E-commerce isn’t for everyone; there’s still room for brick and mortar, Michigan retailers say

Brahm Buck

The Boston Tea Room has been a staple in Metro Detroit for 40 years, but as a business that relies on 90% of its services being in-person, the last year has left it on unstable ground. The retail portion of the Tea Room includes loose leaf tea, crystals and candles, […]

The Boston Tea Room has been a staple in Metro Detroit for 40 years, but as a business that relies on 90% of its services being in-person, the last year has left it on unstable ground.

The retail portion of the Tea Room includes loose leaf tea, crystals and candles, but the majority of its business comes from astrological readings, tarot card readings and palm readings, owner Heatherleigh Navarre said.

Prior to the pandemic, they added readings by phone, but it didn’t take off until COVID-19 shut down any in-person options, Navarre said.

Both staff size and revenue have suffered, she said. Reading services made up 50% of revenue but shrunk to 30% during the pandemic. Her staff of readers declined from 20 to 12.

There was an attempt to move operations online, but technical difficulties ended up costing more in staff time and training than the service itself, Navarre said. In one instance, Navarre spent more than an hour instructing a customer on how to use Skype, she said.

The Ferndale store remained closed despite customers still knocking at the door for crystals or sage bundles, she said.

It was difficult to turn away paying customers, but Navarre ultimately chose to stay closed until June.

“There’s no such thing as the Rose Quartz emergency,” she said. “The demand was always there, so when we did reopen, even though we’re letting a lot fewer people in our store, the retail really bounced back.”

Attempting E-commerce ended up being costly and frustrating, Navarre said. The online sales yielded less than what she paid in staff hours. Ultimately, the business lost tens of thousands of dollars trying to pivot online, she said.

Even with the small number of sales, the store wasn’t set up for the quick delivery customers have become accustomed to with online shopping. Navarre would field impatient phone calls asking for tracking numbers on orders that were placed the night before. It was a pace their business wasn’t built for, she said.

“People’s expectation of E-commerce is built off of their experiences with very large online retailers,” she said. “They expect drone delivery within a 24 hour turnaround time.”

The store is back open and offering limited services. With the cushion of a payroll loan and a longstanding reputation, Navarre said she expects business to bounce back.

The online experiment was put on hold in March after an E-commerce manager left the company. Navarre said she hopes the pause allows her to catch up and hire someone with expertise in the field.

Even seasoned online retailers had to make adjustments to stay relevant in an increasingly online market.

For Detroit-based retailer Shinola, the luxury brand already had a firm foundation in E-commerce, CEO Shannon Washburn said, but the pandemic did change shopping trends, with jewelry sales increasing, demand for leather work bags dropping and the company’s bicycle line having its best year yet.

To optimize online shopping, the Shinola team expanded product delivery options such as shipping from store and curbside delivery. What the company found, though, was that its customers still wanted the in-store experience, said Brad Schneider, Shinola Head of Retail.

The challenge then became recreating the same hospitality experience after masks replaced smiles and hand sanitizer replaced handshakes, he said. With plexiglass dividers and timed visits, the stores did their best to replicate the pre-pandemic experience, he said.

Shinola stores went from booking a few shopping appointments a month to more than a thousand monthly visits, Schneider said.

To accommodate holiday shoppers, some Shinola locations were able to expand to allow more space for social distancing. In Metro Detroit, the business was able to take over vacant square footage in Somerset Mall and at its Detroit hotel location on Woodward Avenue.

For retailers nationwide, the 2020 November-December holiday season accounted for nearly one-fifth of overall annual sales, according to the National Retail Federation. Despite the pandemic, overall holiday sales grew 8% compared with the year before and online sales increased 22.6%.

While 2020 accelerated the E-commerce trend, the pandemic has proven that brands like Shinola must continue to make retail immersive and to find ways to meet customers where they are, Washburn said.

“While we may see huge growth opportunities in E-commerce, we still believe strongly in our own brick and mortar and our wholesale partners,” Washburn said.

More on MLive:

Tracking a year of coronavirus in Michigan

COVID-19 one year later: ‘This is our life now

Will the pandemic be the final nail in the coffin for Michigan’s malls?

West Michigan wedding, banquet centers call on state to ease COVID-19 restrictions

Expanded outdoor dining likely to continue through summer, fall in Grand Rapids

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