Did you know that physical stores increase online sales?

In an omnichannel world, having a physical store,
a visible presence for consumers, is essential for online sales too.

The study, “The Halo Effect III: Where the Halo Shines” conducted by ICSC reveals an interesting finding: opening a new physical store leads to an average 37% increase in overall web traffic. The positive halo effect on e-commerce sales varies by category: on average, there is a 6.9% increase in online sales in the area surrounding the store over the following 13-week period. This growth jumps to 13.9% for emerging brands, highlighting the importance of the store and physical shopping for brand awareness. Alongside the growth in online sales, there is also an increase in average basket size, which ranges between 8.1% and 10.6%.

Conversely, the closure of physical stores negatively impacts e-commerce sales, reducing them by 11.5% in the areas surrounding the closures.
The categories recording the biggest losses are home stores at -32.2%, then department stores at -26.1%, and finally clothing stores at -19.4%.

RetailTune's own internal data, spanning multiple sectors, also speaks to the importance of the physical store in the economics of retail businesses and to the correlation between the store network and online sales. RetailTune's heat maps show that most online visits to a brand's website actually come from areas near its stores. In other words, the geographic presence of stores and web visits map onto each other almost perfectly.

Physical stores are an essential component of the omnichannel shopping experience that brands create for their consumers. The value of a physical store goes
beyond simple customer convenience, but it affects communication, website visits and
e-commerce sales, as well as increasing customer loyalty.

“At RetailTune we've always been convinced of this strong connection – says Claudio Agazzi Founder and CEO of RetailTune – and with the goal of adding value for businesses we developed an algorithm that is able to analyze brand strength in the vicinity of a store.
We called it the Brand Consideration Index, an index that tells us, store by store, how strong brand awareness is in a given area, comparing users who have shown interest in the brand online with the resident population. What we discovered is surprisingly intuitive: brand awareness decreases the further you move away from the store”

The BCI also highlights areas that are struggling and those where the brand has reached its maximum level of awareness; leveraging these insights makes it possible to better steer marketing campaigns. What's more, it tells us whether and how brand awareness varies depending on specific communication actions.

RetailTune's mission is to offer businesses every tool they need to understand, measure and drive traffic to their stores, as well as public engagement with a brand touchpoint. It doesn't just make it possible to understand local brand awareness, but also highlights which products the local public prefers and how well each store's stock matches its audience's tastes. In short, RetailTune is the first holistic platform for Drive to Store and Local Digital Marketing.