When the German Institute for Retail Research (IFH) analysed the future of brick and mortar shops at the beginning of this year, it came to a sobering result. Even before Covid-19 hit the world, it expected that 26,000 to 64,000 retail stores in Germany would close by 2030, because of changes in consumer behaviour. Covid-19 is expected to speed up this development, pushing sales online even faster.
Already at ShopFactory we can see that online sales in the last two weeks are on average 16.3 % higher per merchant than for the same two weeks last year.
This is a development echoed around the world. The only options for brick and mortar stores to survive according to the IFH are to create emotional buying experiences and to make buying as easy and comfortable as online.
Essentially the institute says that brick and mortar shops must simulate the ease of online buying and turn shopping into an experience rather than a chore.
With same and next day deliveries becoming more common, even the advantage that customers can have the product immediately is losing its lure. Especially as the product desired may not even be available in the store.
The only options for brick and mortar stores to survive according to the IFH are to create emotional buying experiences and to make buying as easy and comfortable as online.Click to tweet
What does this mean for you?
If you have a brick and mortar store, make sure to extend your online shop, if you want to survive. Make more of your products available online. If you only have a website created with ShopFactory, start adding your products, and enable online buying. It will help you get some sales right now, which you will otherwise lose during the lock-downs and help you safeguard your future.
Some of the most successful shops created with ShopFactory are owned by merchants who started out with brick and mortar retail stores and began moving online years ago with ShopFactory.
Many still have physical retail stores, but they could survive with their sales online as well. Positioning them ideally for a future in which fewer and fewer people want to use their time to get off their back, get in a car and drive to a store. Unless that store offers something very special.
Covid-19 has added a new dimension to this, and we don’t yet know exactly how this will play out.
While some stores were closed by governments, the virus is also making people afraid of entering physical shops. The longer the lock-downs around the world take, the stronger this aversion will become. And the more deeply it will become ingrained. Making it even harder to encourage people back into retail stores, when this is all over.
If and how well that will work, only time will tell. But one thing is clear as a result of this research. The future of retailers not selling online is looking grim.
- Steffan Klein