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EDITORIAL How physical and virtual retail cement their place in the new world of shopping

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While ecommerce continues to grow and develop, especially cross border and among millennials, news from the US about the retailers that rank highest in Google searches paints a wholly different picture.

The data, from Searchmatics, suggests that ‘big box’ retailers including Apple, Walmart, Nordtrum and BestBuy dominate the search rankings – and all of them have a large physical footprint. In fact, no pure play online retailers make the top 10.

So, what gives? According to the study, these retailers are topping the charts not just because they are well known and well-loved brands regardless of channel, but also because they have nailed omni-channel. Click and collect, curb-side pick-up and Bopis have all triumphed across the re-opening of retail, with consumers embracing online, but still wanting to head to stores.

Across the pandemic these retailers have improved their online offerings immeasurably and, combined with introducing these hybrid retail tropes, have re-established their presence in the changed retail landscape.

What does this mean for UK retailers? Pretty much the same story is likely being played out here too. Big box retailers have done much to improve their online presence and many have introduced new hybrid models, such as M&S drive through.

But there is still an elephant in the room: returns. One reason why stores are re-attracting shoppers is that the online returns offering from many is not up to scratch. In fact, it’s one of the biggest bugbears among consumers, with 89% saying that returns policies and logistics is now their top online shopping priority.

What is interesting is that for two thirds of them they actually want ease of exchange of items rather than just simple returns. This is something that real-world stores offer and is likely to continue to see these players continue to fight back.

And fight back they all must, as one of the other upshots of the pandemic and the changing shopping habits it has instilled has been a decreasing brand loyalty among shoppers.

While 42% of shoppers say that they prefer to shop with brands they know and have used before, they are happy to switch if they get a better price or better service. 35% actively try new brands just for the hell of it.

This drive for better prices and convenience is seeing some online models, however, start to carve out quite a niche for themselves. Secret Sales, for example, which sells end-of-line luxury fashion has seen tremendous growth across 2021, adding a whopping 687 new brands to its roster – and attracting 31 million unique visitors.

There is clearly room for both online and physical retail in the market, but the two are increasingly closing in on each other. The physical is there to augment the digital, with click and collect and returns. But don’t underestimate the role of digital. It is there to enhance physical and, with more interest than ever in the metaverse and virtual shopping technologies, we are likely to see yet more change and more hybridisation in the months ahead.

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