Are Retailers Changing Channels?
When Amazon launched Prime Day on July 15, it followed a growing trend of online shopping – one that has increased so rapidly in popularity that online transactions now warrant a designated holiday. And, though the public sentiment following the event was sour, Amazon’s sales figures were sweet; they were up 80 percent over last year’s figures by noon on the big day, according to ChannelAdvisor.
In fact, online shopping overall has been averaging year-over-year growth of nearly 25 percent. So, what does that mean for traditional brick-and-mortar stores? The latest reports show that online shopping is actually favorable for stores that maintain a physical presence.
In an annual survey of more than 19,000 consumers worldwide, PwC found that almost 40 percent of shoppers make purchases inside a physical store at least once per week, compared to just 27 percent who do the same online. Not only did the majority of consumers surveyed want to avoid delivery fees, but they also prefer the immediacy of shopping in-store versus online.
For more and more businesses, omnichannel retailing, or multi-channel retailing, is the best way to meet these needs and encourage sales. This strategy blends various channels of doing business, such as online and retail stores, or customized apps and catalogs.
It’s a strategy that research supports. The PwC data shows that nearly three quarters of those surveyed spend time browsing products online before buying them at a physical store. Retailer web sites serve as the showroom, allowing consumers to learn more about products and research pricing for later, in-store purchases. And, while consumers get the information they need, stores can track consumer demographics and browsing patterns to gain insights for product development and sales applications.
In turn, brick-and-mortar stores will need to adapt to the digital age to keep shoppers coming back. As the public seeks retail experiences over simple transactions, commercial real estate landlords and developers have to collaborate with store owners to make the location enjoyable, convenient and memorable.
An omnichannel approach means retailers can enjoy a more robust business by employing online and physical locations, and commercial real estate developers enjoy more relevant tenants. To learn more about this trend, along with how it can impact your commercial real estate needs, contact Intelica today.