5 charts on the importance of physical retail and improving the in-store experience

The majority (83.7%) of US retail sales take place in physical stores, per our forecast. The retailers that can infuse digitally forward strategies into their in-store experiences are more likely to win over consumer dollars.

Here are five charts on why the in-store experience is so key to retailers’ success and how they can use technology to create a more seamless, engaging shopping experience.

1. Physical stores are still effective at encouraging impulse purchases

Nearly one-third (31.5%) of shoppers purchased an item right away after discovering it, per our November 2023 survey.

To create more opportunities for impulse shopping in-store, retailers can consider using seasonal items to inspire shoppers to “get it while it lasts” or create a last-minute shopping hub in the front of the store.

2. Mobile can be used to enhance the shopping journey

Mobile is an increasingly important part of the in-store experience as shoppers use their phones to compare prices, check customer reviews, or get more information on a specific product or brand, per August 2023 1WorldSync data.

Retailers can use this behavior to their advantage by beefing up their mobile apps to highlight product attributes, relevant customer reviews, recipe ideas, decor inspiration, and any other information that helps consumers decide.

3. Retailers lean on tech to improve the in-store experience

Some retailers are using in-store tech to increase customer engagement or streamline the shopping experience, according to October 2023 Retail Systems Research data.

Contextual marketing strategies, which include sending SMS and emails to customers in-store, help retailers target consumers with relevant deals as they move through the store. For example, serving a customer an ad for chicken soup on a rainy day, or a guacamole recipe ahead of the Super Bowl.

4. Store displays are declining, but in-store retail media is on the rise

Perhaps because retailers are using more tech-driven strategies, the number of displays in grocery stores has been on the decline since 2018, with general food, alcoholic beverages, and beauty products seeing the most declines, per Q3 2023 data from Circana.

However, we forecast US in-store retail media ad spend will increase 35.3% this year to reach $370 million, signaling that retailers aren’t slowing down on in-store displays, but perhaps streamlining their strategies, placing displays in places they will make the most impact.

5. The in-person experience remains valuable to retailers and consumers

Despite technology’s role in the physical store, the in-person experience is still key to retail success, helping retailers increase conversions, drive loyalty, and boost brand awareness, per April 2023 data from Bain and Aptos.

Physical retail is important to the customer experience, too. In-person is among the top three ways consumers engage with companies, per an August 2023 report from Salesforce.

This was originally featured in the Retail Daily newsletter. For more retail insights, statistics, and trends, subscribe here.