short-term chain, long-term franchise) model, the company deliberately launched its operations by keeping tight ownership on the main assets, while those are established, thus choosing a chain model. Once operations are running and established, the company divests its ownership and opts instead for a franchising model.

Main Free Guides:

Scroll to Top
FourWeekMBA