Retailers who are expecting continued growth in comparable (a.k.a. “comp”) store sales at their brick & mortar locations are likely to be disappointed as comp store sales have seen little to no real growth since 2012. To add insult to injury, the increasingly savvy consumer is shopping online and with mobile technology — rendering the physical store locations less necessary.
In the face of this economic gravity, retailers should reconsider the balance of their physical vs. online assets and find solutions that deliver compelling and differentiated value propositions.
Physical stores can no longer thrive with old strategies in today’s multi-dimensional purchase cycle. In this Executive Insights, L.E.K. suggests five strategic factors to consider:
- Re-think the store model
- Drive tighter connections between stores and digital
- Elevate the in-store brand experience
- Reboot the merchandising process
- Challenge traditional organizational structure
To help drive profitable growth, we urge retailers to completely rethink the store format and proactively shift to a new end-state; one that plays a distinct and relevant role given new consumer behaviors that are here to stay.
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