The Role of Physical Retail Stores in a Digital, Post-Pandemic World, Do Old Habits Die Hard?

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2023-04

Authors

Eisler, Benjamin

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Abstract

We live in a dynamic retail environment. COVID forced retailers to adapt to new consumer behaviors quickly and develop robust omnichannel fulfillment infrastructures— meaning that online and offline channels had to be integrated. Today, e-commerce offerings are more robust than ever, and customers have more choices than ever regarding how they shop. Considering this dynamic environment, I have several questions about how retailers can persuade consumers, who became accustomed to e-commerce during the pandemic, to return to their stores. Furthermore, I am interested in evaluating retailers’ strategies to make their physical retail stores more appealing. Despite the growth of e-commerce and the ongoing pandemic, some American consumers expressed a desire to return to shopping in physical retail stores. According to a 2021 report, 57% of US adults “expressed excitement” to return to in-person shopping

  1. Today’s retail environment is uncharted territory. Consumers have more channel options than ever before. Retailers have made significant changes because of the pandemic, which has rapidly accelerated digital transformation.

My research examined whether customers who became accustomed to online shopping during the pandemic returned to physical retail stores. Through in-depth interviews with retail executives and managers, ethnographies, and a questionnaire, I sought to understand whether customers are returning to stores and to discern which strategies and decisions have been effective for persuading customers to return to stores and demonstrate loyalty towards a brand. My findings reveal that while some customers became accustomed to the convenience of online shopping, after realizing they could fulfill their needs without visiting stores, many customers longed to return to physical retail stores, and are shopping in stores, like how they behaved during the pandemic. My findings also revealed that consumers’ desires to visit stores vary by industry and shopping occasion. Additionally, many customers who use digital technology and e-commerce also value being able to visit the stores for returns, interact with merchandise, and seek out expert advice. While my questionnaire findings did not provide significant insights into how the pandemic changed behavior, they provide insight into how consumers choose between shopping online or in person for certain occasions. Ultimately, my findings provide a basis for further research on how retailing has changed because of the pandemic and omnichannel transformation.

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