8 reasons to invest in retail: why the physical store are still essential

During the lockdown period because of the Covid-19 pandemic, e-commerces became a fundamental channel for retailers. Even as overall retail spend decreased, eCommerce sales rised up in the previous year. The impressive results Showed a curious issue: eCommerce still represents just a small percentage of total retail sales. In fact, in the U.S., the number is as low as 14.5%, according to eMarketer data.

Over 85% of retail still happens in physical stores, which makes a synergy between online and offline key to retail success in the near future.

We identified 8 reasons why you should still invest in a physical store location, for example an iot domus franchisee.

1. People felt supported to buy a product when they’ve seen it in person, and they've been assisted.

According to KPMG research, the top reason why consumers prefer to shop in physical stores is to see, experience and test products in person before buying them. It's important having a physical location where people can go and make sure that, yes, this cable or this lamp is exactly what I want, also the assistance of the seller can dispel consumer doubts and help close a sale. Seeing things in person can, also, reduce the risk that a product will be returned because it’s not the right size/color/material.


2. Customers who pick up items in store buy extra stuff.

If you have good seller in or a good exposition, it will work for you. Click and collect (also known as BOPIS, buying online and picking up in store) and curbside pickup are extremely popular both with customers and retailers. Compared to home delivery, pickup can be more convenient for customers, as it enables them to get their purchases when they want, without having to wait for a courier at home. For retailers, in-store pickup offers plenty of benefits: it’s cheaper than delivery, it brings shoppers through the doors, and it can lead to bigger baskets. According to Forrester research, 30% to 40% of consumers using click and collect buy additional items when they get into the store.


3. Physical stores can reduce the cost of returns.

Every product bought in physical stores are less likely to be returned than products bought online. According to David Sobie, co-founder and CEO of Happy Returns, “shoppers return 5-10% of what they purchase in store but 15-40% of what they buy online.”

Letting shoppers exchange or return in-store the items the bought online can also help reduce the cost of returns by removing shipping and transportation fees for the retailers.


4. High-quality, one-on-one customer service increases sales.

Despite the popularity of online shopping, the human touch is still an important part of the retail experience. According to research for RetailEXPO, almost two out of three (64%) of shoppers say that knowledgeable sales associates prefer to visit a physical store, and for three out of four (75%) of shoppers are more friendly with an experience one-to-one, they are likely to spend more after receiving high quality service from staff in-store.


5. The brand experience is still inherently physical.

Retail is a highly competitive industry. While it can be hard to stand out online, a physical store gives you the chance to create an engaging brand experience. Our format for example, can enable franchisee to immerse customers in their brand culture, creating lasting impressions. Designing an experience that has the right balance of safety, excitement and convenience is key – and can help differentiate your brand from the competition.

6. You can use stores as part of your supply chain.

In omni-channel retail, logistic costs can spiral out of control, and erode margins significantly. With Iot Domus it’s easy to realize savings by using some or all of the physical stores of our chain as warehouses and fulfillment centers, to support and strengthen their supply chain. Transforming a store location in a so-called “dark store” can help reduce costs of inventory management and expand the reach across larger geographies by enabling faster, more effective distribution.

7. You get free market research on your customers’ preferences and habits.

Retailers can learn much about their customers just by watching them shop, speaking with them about their needs, interacting with the space and products. “

8. Physical stores bring greater traffic to your online store.

Research from the International Council of Shopping Centers shows that when a retailer opens a new physical store location, traffic to their website increases by 37% the following quarter.

A lot of online projects can start form the physical store. Speaking about Social Media Campaigns, or marketing operations.


Ask us more info about Franchising store of IOT DOMUS. Contact us at helpdesk@iotdomus.com.

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