Shop­pers still like tra­di­tional stores

Deloitte sur­vey finds many peo­ple still pre­fer brick and mor­tar operations for their Christ­mas sea­son shop­ping

Daily Local News (West Chester, PA) - - FRONT PAGE - By Gary Puleo gpuleo@21st-cen­tu­ry­media.com @Mus­tangMan48 on Twitter

UP­PER ME­RION >> Do you pre­fer to hit the bricks or clang the clicks for your Christ­mas gift shop­ping?

If you’re like many shop­pers, you like it both ways.

In the end you may choose to beef up the world of e-com­merce, but only af­ter you’ve seen, touched and smelled the de­sired mer­chan­dise at a brick-and-mor­tar store.

As the in­ter­net soars to the front of the line as Amer­i­cans’ top hol­i­day shop­ping desti­na­tion, ac­cord­ing to con­sult­ing firm Deloitte’s 31st an­nual sur­vey of con­sumers’ spend­ing plans and trends, shop­pers ex­pect to spend as much of their shop­ping bud­get on­line as at tra­di­tional stores.

Re­gard­less of where sur­vey re­spon­dents said they will be shop­ping, Deloitte dis­cov­ered some pretty op­ti­mistic news for Greater Philadel­phia re­tail­ers in gen­eral when it con­ducted its on­line sur­vey a cou­ple of months ago.

“The tim­ing may have had some­thing to do with the re­sults, and I don’t know if it was be­cause of the elec­tion and pre­elec­tion, but with our orig­i­nal sur­vey peo­ple were a lit­tle on the con­ser­va­tive side and now that the elec­tion is over peo­ple are dig­ging into their pock­et­books a lit­tle more and say­ing they will spend more than they thought they would,” said Bill Park, Deloitte’s Philadel­phia re­tail spe­cial­ist. “With the eco­nomic pre­dic­tions of the orig­i­nal sur­vey I don’t think we saw that, but it’s an in­ter­est­ing dy­namic this year. What’s re­ally amaz­ing is that half the shop­ping will be done on­line this year, and that’s a dra­matic in­crease over where it’s been his­tor­i­cally. It’s amaz­ing to me that if you look back three years ago you would never think we’d come any­where near that. Peo­ple are com­ing into the store, and maybe they don’t buy in the store, but they’ll buy on­line from that re­tailer. The con­ver­gence of dig­i­tal com­merce and brick-and-mor­tar com­merce has re­ally come to a head here, I think.”

Tak­ing ad­van­tage of the cus­tomer’s fond­ness for hav­ing the best of both worlds will be crit­i­cal to tra­di­tional re­tail­ers’ strat­egy in the fu­ture, Park in­di­cated.

“Un­der­stand­ing that be­hav­ior is very im­por­tant for re­tail. Peo­ple still like to go to the store and go shop­ping. They may just be look­ing for ideas and then go back to their home on their com­puter and buy the prod­uct they looked at in the store, but they still like to look at it, they still like to touch it, com­pare it.”

The phys­i­cal ex­pe­ri­ence of shop­ping — the sights, the sounds, the smells of the food

court spe­cial­ties waft­ing through the air — is some­thing the in­ter­net hasn’t yet found a way to du­pli­cate, Park pointed out.

“Peo­ple still like the on­site thrill of shop­ping,” he said, adding that nowhere has that ex­pe­ri­ence been re­fined and de­liv­ered quite as ef­fec­tively as at the re­cently com­pleted King of Prus­sia.

“King of Prus­sia is dif­fer­ent than most malls,” Park said. “When you talk about go­ing out to a re­tailer for an ex­pe­ri­ence, King of Prus­sia of­fers that ex­pe­ri­ence un­like any other mall in this area. And very few malls in the coun­try can of­fer the kind of ex­pe­ri­ence that King of Prus­sia can of­fer. They have the new connection with all the new restau­rants and food, and that’s part of the ex­pe­ri­ence that shop­pers want. You can shop on­line but you can’t eat on­line. So those peo­ple can go out for a cou­ple of hours of so­cial­iz­ing and dining while they’re shop­ping.”

The sur­vey con­firmed that while price is im­por­tant to shop­pers in both for­mats, the phys­i­cal ex­pe­ri­ence is equally im­por­tant to many, Park al­lowed.

“In or­der to en­tice the cus­tomer re­tail­ers have to be pro­vid­ing some­thing more than a good price. While price is im­por­tant to

most, con­sumers are re­ally look­ing for that ex­pe­ri­ence when they go out shop­ping,” he said. “There’s al­ways go­ing to be a very im­por­tant need for brick-and-mor­tar in the re­tail con­cept and those that do it well have fig­ured that out and have blended both al­most seam­lessly, so that the brick-and­mor­tar and on­line ex­pe­ri­ence are a nat­u­ral part of shop­ping that go to­gether and blend very well.”

Park cred­ited the ven­er­a­ble de­part­ment store gi­ant Macy’s with mas­ter­ing the fu­sion of e-com­merce and in-store shop­ping.

“The key is get­ting the two to com­ple­ment each other, and they’ve done a pretty good job of mesh­ing their on­line ex­pe­ri­ence with the store ex­pe­ri­ence, and glob­ally, Ur­ban Out­fit­ters has done a tremen­dous job as well. Stores that bridged the gap be­tween on­line and the store are doing it with things like or­der­ing on­line but pick­ing the item up at the store, and of­fer­ing the same loy­alty re­wards for on­line and store cus­tomers. And they’re also cre­at­ing a seam­less in­ven­tory sys­tem, an omni-chan­nel that or­ga­nizes the in­ven­tory of both on­line and store sys­tems, so they know what they have. Most peo­ple are in­dif­fer­ent as to what sys­tem their mer­chan­dise comes from.”

Although Philadel­phi­aarea con­sumers ex­pected to de­crease their to­tal hol­i­day spend­ing by 19 per­cent, when com­pared to na­tional

re­sponses, Greater Philadel­phia re­spon­dents al­lowed that they would spend slightly more than the na­tional av­er­age ($1,010 com­pared to $998), Park noted.

“Over­all we’re fore­cast­ing that hol­i­day spend­ing will be up about 3 to 4 per­cent,” he said. “Peo­ple are feel­ing pretty good about the economy, but when we ask them specif­i­cally how much will you spend the in­di­vid­u­als we sur­veyed said they were go­ing to spend less this year, par­tic­u­larly in non-gift­ing — things like dec­o­ra­tions and en­ter­tain­ment. Those num­bers are down.”

Ac­cord­ing to the sur­vey, on­line shop­ping is Greater Philadel­phia re­spon­dents’ No. 1 choice for gift buy­ing this hol­i­day sea­son — a con­tin­ued trend, that is only slightly down from last year

The main rea­son they pre­fer to shop elec­tron­i­cally?

To avoid the crowds, long lines and slow check­out ser­vice, Park noted.

But de­spite a de­cline in foot traf­fic, 44 per­cent of shop­ping (47 per­cent na­tion­ally) is still ex­pected to hap­pen at the store. Con­sumers sur­veyed said they will shop lo­cal stores pri­mar­ily to sup­port the lo­cal economy or find one-of-akind gifts.

Clothing and gift cards still lead shop­pers’ wish lists, as they have for years.

“The things that will en­tice peo­ple to go out to a brick-and-mor­tar is to find

some­thing dif­fer­ent and unique, maybe a lo­cal shop for a one of a kind item that you won’t find on­line,” Park said.

With smart­phone own­er­ship in the Greater Philadel­phia area now at 84 per­cent among those sur­veyed (com­pared to 83 per­cent na­tion­ally), there’s of­ten no es­cap­ing the elec­tronic re­in­force­ment that can greatly en­hance gift buy­ing de­ci­sions.

“Mostly likely when con­sumers are in the store they have their phone out and are look­ing at re­views of the prod­uct,” Park said. “That’s an­other im­por­tant way that the in­ter­net and the store ex­pe­ri­ence come to­gether.”

PETE BANNAN-DIG­I­TAL FIRST ME­DIA

A shop­per leaves the Macy’s at Ex­ton Square Mall on Wed­nes­day. The shop­ping ex­pe­ri­ence is still al­lur­ing to many in the age of the in­ter­net.

PETE BANNAN-DIG­I­TAL FIRST ME­DIA

Ex­ton Square Mall is decked out for the Christ­mas shop­ping sea­son.

GARY PULEO — DIG­I­TAL FIRST ME­DIA

A desti­na­tion like King of Prus­sia Mall of­fers a shop­ping ex­pe­ri­ence that can’t be found on the in­ter­net.

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