‘Stores are here to stay but how should they adapt to different shopping missions?’

I’ve had a number of conversations recently with people who have been asking: “Where has online gone?”

While some are confused about the recent fall-off of online shopping, it’s an underlying trend we at PwC have been talking about for some time. The store is here to stay, with a thriving, young customer base.

Clearly, it’s not all doom and gloom for online retail, but it is going through some changes. Throughout Covid, we saw online penetration rocket to nearly 40% with almost everyone predicting it was the new panacea.

But that’s never been what our research has suggested. Our The Consumer Reconsidered report, for example, revealed that, while nearly three-quarters of consumers choose a digital channel to begin a big-ticket journey, only 59% of those individuals ultimately buy the product online.

Consumers not only understand and appreciate the value of physical stores – and the high street experience – but buying behaviours are as unique as the individuals themselves.

“While it remains predominantly an online event in the UK, a bigger proportion of spending is expected in store this year”

Their fondness for the store is again reflected in our Black Friday survey findings. Away from a waning interest and a fall in predicted spend from £7.1bn to £5.6bn, there are some positive signs for in store.

While it remains predominantly an online event in the UK (68% of spending), a bigger proportion of spending is expected to be in store this year.

We’re expecting every third pound to be in store or via click and collect, compared with one in four just two years ago.

Young people are driving that trend, with almost half of spending by under-25s expected to be in store or via click and collect.

Interestingly, this usually reverses for Christmas, with older people shopping in store and younger people shopping online.

Overall and excluding the pandemic, Christmas spending has been broadly balanced between online and in store (including click and collect) for a number of years, showing the resilience of stores.

Clearly, there is a great affection for stores. And our store openings and closures data for the first half of this year confirm it, showing net closures at their lowest since 2017, openings improving, stabilisation across the board and strong performance for retail parks.

All of this presents a compelling case that the store is here to stay. But it’s important for retailers to think about the role of different stores in different locations and how they service individuals.

“For some, stores might offer an exceptional or tailored experience allowing customers to experiment and interact. For others, it could simply be convenience”

These might even need to vary across the same brand, with consumers looking for different solutions in different locations for different missions.

For some, that might be an exceptional or tailored experience allowing customers to experiment and interact. For others, it could simply be convenience.

Much like everyone else, my shopping missions can vary hugely. Recently, I was back in Blackpool and took my mum to buy the new computer she needed.

Living in London, I don’t often get the opportunity to visit a retail park and might have ordered online for delivery. But in this instance, I wanted to speak to someone, make sure my mum could see and feel the product before she bought it and ask any questions in person.

The staff were really helpful, talking my mum through important things to think about, how to use it and other useful tips such as which models were best for seeing the keys. We could pick up the computer then and there and take it home.

In that instance, personal interaction was hugely important for my mum – and something she just couldn’t get from a purely online experience.

In an opposite example, I am happy to grab a takeaway dinner from a fast food drive-thru when the kids are hungry or click-and-collect groceries on the way home from work.

These different situations highlight just how important it is for retailers to think through how they meet people’s needs for different times, places and shopping missions.

None of this is to say online is dead and buried. Far from it. We know that online still makes up the majority of retail spending for Black Friday and retains a significant share of wallet overall. But this shift back to the store is strong evidence again that the store is here to stay and can thrive.