Retailers see an average 12% increase in online sales in the catchment area after opening a new store, according to a research report published today, while 29% of online sales are reliant on physical stores. The report, titled Tomorrow’s World: Retail on the line, also reveals that 39% of returns purchased online are returned through store networks.
The data for the report was captured by CACI and GlobalData, on behalf of Revo. Surveys were conducted among 2000 UK shoppers and a cross-section of 50 major multichannel retailers that have had a presence in the UK for more than 10 years. The research was commissioned to improve the current understanding of the way in which customers are changing their shopping habits and how retailers are responding. Overall, the research concludes that the relationship between physical and online is and will remain mutually beneficial, supporting revenue and sales growth. Click and collect customers are particularly valuable with each trip generating on average an additional €77.9 (£68) of spend per household.
It shows that physical stores remain an integral part of a retailer’s ability to drive sales and meet consumer demands, but that the strategic role of stores is changing; their value as a marketing and brand tool, while also providing convenience to customers in their purchasing journey, is increasing. However, many retailers are yet to get to grips with the complexities of the modern retail environment, including the blending of channels and new functions of physical store: almost half (46%) of retailers interviewed are either not very confident or not at all confident about making appropriate decisions about their stores, suggesting that challenges remain to be solved to create a retail environment that functions optimally.
Mark Williams, Revo President said: “The research clearly shows that, contrary to what some would have us believe, the physical store has not disappeared from the customer’s journey and in fact is very much alive and a fundamental part of the shopping experience – and will remain so. I think we all acknowledge however that its role has changed, and it is critical that industry stakeholders – retailers and property owners alike – continue to evolve and together take a proactive approach to meeting ever-changing consumer needs. Collectively as an industry, we need to start thinking more like consumers; online and offline are not binary terms but fully intertwined, mutually dependent ways of shopping. Revo is developing a programme of work, with both influential retailers and owners to support and accelerate the sector’s response to the modern retail environment.”