7 Reasons Why Online Retailers Are Opening Physical Stores

According to McKinsey & Company , in 2021, 80% of US retail sales will still come from physical stores.

Pure Play online stores (retailers who sell only through their online store) are starting to make a name for themselves in traditional retail. Many of the biggest online brands have gone offline by opening showrooms and stores, from French fashion retailer Spartoo to socially conscious eyewear brand Warby Parker to menswear retailer Bonobos.

The real acceleration of this trend came when Amazon opened its first physical store. The Amazon bookstore in Seattle, USA may look like a simple store, but it’s actually a very important first step into an omnichannel for the world’s largest online retailer.

Online + offline = more profit

The transition to opening offline stores does not mean that online trading is dying. On the contrary, online and offline synergy will be the key to retail success in the near future. Experts agree that online stores that open outlets will be more successful than their purely online competitors. We have selected the 7 most important reasons for success.

If people can evaluate your product in person, they are more likely to buy it.

According to the State of Retail Report published by TimeTrade, 85% of consumers prefer to shop in physical stores because they like to see, touch and test products in person before buying them. Touching the product can also dispel doubts and convince the person that it is the right product.

Customers who pick up or exchange goods in a physical store are prone to additional purchases

Click & Collect (buy online and pick up in store) is very popular with both buyers and sellers. People like the convenience of choosing an item in an online store at any time and the ability to pick it up themselves. Retailers love it because it’s good for business: According to UPS Pulse of the Online Shopper , 45% of shoppers who use Click & Collect end up buying additional items when they pick up an order in store.

Return to store is also popular with customers and retailers. A UPS study shows that 3 out of 5 shoppers would rather return to a store than mail or courier back an item. At the same time, 70% of shoppers who return items in a physical store end up buying something else instead.

Personal customer service increases sales

It is difficult to offer a personalized user experience online; at least that’s what buyers agree with. The TimeTrade State of Retail Report shows that a third of shoppers prefer to get advice from real consultants, and 90% of shoppers are more likely to buy a product after receiving help from experienced in-store staff.

Despite the popularity of online shopping, human attention and communication are still important to businesses.

An offline store will help create a brand atmosphere

There are many competitors in retail, and the brand is difficult to distinguish, especially online. By switching to offline mode, online stores get this opportunity. Promising retailers are not opening physical stores just to sell. Their showrooms and concept stores are primarily places where customers can immerse themselves in the brand’s culture. In-store ambiance is a key differentiator for a brand, and if done right, it can be a great way to make a lasting impression and engage shoppers.

A physical store improves logistics – it saves time and money

Online retailers use physical stores as part of their supply chain to reduce inventory management costs and speed up shipping. Logistics costs are the Achilles’ heel of e-commerce retailers as they tend to drive down profits significantly. By using stores as warehouses and distribution centers, online retailers can improve their supply chains and deliver goods faster and more efficiently to more regions.

Possibility of free research of preferences and habits of your customers

While data collected from an online store can be useful in understanding shoppers, retailers have the ability to learn a lot about their customers simply by observing their purchases and product interactions. The amount of market research you get just by watching people is equivalent to 100 focus groups.

Real stores will help increase traffic to your online site

As L2 reports in their Death of Pureplay Retail report , when retailers open physical stores, traffic to their online stores skyrockets. As stores open, online traffic grows, and the number of people mentioning the brand and searching for it on the Internet increases. According to L2, this online buzz is accompanied by an increase in financial returns, making the physical store a good investment in terms of both popularity and profitability.

Single-channel retail is doomed to disappear, whether it’s pure e-commerce or pure offline. Retailers who keep an eye on their customers and aren’t afraid to innovate will thrive. Retailers stuck in their “good old ways” will slowly but surely disappear from the scene.