How brick and mortar enables online retail

Although online retail is growing, it still only accounts for 6% of all retail sales. And physical stores play a critical role in online purchases. According to an Omni-channel Shopping Preferences Study conducted by A.T. Kearney, as many as two-thirds of shoppers go to a physical store before or after making an online purchase. The survey looked at the behavior and preferences of 2,500 U.S. shoppers from teens to seniors.

“A strategy based on leveraging the appeal of the physical store supported by digital is the best formula for capturing the maximum number of sales, building sustainable customer loyalty, and creating opportunities to cross-sell,” said Michael Brown, A.T. Kearney partner and study co-author.

More isn’t necessarily better. Stores are closing. Brands are re-evaluating and assessing locations, formats, and engagement. Retail today is an experience. Many brands are opting for smaller, more curated formats, alternative formats, and leveraging partnerships.

It used to be that a store’s physical location determined the activity of customers. But now, what’s important is the location of the customers themselves relative to their offline options. The physical circumstances define your offline options and, therefore, the attractiveness of the online option.

Also important is how the location of the customer determines with whom they might share information and who might observe their behavior. This is why packaging and doing things to make the product public are really important. You don’t even need to have a conversation; you can have things happen organically through social exposure. 

Shoppers are saying something about themselves through the products they consume. That’s why in a place like Los Angeles, people are spending a much higher fraction of their income on automobiles. They’re in them more often, and it’s more of a social signal of status or wealth.

About the Author
Jill Nickels has over 20 years of experience building brands and bringing them to life in built environments. As a Senior Strategist with Gensler, she works with companies from all industries. Contact her at jill_nickels@gensler.com.

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