New research revealing a symbiotic relationship between a brand’s physical stores and its e-commerce platform was recently published by British Land, a real estate investment trust company.
Using data from Connexity Hitwise, the research shows that when a new store opens, traffic to the retailer’s website from the surrounding postal area increases by 52% on average within six weeks of opening. Importantly, digital traffic from the local area then remains around this level (see figure 1), demonstrating that a physical store has a significant, positive, and sustained impact on digital interaction with the brand, according to British Land.
British Land further states brands with fewer than 30 stores enjoyed the greatest positive impact from store openings, with uplifts in local traffic to their websites of 84% on average (see figure 2), showing that a physical store can make a critical contribution to the online success of expanding brands.
These findings take the real estate investment trust company’s True Value of Stores research one step further and starts to quantify the ‘halo effect.’ More work is already underway, in partnership with Revo, to measure the distinct contribution of each channel and ensure leasing models and valuation methods reflect the benefit of the store to retail businesses as a whole, according to British Land.
“One year on from the True Value of Stores report, the findings are more relevant than ever,” says Ben Dimson, head of retail business development for British Land. “Blending channels is increasingly common, pure-plays are still moving to physical and click & collect, an increasingly important link between physical and online, is continuing to take ground. Click & collect usage is on average 46% greater than the national average at our local centers proving they are particularly well positioned for omnichannel shopping.”
The research shows that physical stores are an engine of online growth. Consumers choose brands that align to their lifestyle and values: a physical store enables a retailer to demonstrate its brand in action and drive interest online, explains Charles Maudsley, head of Retail, Leisure & Residential for British Land.
“At the same time, stores enable retailers to respond to evolving shopping habits, market their brand effectively, and deliver products more efficiently,” Maudsley says.
For insights into online retailers opening offline stores, attend the Shop!X Annual Meeting, Nov. 8-10 in San Antonio, Texas, U.S.