Physical Retail Isn’t Over, it’s Just Getting Started
The COVID-19 pandemic forced retailers to transform at never-before-seen speeds in the industry, encompassing an acceleration to digital as stores were forced to shutter their doors. At the height of the global lockdowns, the pandemic widened the gap between physical retail and online commerce. In the U.S. alone, approximately 20,000-25,000 stores were expected to close in 2020.
Despite the convenience of online shopping, there's something to be said about the experience of shopping in a physical store — the interactions between store associates and customer, the ability to handle products in person, and the personalized and unique experience for shoppers. However, for many brands, convincing shoppers to come back in-store is the biggest push. For many consumers, the shift to online has become the norm as COVID-19 forced them to adopt new habits. Incentivizing people to come back to physical shops takes more than promotions — it needs to focus on recreating the shopping experience they missed, while incorporating the ease of browsing online.
As we continue to show signs of recovery, now is the time to take advantage of the lessons we learned through 2020, implement new technologies that bridge the gap between in-store and digital shopping experiences, and introduce consumers to "Physical Retail 2.0" — one that embraces the acceleration to digital while reinventing the brick-and-mortar experience.
E-Commerce is Booming, But Don’t Discount Brick-and-Mortar
In 2020, the U.S. experienced the highest annual rate of e-commerce growth in the last two decades. However, brick-and-mortar stores offer a human component that consumers don’t get when shopping online.
After a year of lockdowns and social distancing, physical locations can quell the sense of loneliness that many people experienced. Shoppers visit physical locations for a sense of community and for a personalized experience. Working directly with shop associates to determine the right products is often challenging to replicate online, due to the screen barriers. But for many shoppers, they want to feel their purchases matter — which can be done through in-person engagement and conversation. Having a physical presence helps drive brand loyalty, engagement and return on investment for retailers.
Think Outside the Box: Bring New Elements to Stores
The shopping experience has changed irreversibly. Today’s stores need to catch up to consumer preferences and expectations.
Remember, physical retail doesn’t need to compete with e-commerce. It does need to offer consumers the same connected, seamless experience as online shopping, combined with the benefits inherent to in-store shopping. This includes the ability to see merchandise in person, touch the material, try on multiple sizes, etc. Combine this with digital accommodations like technology that enables sales associates to deliver a personalized touch informed by shopper preferences, or in-store pickup through branded apps.
Consumers enjoy online shopping because of the ease and accessibility. Items saved to their cart will still be there, and recommendations for new products are available. Stores need to adapt these features in-store by understanding their customers' needs and intents, and personalizing the experience accordingly. These adjustments also enable retailers to test fresh concepts designed to bring in new customers, while still catering to loyal shoppers.
Don’t Forget About Health Precautions
The health and safety of shoppers and employees must remain a top priority, as the pandemic has taught us all the importance of cleanliness and hygiene.
Wondering how to do so? Altering layouts to ensure safe distancing at all times has provided opportunities to identify new ways to improve the shopping experience, while not detracting from the overall flow of the store. Get rid of crowded racks or shelves, allowing products to be prominently displayed for easier viewing. Cashless/contactless payments can help speed up the checkout process and allows for consumers to feel a sense of comfort by using their personal devices. And limiting the number of consumers in a store allows for a more intimate experience between shopper and associate.
There's a sense of community that comes from having a physical presence — the key now is identifying how to re-create that feeling in today’s environment. Whether that’s through branded mobile apps, online shopping communities or virtual events, connections are key.
Despite the COVID-19 pandemic’s impact on physical retail, now is the time for retailers to double-down on retail and expand the investment in brick-and-mortar locations. Shoppers miss the in-store experience and are eager to return.
Ron Harries is senior vice president, head of retail at Fabletics, a global, active lifestyle brand that sells both men's and women's sportswear, footwear, and accessories.