Retailers are improving their in-store game
While online sales continue to outpace in-store purchases this holiday season, according to PYMNTS ‘Black Friday shoppers survey, consumers are visiting stores more often than a year ago – and some can find a transformed retail experience.
In Charlotte, North Carolina, for example, Best Buy tested several new store models in five locations that have undergone minor changes and two with new and expanded product categories, such as an “Autotech Megahub” and a factory Outlet. Each store is also testing different types of fulfillment and services, such as new pickup bins and more warehouse space for online orders.
Best Buy is also testing a virtual store built into a distribution center, with dedicated associates but not inviting any physical customers. Instead, buyers interact via chat, audio, video, and screen sharing to see live demos and physical products.
âStores are critical to our customer experience, and they need to be even more efficient and need to keep pace with increased customer expectations,â CEO Corie Barry said on a conference call with analysts last week.
Related news: Best Buy Pinpoints Future Sales on HealthTech and Virtual Stores
Dick’s Sporting Goods has also made a series of investments aimed at improving its physical presence, opening more low-cost stores and launching an experiential House of Sport concept that includes a turf field and a running track, a wall of climbing, a batting cage and a putting green. , all of which are intended to lead foot traffic to physical locations.
In September, the retailer also opened a new outdoors-centric store concept called Public Lands, which includes an assortment of outdoor and lifestyle clothing, footwear, and gear.
âOur strategies continue to work as we reimagine the athlete experience within our core business and with new concepts,â said Ed Stack, Executive Chairman, in a statement earlier this month. “As we said before, we believe this will be the most transformational year in our history, and we plan to continue this transformation until 2022.”
Read more: Dick’s Sporting Goods focus on experiential retail drives third quarter sales
According to PYMNTS research, more Black Friday shoppers returned to stores in 2021 than in 2020, but ecommerce still generated more business from shoppers during the annual sales event. Over 27% of shoppers made purchases online on Black Friday, while 22% said they made purchases in-store and 16% said they did both. About 35% said they did not shop on Black Friday.
Also see: Out-of-stocks cost retailers up to $ 4.6 billion on Black Friday
The holiday test
In September, Mastercard SpendingPulse forecasted that department store sales would increase 15% year-over-year during the holiday season, which would also represent a 5.2% increase in sales from 2019.
Granted, 2019 was another year in which department stores struggled, with same-store sales down 1% year-over-year at Macy’s and net sales down 8% at JCPenney, who a few months later filed for bankruptcy. However, Steve Sadove, former CEO of Saks and senior advisor at Mastercard, told PYMNTS he hasn’t seen this kind of growth in the department store industry in years.
Whether people will continue to patronize physical stores for years to come will likely depend on how satisfied consumers are over the next several weeks as they shop for gifts and shop after Christmas. If this is a great experience where people find what they want and get good service, Sadove predicted that they will likely return even if they keep buying certain items online; otherwise, the physical locations could be in trouble.
âThe fastest way to go into a downtrend is to not provide a good consumer experience,â he said. âWe’re at that point right now, and some are going to do it well and some are not going to do it well. And that’s going to affect how it plays out over the next six months to a year. “
Read more: Holiday 2021: pent-up consumer demand, in-store experience test for retailers