The physical store rises after the pandemic
The retail sector is recovering by leaps and bounds after the ravages of the coronavirus, but it must continue to adapt to the new changes in consumer habits.
Far from disappearing, physical trade will go further. The trends affirm this, as do the main market studies on the retail sector in 2021. The pandemic did a lot of damage in the physical store, but it is recovering strongly. Furthermore, its resurgence coincides with a deep adaptation to changes in consumer habits.
The retail sector understands and works thinking that the union of online and offline commerce is inevitable and decisive, that both generate omnichannel and unique shopping experiences. Something that fully addresses the needs of today’s average consumer. It is the concept of ‘phigytal’, a combination of the physical and the digital.
Optimizing the customer experience, increasing brand loyalty, promoting digitization, providing individualized experiences to the consumer … All this and much more is what is on the table in retail. To address this, from CAAD we have analyzed the main trends and market studies recently launched, as well as the forecasts of what the store of the future will be like based on what we are already seeing in the present.
Escalating influx to shopping centers
That the physical store is growing is demonstrated by the fact that the volume of people who passed through shopping centers in October increased by 13% year-on-year, following the upward trend of all of 2021 compared to 2020. According to data from the Sensormatic ShopperTrak report, although the increase in traffic in Spanish shopping centers has slowed from June to September month after month, the accumulated index of ShopperTrak in Spain points to a boom of 14.2% so far in 2021.
64% of the consumers surveyed continue to choose to make their Christmas purchases in physical stores.
On the other hand, 64% of the consumers surveyed continue to choose to make their Christmas purchases in physical stores. Another of the elements that is most in demand is the Click & Collect service, which allows customers to make their purchases online and collect them in the physical store, increasing by 12% year-on-year.
It should be noted that, for 1 in 3 consumers, the importance of Covid-19 protocols in stores is a key concern, although almost half of potential store customers will not change their habits of going to the physical space for their Christmas and Black Friday shopping.
The metamorphosis of the physical store to face the ‘giants’
Another of the reports that are setting the pace in the retail sector is that of the Ayden payment platform. According to his recent X-ray of this industry, physical stores will continue to be (very) alive, but for this to be the case, it must lead a metamorphosis that passes through digitization and versatility.
The physical point is still the most used sales channel, but experts warn: it must be a facilitator of the purchase process no matter where it is made. It is something that Tiendeo also agrees on, which maintains that 6 out of 10 customers make their purchases in the physical store, although 93% of consumers search for their products online before making the purchase.
The main threat they face is the deployment of digital giants such as Amazon or Zalando, which will put the most traditional part of the sector in check. Not surprisingly, The Wall Street Journal confirmed that Amazon would be planning to open its own physical stores in the United States, in the style of a 3,000-square-meter shopping center.
The reality is that the consumer has learned to use the best of both worlds, the digital and the physical. And according to Ayden, that the physical store continues with a lot of life, and repeating itself as the most used sales channel (38%), will depend a lot on its adaptation to the new buying habits of consumers.
The physical point has to become “an essential complement for the purchase, either as a showcase before it, as a collection or return point”, the report collects.
According to the data in this report, furniture and electronics stores (53%) are the ones that have led the necessary digital conversion, while fashion and food stores remain at an impasse (about 25-28%).
The store of the future: a digitized experience center
According to the study “The future of the store. The store of the future ”, carried out by Pateco in collaboration with the General Directorate of Commerce, Crafts and Consumption and the Valencian Agency for Innovation (AVI), digitization will be crucial in the physical store of the future. This will not only have to know how to maintain the online and face-to-face channel, but it will also have to fully integrate the latest technology in the shopping space.
With the customer at the center of the strategy, the study highlights the need to bet on profitable technology and at scale for retail. In other words, physical stores will not disappear as long as they are digitized and offer a unique, adapted and personalized customer experience. We are talking about more specialized spaces that have been converted into experience centers and product collection centers, not just pure storage. And also Artificial Intelligence will be the main protagonist of stores in the coming years.
We must not forget those values that make physical commerce different and better, such as optimal customer service, professionalism and closeness.
This is something that has also been agreed in the 1st Retail and Mass Consumption Forum organized by elEconomista. At this event, there has also been a long talk about “new retail”, that is, digitization in the value chain, for which it is key to put the consumer at the center.
Omnichannel, sustainability and total help in the purchase, the keys to the physical store of the future
After the paradigm shift with the pandemic, consumer habits and interactions between the physical store and the online channel have changed forever. The future, regardless of who it may be, goes through the offline channel, but always with integration into ‘e-commerce’ and a total experience for the consumer.
Thus, the keys to the store of the future go through:
1. Integrate physical sales with online sales
Consumers will demand more multichannel options to carry out their purchases.
2. Omnichannel strategy
You have to find the ideal synergy, betting on a hybrid store, promoting the balance between direct-to-consumer e-commerce shipments and fast and instant service in stores.
3. Long live retail and the physical store
Due to the facilities offered by the physical store, the advantages are still enormous, such as personalized attention, immediacy, experience capacity, ease of return and the possibilities of seeing the product on site. However, it must be taken into account that one in five online purchases begins in a physical store and one in three purchases in a physical store begins in a digital channel.
4. Sustainability as an axis
The enhancement of the environment within the retail sector is an extremely important issue. Consumers take it into account when making their purchases.
The use of digital technologies guarantees a better image of the brand or the physical store, offering more services with high added value. Especially since a good part of our life has moved to smartphones. And the thing is that digital rules even in the physical store, as endorsed by a study carried out by Tiendeo and Nielsen to those responsible for purchasing the home.
In short, the digital consumer first wants to access, from anywhere, all available information on prices, products, availability, services, etc. There, the physical store must guarantee the shopping experience to remain influential. And later, when the consumer is at the point of sale, they want a complete experience, avoiding queues and being empowered to make the best decision.