Digital retail has made it easy for consumers to easily maneuver but they spend significantly more in-store visits than online. Online retailers only account for 5% of total U.S. retail sales. That means that 90% of retail sales are still occurring where it has taken place for hundreds of years: in-store. With an additional 5% of retail sales categorized as multi-channel. That means that 95% of all retail sales are captured by retailers who have physical stores.
In Q3 of 2020, 85.7% of retail sales took place inside stores in the United States, 94% of grocery sales took place in Ireland during the whole year. In times of a pandemic people still preferred to shop in person. Why do customers appreciate the physical shopping experience so much and why is a brick-and-mortar store essential for retail success?
Customer Experience (CX) - Consumers like to have the opportunity to experience the product. The online review says “good quality”, but customers usually like to make that decision themselves. 46% of consumers prefer shopping at physical stores because they want to physically experience the experience. It is and will continue to be an essential part of retail for customers. In-store shopping cultivates direct and meaningful relationships that are non-viable through digital. In fact, there is no better way a retailer can communicate and express their genuine identity to their customers than in a physical store. We've all witnessed how shopping enables social stimulus and opportunities that only a physical presence can attain.
Uplift opportunities - When customers shop inside the store, they are more likely to add more stuff in their basket. 89% of women and 78% of men who visit physical stores said that they made unplanned purchases and added more items to their cart. When you can physically see your customer and understand their shopping habits and behaviour, you then have an opportunity to encourage and influence a buy decision and a re-visit. A physical store gives you endless possibilities to attract customers to the door and increase sales. In the real physical world, customers are effortlessly reached and influenced as opposed to e-commerce.
Clicks to bricks - Online retailers are opening up physical stores as a way to captivate more customers and unlock new revenue streams. This is a new trend called clicks to bricks. Retailers have figured out that brick-and-mortars are an easy way to gain returns. As everyone heard, the online giant; Google is opening up its first physical retail store this summer to display and sell a variety of its products. And adding to that, with Amazon’s over 600 retail store locations, it looks like brick-and-mortars are not going anywhere after all.
There is just a little bit of a drawback here - Since the pandemic, consumers’ shopping needs have changed. The customer now wants a flexible experience or else they would rather shop online and avoid the hassle. Even if people want to feel and touch the experience, they still demand a good one or else they would perceive it as a stressful encounter. 68.9% of shoppers said that a good in-store experience is very important to them. This is a challenge for retailers but it is also an opportunity for growth and civilization.
Data-rich stores - A solution? Digital signage is an easy-way-out of retail extinction. Retailers who have adopted data-driven digital signage, leverage big data and smart algorithms to reveal the customer’s wants and needs. They are able to predict shopping behavior and habits and as a result recommend and promote products. You are in control of ensuring your customer gets the best possible CX. Once you provide that, and you will, you then have an opportunity to gain loyal customers. Isn’t that what every retailer needs? A backbone to their retail store to survive and have purpose? Adopting the technology in-store offers customers a unique and immersive experience that embodies the store's identity and goals. Unlike a social media ad or a billboard that will provide short-term visibility and effectiveness, the in-store digital signage has the advantage of being interactive and organically stimulating to the eye and mind of the customer. You let your ads fit the current customer criteria and their ever-changing needs. Needless to say, an easy additional revenue generator. In fact, in-store technology utilization in this Internet of Things era is guaranteeing the success of brick-and-mortars.
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