E-commerce hasn’t killed physical retail. It’s made it more important than ever
E-commerce boomed during the pandemic. That, coupled with widespread store closures, led many retail pundits to predict the final death of physical stores. In some ways, they were right.
Approximately 50,000 (5.7%) stores in the U.S. are forecast to close by 2026, while online sales are expected to grow by 50%. This is prompting brands to close more stores as they question the value that brick-and-mortar retail has in a post-pandemic world.
But the reality is that the rapid digitization of commerce is completely transforming—rather than eclipsing—the role of the physical store, and we need new ways of measuring its impact. The true value of the retail environment today is no longer solely tied to direct financial profit, which is increasingly the domain of e-commerce. It’s in the less tangible, yet critical, value of emotional and experiential engagement that only physical retail can offer. These softer elements are fundamental to establishing long-term consumer loyalty, brand reputation, differentiation, and, ultimately, sales.
It’s no surprise that brands are missing a trick here. In 2020, Covid-19 triggered a massive acceleration of e-commerce. Amazon posted its biggest-ever profit, Walmart announced a 97% leap in online sales, and some physical stores saw earnings drop by as much as 256%. Brands worldwide urgently shifted their efforts toward capturing consumer engagement in the digital world. However, in the rush to evolve their e-commerce, many brands forgot to also evolve the way they measure the impact of their remaining physical stores.
Read More at https://www.fastcompany.com/90765881/e-commerce-hasnt-killed-physical-retail-its-made-it-more-important-than-ever