Retailers recalibrate physical stores to meet demands of the digital shopper

Retailers in regions worldwide are hustling to “recalibrate” their sales and fulfillment strategies to keep up with a hybrid marketplace where the line between physical and digital commerce is becoming increasingly complicated, according to a study from logistics software vendor Manhattan Associates.

This latest evolution follows recent waves of change that have already swept over the retail landscape, including the swift rise of e-commerce, the digital realm, and pandemic chaos. Yet as the industry approaches a new peak season this winter, experts say it has become increasingly difficult to even distinguish between physical and digital retail, Atlanta-based Manhattan Associates said.

“Shopping habits have changed forever. There can be no return to the status quo, with 83% of global retailers now claiming they operate a level of interconnection between their online and in-store functions,” Ann Sung Ruckstuhl, Manhattan’s senior vice president and chief marketing officer, said in a release. “As the retail industry recalibrates for this next normal, the ability to navigate disruption, while enhancing the physical and digital customer experience will become increasingly important; as will the technologies that allow retailers to fulfil in-store and online orders in an agile, sustainable, and profitable fashion.”

One of business’ greatest challenges in hitting that target is that they lack a single view of inventory, the study found. Specifically, barely half of U.S. respondents to Manhattan Associates’ study said they are supporting mixed inventory pools such as buy in-store and return online (52%) or buy online and return in- store (55%).

To try to improve those numbers, retailers listed checking stock availability (66%) as among the most important customer-facing duties performed by their shop assistants. And they said the best tool for that task is the in-store handheld device, which provides a consolidated view of inventory across the network, spanning shops, distribution centers, in-transit (77%), and a view of customer transactions both online and in-store (73%).

Shoppers are pushing that vision, with almost a quarter of consumers (26%) now expecting shop assistants to be able to check availability in a nearby store if a product is out of stock, or order that product for home delivery or collection (15%).

That blending of functions between the physical and digital worlds may signify rising importance for the classic storefront, Manhattan Associates said.

“Over the last decade bricks & mortar spaces were seen as liabilities in a digital era. However, the perception of the physical store has been fundamentally changed by the impact of the pandemic,” Ruckstuhl said. “Today, many retailers are revaluating the roles of their stores, recognizing their added value as strategic hubs for online sales, not least as a fulfilment hub for click & collect, returns, endless aisles, same-day delivery, and more. While digitalization and frictionless shopping are certainly two of the big winners from the pandemic, the research shows that we should not be too quick to discount the importance of human interaction or the role of the physical store in the era of digital commerce.”