Coldwell Banker: Shopping ‘Experiences’ and Perks Drive Customers Back In-Store

Despite growing e-commerce, nearly three-quarters of U.S. adults said any retail experience is more likely to bring them to a brick-and-mortar store, reported Coldwell Banker Commercial Affiliates, Madison, N.J.

“We’re seeing that Americans still value in-store retail experiences in an increasingly e-commerce world, but brick-and-mortar retailers will need to embrace aspects of online shopping and invest in experiential retail to drive traffic in-store,” said CBCA President and CEO Fred Schmidt. 

Experiential retail includes classes, social events, free samples, wine tastings and other activities that draw customers into a retail store.

Schmidt said commercial real estate professionals “should think about how [online shopping and experiential retail] will impact the demand for physical space as retailers continue striving for the perfect customer experience.”

CBCA polled younger Millennials aged 18-29, older Millennials between 30 and 34, Gen Xers aged 35-49 and Baby Boomers between 50 and 69. It found that shoppers still value traditional brick-and-mortar shopping experiences. “Nearly half of Americans prefer to make purchases in a store instead of shopping online,” the report said. “Furthermore, shoppers want stores to be a hub for convenience and entertainment where experiential retail meets blended retail.”

Retail shoppers still crave a traditional shopping experience with tangible perks and events that e-commerce cannot offer, CBCA said. “Retail experiences can vary from in-store classes to holiday celebrations, but they always offer customers an incentive to come in-store and experience an event outside of the ordinary shopping trip.”

Nearly nine in 10 older Millennials–89 percent–said any retail experience is more likely to drive them to a physical store, compared to 74 percent of all U.S. adults. More than half of Americans polled said free samples make them more likely to visit a physical store, making samples the highest-ranked experiential retail experience by far. 

Nearly one quarter of younger Millennials (24 percent) said they would be more likely to visit a brick-and-mortar store if it offered fitness, cooking or art classes, a trend driven by the younger generation’s goal of blending retail and entertainment.

This could change the way retail stores are designed, Schmidt noted. “For years, retailers have offered customers free samples and product demonstrations as a way to drive traffic to the store,” he said. “Today’s expectations are much more complex, leaving retailers in need of more dynamic, open spaces that facilitate the types of experiences consumers want, such as an in-store fitness class.”

CBCA also found that consumers want e-commerce and brick-and-mortar stores to fuse “seamlessly.” More than one-third of Americans said they are more likely to make purchases online if they can return the items to a physical store. Similarly, 21 percent said they are more likely to shop online if they can pick up their items in-store.

To create seamless shopping experiences, retailers can combine e-commerce and in-store retail to make the physical store a focal point of activity, Schmidt said. But with this trend comes a challenge: the logistics of in-store pick-ups and returns.

“Retailers are beginning to invest in off-site warehouses to handle merchandise for in-store transactions involving pick-ups and returns,” Schmidt said. “Stockrooms and fulfillment centers will need to be expanded, but despite these challenges, e-commerce can be a huge traffic driver and offer a unique advantage to brick-and-mortar retailers by getting customers through the door.”