Philippine retailers face e-challenges

national retail conference

The challenges faced by Philippine retailers from competition brought about by the rising popularity of e-commerce and the entry of new brands into the market were discussed at a recent briefing by National Retail Conference Chair Paul Santos.

 Retail is moving from traditional, brick and mortar locations to cyber space, a development which should keep traditional retailers on their toes.

Santos said the entry of more foreign and local brands, all trying to get a share of the pie, has resulted in the Filipino consumers being “inundated with a lot of choices.

He added that E-commerce, where goods and services can readily be bought and paid for online, may soon be making a dent into traditional retailing. 

While retailers have learned to embrace social media like Facebook, Tweeter, and Instagram, they do so mostly for promotional and customer-relation purposes, with very limited selling and actual transactions taking place online.

 “Retailers are doing all they can to participate in … social media but they still prefer to do the actual sale, to establish a two-way link with the customer,” said Santos.

This is particularly true for items that customers need to fit like clothing and apparel.

The threat posed by e-commerce may still be marginal – estimated to be about 2 per cent of total retail sales because of credit-card requirements, but traditional retailers cannot be complacent.  E-commerce, for example, has made significant inroads in selling airfare tickets and hotel accommodations, adversely affecting travel agents. 

Santos sites a phenomenon known as “showrooming,” in which online sellers post photos of products sold in traditional retail stores in the Internet and sell these at lower prices in the internet. 

There are a whole range of electronic goods like phones, cameras and other gadgets that can be bought online at much lower cost than in brick-and-mortar shops.

The 22nd National Retail Conference will be held on August 7-9 at the SMX Convention Center.