The future of the physical store is online
Consumer behavior is changing faster than ever. Digital technology is used before, during and after the purchase. Demands to get help and make sustainable choices are increasing, and online shopping is a growing option in terms of price and convenience.
Time to consume: 3 min
17 September 2020
From the classic shop to meeting place and time for socializing
The role of the store is changing to meet rising expectations and is transformed more towards a place for inspiration, information, service, and social interaction. The consumer places higher demands on the availability of goods and expects choice and simplicity in their purchases.
To meet market demands, there is a need for developing more efficient service solutions to improve the in-store experience by offering, among other things, guidance throughout the whole shopping experience, and self-service options based on consumer benefit. Analysing and taking advantage of insights and knowledge on consumer behavior is becoming increasingly central.
Many chain stores choose to cut down on their total store area by establishing smaller, and sometimes even fewer, stores. However, a clear trend is that store chains tend to invest significantly more in interior design and interactive solutions in the stores that remain. This means that the level of investment compared to available retail space will be significantly higher than before. An ever-decreasing part of the budget is spent on premises, with investment instead going towards store equipment. The market is also showing signs of seeking new models for rental for premises and adapting it to the level of turnover to support the development of physical commerce in the future.
E-traders establish physical stores
Although e-commerce has expanded significantly in recent years, the majority of retail sales are expected to continue to take place in physical stores. A clear trend over the past year is that more online companies and e-retailers have realized the importance of having physical stores in order to optimize the distribution of goods to consumers, as well as to build their brand profile.
Online + Offline = True
Tolerance of run-down stores, inferior shopping experiences, and long queues continue to decrease. As a result, the level of store concepts has been increased, both in rebuilding and rebranding.
It is important to create a coherent and well-thought-out solution where the store’s design is linked to a unified digital store experience. Starting with a design of the experience and customer journey is becoming a more important and more central part of such projects and understanding consumer behavior.
Effective store solutions
The trend of increased convenience store establishments in the Grocery sector continues in Europe, as does the establishment of smaller city stores in various retail segments such as Home improvements. This means that the demand for efficient store solutions is increasing. For many stores, the greatest opportunity for efficiency is in its checkout area. A larger proportion of shop staff is to be found here. With, for example, self-checkout solutions, staff can be freed up to work with more sales-driven activities in the store instead.
Smaller store space also means a greater demand to be able to show a complete range without having everything in stock. To offers what the industry calls an Endless Aisle solution, where the entire range is displayed on digital screens. The customer can find detailed product information, as well as make purchases that can be delivered to their home or picked up in store; the result is increased convenience for the shopper, and a more efficient store.
What defines ‘Retail’ is expanding. Consumers are looking for better experiences everywhere and there are lots of new opportunities. By understanding the changing consumer behaviour at the physical store the experience can be designed that results in increased sales, increased service and reduced costs for the retailer.
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