Let’s get one thing straight, retail isn’t dying, it’s evolving. Before the internet and Amazon dominated the retail industry, there was the catalog. The catalog disrupted the retail industry, giving consumers the ability to shop from the comfort of their Lazy Boy.
Today, we are experiencing a new retail disruptor—the internet. The internet paved the way for online-only retailers to establish themselves as trusted and well-known brands in a highly-competitive marketplace. Even though the internet has transformed the way consumers purchase goods—the catalog didn’t kill retail, and neither will the internet.
The internet is a key player in retail’s renaissance.
As consumers familiarized themselves with Amazon Prime and same-day delivery, the need for brick-and-mortar storefronts faded away. Retailers were no longer limited by physical location and could reach thousands of consumers through digital marketplaces like Amazon, Etsy and even social media.
Online brands have taken advantage of the internet’s power in creating brand loyalty by utilizing social media. Digitally-native brands like eyeglass manufacturer, Warby Parker, beauty brand, Glossier and mattress retailer, Casper have utilized social media to generate brand awareness and loyalty among consumers. Each online retailer has created a deep, personal connection with their customers which is becoming more vital in retail’s success.
With as much attention e-commerce has gotten from consumers, the need for a physical presence is becoming more crucial as people desire experiences over home delivery.
From clicks to bricks.
People want to touch, see and feel products before making a purchase, but online brands are limited to creating a virtual connection with shoppers. Knowing the need to foster an emotional connection with consumers, digitally-native brands are getting back to the basics of retail and opening brick-and-mortar storefronts.
Commercial development consultant, JLL estimates that digitally-native brands will open 850 physical stores in the next five years.
With the notion that the ‘retail apocalypse’ is upon us, online retailers making the shift from a digital to physical presence may seem like a questionable move. But in reality, online retailers establishing a physical presence is only increasing their brand awareness and enhancing their online performance. According to a study by the International Council of Shopping Centers (ICSC), opening a physical storefront helps the consumer not only put a face to the brand, but increases online traffic by an average of 45%.
Occupying both a virtual and brick-and-mortar space is a win-win for online retailers. Loyal customers will rush to experience the digital brand come-to-life, and a new group of consumers will get to discover the brand, their products and their digital platform for the first time.
However, the true measure of success is how online retailers will translate their digital brand experience to physical retail.
Meet the “new” retail anchors.
Consumers desire a unique retail experience and making deep connections with brands they trust. Online retailers have been able to accomplish this in the virtual realm—but how can they create a one-of-a-kind shopping experience in real life?
Online retailers have generated ‘hype’ around their brand through their online experience. This same excitement must be felt in their physical retail experience. Take online beauty retailer, Glossier for example. Glossier’s iconic pink-covered online presence and ethical beauty products have supported the brand’s loyal following. When the beauty brand opened its flagship store in NYC this past year, the storefront had to evoke the same feeling it created virtually. Shoppers flocked to Glossier’s pop up to see the brand come to life. After scrolling it's social media accounts, it’s easy to see why consumers would want to experience the brand first-hand and take advantage of the ‘Instagrammable’ storefront. The digitally-native brand has seen tremendous success by establishing a physical presence and is expected to continue growing its physical retail presence this year.
The catalog came along to enhance the shopping experience, just as the internet is doing today. E-commerce is transforming retail as we know it and those who are adapting are experiencing success in both virtual and physical realms. So, before widespread panic sets in, take a breath and remember if the catalog didn’t kill retail, neither will the internet.