The retail landscape, deeply transformed by the Covid-19 pandemic, is demonstrating resilience and a symbiotic relationship between physical stores and online sales. Despite the surge in digital shopping during the pandemic’s peak, recent data indicates that brick-and-mortar stores remain essential for driving growth in the retail sector.
According to an ICSC (International Council of Shopping Centers) report, opening a new retail location can temporarily boost a brand’s digital sales by 6.9 percent, while closing a store might reduce online sales by 11.5 percent. This data underscores the integral role of physical stores in supporting and enhancing digital commerce. Additionally, a CBRE report highlights that, by 2022, 78 percent of retail sales growth stemmed from in-store purchases, a significant jump from 46 percent in 2019.
“Retailers face numerous obstacles to finding the prime space they desire, including record-low availability and rising rents,” Laura Barr, Americas Retail Leader for CBRE, commented on the current market challenges. She noted that these conditions are prompting retailers and investors to find creative solutions to meet their growth targets.
Furthermore, the reports dispel the notion that e-commerce will replace traditional retail. Instead, online sales are seen as a complement that leads to more in-store transactions, particularly in street retail, where unique experiences cannot be duplicated online. This blend of physical and digital sales channels points to a robust future for the retail industry, where brick-and-mortar remains a vital component.
