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Do retailers need a new perspective on physical stores?

Jan 30
 
Tags: Capgemini
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Do retailers need a new perspective on physical...

There is a "growing divide" between retailers and consumers as far as the importance of physical stores is concerned. That's one of the key findings in a recent report from Capgemini's Digital Transformation Institute, titled 'Making the digital connection: Why physical stores need a reboot'.

The research was based on a survey of 6,000 consumers and 500 retail executives from nine countries, including the UK, the US, France, Germany and China. Less than half (45 percent) of the consumers surveyed felt that bricks-and-mortar stores remain an important part of the retail industry, compared with 81 percent of executives.

Many people have become frustrated with in-store shopping, with 40 percent of respondents describing it as a chore and 32 percent saying they would rather be at home washing the dishes.

The study suggested that dissatisfaction often stems from disparities between the online and 'offline' shopping experiences. 

Seven out of ten consumers (71 percent) said they find it difficult to compare products in-store and 66 percent were put off by long queues at the checkout. Around two-thirds said in-store promotions are generally irrelevant (65 percent) and they often struggle to find the product they want (65 percent).

More than half (54 percent) of retail executives admitted they have been slow to digitise their physical stores.

Nearly eight out of ten (78 percent) identified in-store digitisation as a top priority, but there are hindrances such as existing technology investments and the capabilities of staff. Four out of ten executives (40 percent) said they were still in the process of getting fundamental technology such as in-store Wi-Fi in place.

With so many physical shops remaining "stubbornly offline", Mike Petevinos, global head of consumer products and retail at Capgemini Consulting, said it's "easy to see why" many shoppers are "increasingly disconnected" from the in-store experience.

He added: "Rumours of the death of the high-street store may be exaggerated, but they are becoming uncomfortably close to the mark. Many retailers we spoke to admit they aren't digitising stores quickly enough because making a business case for investment is challenging.

"This report makes it clear the real question retailers have to be asking themselves isn't whether they can afford to transform the in-store experience, but can they afford not to?"

The latest monthly figures from the British Retail Consortium (BRC) showed that footfall in UK shopping locations during December 2016 was 0.2 percent lower than a year ago. It was the fourth consecutive month of decline, but the drop was much slighter than the 2.2 percent fall recorded in December 2015.

Footfall actually increased by 0.8 percent in the high street - the first rise for this location in five years - but declined in retail parks (-0.7 percent) and shopping centres (-1.9 percent).

BRC chief executive Helen Dickinson said retailers have to "gear themselves up" to respond to the "evolution in shoppers' requirements" away from bricks-and-mortar stores.

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Image: iStock/AndreyPopov

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