In today’s digital era, the retail industry is experiencing a notable change with e-commerce and digital marketing being the primary focus. However, it is intriguing to note that many brands are reconsidering their strategies and giving more emphasis to their physical stores. This shift in focus is not just a mere nostalgic gesture, but instead, it is a strategic response to the tangible advantages that physical stores provide, which are often overlooked in the digital realm.
The Changing Significance of Websites
In today’s world, almost every brand boasts a website. The democratization of e-commerce platforms has undoubtedly fostered innovation and competition. However, it has also led to a saturated online space.
In today’s world, the retail industry has become highly competitive, making it difficult for brands to stand out. Surprisingly, even the younger generation still prefers to shop in physical stores. A significant report from earlier this year showed that 97% of respondents prefer in-store shopping, with more than 35% citing in-person experience and the ability to touch, feel, and try products as important factors.
Brands have realized that having a website alone is not enough to offer a unique and engaging experience to their customers anymore. Therefore, they are shifting their focus to physical stores to create a distinctive environment where customers can interact with products in ways that are impossible to replicate online.
Stores Serve as Transactional and Marketing Channels
Although online platforms are great at facilitating transactions, they often struggle to provide an equally immersive marketing experience like physical stores. In-store experiences can be intentionally designed to engage customers on multiple sensory levels, leaving a long-lasting impression that goes beyond the initial visit.
Physical stores serve both transactional and marketing purposes, significantly boosting overall business revenue.
The rising prices of digital marketing emphasize the importance of in-store marketing. In the previous year, the cost per thousand impressions (CPM) has gone up significantly. Snapchat experienced a 64% increase, Facebook 89%, and TikTok 92%. These considerable cost increments indicate the financial pressure that businesses face in online advertising.
Stores Drive Profitable Growth in Online Sales
Many people believe that online sales are the main source of revenue for businesses. However, physical stores have shown to be profitable and play a significant role in increasing online sales. Although the revenue contribution and sales increase in the online channel are still important.
The combination of physical and digital channels creates a strong sales ecosystem. When customers visit a store, they tend to stay connected with the brand online as well, and vice versa. This cross-channel behavior results in greater customer loyalty and a higher lifetime value.
Many brands are discovering that physical stores can be highly profitable. As a result, stores are making a comeback in brand strategies. This resurgence is not just a nostalgic impulse, but a well-considered response to the changing retail landscape. Moreover, having a physical store can also have a positive impact on other channels.
How Online Capital Group Can Help
If you’re interested in expanding your brand’s reach to a wider audience, you can give us a call at (904) 600-3600. We can provide you with information on how we can help you leverage both your digital presence and traditional location to the fullest.
