Retail stores are in dramatic decline, undercut by e-commerce giants like Amazon and the convenience of online shopping. The COVID-19 pandemic has only accelerated this shift, with e-commerce now accounting for more than 1 in 5 retail purchases — a significant jump from online sales in 2019.
Is there a future for physical stores and experiential retail when e-commerce has become so convenient and is gaining in popularity? If physical stores do offer customer value, is this more important for some kinds of brands than others? Amid the heightened uncertainty about the future of in-person retail channels, I investigated what brand attributes affect customer preferences for shopping online versus in stores.
When do customers prefer brick-and-mortar retailers?
We know that consumers are uncomfortable buying big-ticket items online without first seeing and interacting with them in stores — an attitude surprisingly prevalent among younger consumers. Studies also show that customers visit stores to answer questions about the fit and quality of some products (sweaters and eyeglasses, for example), but once they have answered these questions, people will migrate online for convenience. What research hadn’t addressed is how brand characteristics, beyond fit, quality, and price, affect which sales channels consumers choose and whether (and why) customers would continually visit physical stores once they knew about a product’s quality.