Written by Alberto Chiumento and Paolo Laudani
(Reuters) – The rise of online shopping has led to store closures and cast doubt on the future of retail malls and high streets, but there are signs that stores are coming back into fashion in Europe and will play a key role in promoting online sales. Fulfilling.
European retailers are investing in brick-and-mortar stores to drive both online and offline sales as they face increasing competition from e-commerce giants such as fast fashion group Shein.
It also hopes to capitalize on people’s newfound desire to visit stores as Saturday afternoon shopping becomes popular again as the coronavirus lockdown eases.
“I come to the store because I want to see the product, try it, and get it right away,” said Francesca Marini, 28, who was shopping at a shopping mall in Rome. She said the wait time when shopping online ruins the experience.
According to data from market research firm Euromonitor, the number of stores across Europe will decline slightly from 4.92 million a year ago to 4.9 million in 2023. However, sales space, measured in square meters, will increase by just nearly 1%, rising to 2.7% in 2028 compared to 2022, the data shows.
Thomas Joekel, a portfolio manager at Union Investments, which owns shares in LVMH and Adidas (OTC:), says retailers know it’s hard to retain customers without direct contact with them. said.
“This is easier to achieve with brick-and-mortar stores as well as e-commerce,” he said. “On the e-commerce side, you can only see pictures, but you don’t feel it, smell it, or talk to someone about it. So it’s much less optimistic or enthusiastic about the brand. “It’s difficult,” he said.
try before you buy
Since the pandemic, sports retailers have seen an increase in demand for products such as running shoes and training kits as people make the most of their time outside.
“You look at the success of Adidas and The North Face and others, but I think there’s definitely been a trend towards more outdoor activities, partly due to the impact of the pandemic,” said Adam Cochran, an analyst at Deutsche Bank. “People realized they needed to get out and do something, and I think some of that behavior is here to stay.”
French sports retailer Decathlon has added about 80 stores to its network this year, bringing the total number of stores worldwide to about 1,700, according to global chief customer officer Celine Del Genes.
Cisulfa, an Italian retailer that sells sports apparel such as Nike (NYSE:) soccer shoes and Under Armor (NYSE:) running T-shirts, has approximately 160 stores in Italy, and has approximately 10 stores in Italy. Are you planning to open or renovate a store? This year’s home market.
The company recently expanded its store count in Germany to 75 stores with the acquisition of SportScheck, adding 25 stores to its German portfolio.
multichannel shopper
According to data cited by Cochrane, having a brick-and-mortar store can increase online sales by 10% to 20% within a 20-minute drive of a store because more customers are multichannel.
“There’s clear evidence both ways that when you open a store, you increase online sales around that store,” he said. “And conversely, there is evidence that if you close a store, whether you move it online or to another store, you are not fully recouping all of that revenue.”
“The more stores there are in a region, the more interest there will be in online brands,” said Stefan Reiner, chief sales officer at mountain sports retailer Oberalp.
To attract shoppers, Decathlon will feature a dedicated location for equipment repair and rental, as well as an area where customers can enjoy sports.
“The stores will offer new features such as showrooms and discovery stations to integrate physical and digital elements, allowing customers to explore, analyze and compare products,” Céline Del Genes, the company’s chief customer officer, told Reuters. “It makes it easier,” he said.
At a shopping mall in Rome, Decathlon placed two ping pong tables near the store entrance for people to play for free.
“It’s a good idea,” one young player told Reuters as table tennis balls were flying around and friends debated whether a shot was in or out. “It’s a good idea. We can have fun in a place where we usually just come to buy.”
Spanish retailer Inditex (BME:), which owns the ZARA brand, offers group fitting rooms where friends can try on clothes. The fitting rooms are also equipped with touch screens, allowing customers to request different sizes and styles.
In Germany, online retailer Zalando already has 15 physical stores in the country and is building another in Freiburg in the south.
Like other retailers, Zalando, which sells everything from swimwear to Hugo Boss dresses, is battling increasing competition from Shein. The Singapore-based online retailer employs a “pop-up” store strategy, opening stores in cities in Europe and the United Kingdom and closing them a few days later.
Industry experts believe shoppers prefer the human touch and convenience and immediacy of in-store purchases.
RBC analysts said, “Consumers are rediscovering the leisure aspect of shopping and choosing to return to stores. They also like the convenience of click and collect, and as people return to the office… “This means that people are less confident in staying at home.” For delivery, they said.
“Some people just want to buy a T-shirt and go to a party or go to school. If they have to wait two weeks, that’s too long,” said Joekel of Union Investments.
