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10/07/2021

Why Online vs. In-Store Shopping Is Not a Binary Choice

Joe Skorupa
Editor at Large
Joe Skorupa profile picture

It’s not enough for legacy stores to continue to base their success on signage, neat rows of product, and promotional displays at a time when digital shopping has accelerated more in one year than in the previous five. This is one of seven critical insights uncovered in an early look at findings from the upcoming SAP Pulse Check poll of retailers.

Study data indicates consumers want to shop using both methods interchangeably – online, for the convenience, and in stores, for the physical/social experience. This makes it imperative for retailers to seize the pandemic pivot and implement a deeper blending of the digital and in-store shopping experiences.

Here are the top seven preliminary findings in the study:

  1. Customers expect retailers to increase digital shopping capabilities and engagement via the web or mobile apps. Specifically, this plays out through increased demand for curbside pickup and home delivery services as well as engaging through new digital experiences such as augmented reality and virtual try-on technology.
  2. A deeper mix of in-store and online shopping methods is forecast to be the preferred way consumers will shop in the future. Implementing a deeper blending of in-store and online shopping will increase store engagement and store visits, according to the study. Also, consumers are increasingly engaging with brands and purchasing from such new channels as social media, marketplaces, and influencer feeds.
  3. Targeted marketing has shifted to digital platforms using data that combines past purchase history with searches on websites and mobile apps. Although several years in the making, the movement away from traditional print, catalog and ads on mass media has become a major pivot.
  4. Physical stores need to confirm their intrinsic value proposition while simultaneously broadening value for the in-store shopping experience. This means, according to study data, stores need to maintain large assortments and inventories of products to avoid stock outs, while at the same time adding new concierge-like services such as enabling store associates to engage with customers and provide recommendations.
  5. Changing customer preferences highlight three big challenges for retailers: 1. Predicting demand and keeping the right quantities stocked in the right locations; 2. Maintaining the health, safety and morale of associates and customers; and designing localized assortments and bringing the right products to targeted customers.
  6. The sharp increase in digital shopping will have a major impact on supply chain strategy. This will manifest in three big ways: increased fulfillment from stores for digital orders, enhanced end-to-end visibility throughout the supply chain, and increased automation in warehouses.
  7. Just 38% of retailers are fully ready with processes and technology in place to understand customers and execute against insights in marketing, merchandising and supply chain operations. However, of the remainder, 44% say they are somewhat ready with good tools in place to understand customers although they are hampered relying on manual processes to execute against these insights.

The retail industry Pulse Check study provides data-based insights into the key marketplace and consumer trends that are critical for retailers to use as they create game plans to respond, recover and reimagine their brands beyond pandemic. Pay attention to RIS for news for the release of the full study data later this year.