New Study Shows Brick-And-Mortar Stores Have Direct Online Impact For Retailers

Though some in the industry have been banging the drum of omnichannel retail, a new study has found a more direct link between brick-and-mortar and online retail than ever before.

In what it called the largest survey of its kind, the International Council of Shopping Centers found that across several factors, establishing a physical presence significantly increases online customer engagement. Opening a first location within a market caused an average 37% increase in traffic for a store’s website, ICSC’s survey found.

The bump in awareness and engagement is even more profound for emerging retailers making the transition from online-only to omnichannel, with brands less than 10 years old seeing a 32% increase in web traffic for every new store opening. Brands older than 10 years still see a 27% bump in average web traffic for each new location.

The converse is also true, according to ICSC, with retailers seeing drops in web traffic after closing stores. The survey tracked one chain that closed between one-third and half of its stores and lost 50% of its web traffic over the length of the survey period (between February and March 2018). But brick-and-mortar’s impact goes beyond mere clicks, according to the report.

ICSC rated retailers across five metrics of “brand health” in increasing order of impact: general awareness, consumer impression, willingness to consider buying, identifying personally with a brand and recommending a brand to others. For 21 retailers across 10 markets, ICSC found that those with a physical presence in the studied market ranked ahead of nationwide benchmarks in all five metrics.

In no sector of retail is the interplay between brick-and-mortar and online shopping more crucial than apparel, ICSC found. Brands like UNTUCKit, which started online and now has dozens of locations across the U.S., use the data they gather online to more specifically cater to customer demands. That both saves money by allowing for a more targeted inventory and increases brand allegiance by improving customer service.

“Execution on the sales floor helps drive loyalty, retention, and customer engagement,” Cowen and Co. Managing Director Oliver Chen told ICSC. “For example, helping customers with personalized product advice and service, delivery options, and inventory access across channels, and providing human solutions to any customer pain point in the shopping experience is more important than ever.”

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