• Newsletter Phygital Retail


Monthly Tonic - Issue 12

The search for the optimum retail experience continues to evolve for all brands. In recent years omnichannel and experiential retail have been two of the buzzwords circulating amongst retailers and retail designers alike. Today, ‘phygital’ experiences are what forward-thinking retailers are aspiring to achieve.

Hi there,

Many of our clients are asking for our support in understanding ‘Phygital’ retail and how this can be used to better meet today’s customer expectations. As a result, we’ve been busy defining a 5-year digital strategy for one client, we’ve helped roll out mobile POS for another, and many retailers are looking to build in extra shopper convenience through express checkout systems. Below are some articles we’ve been discussing in the studio that have contributed to our current thinking around ‘Phygital’ retail.

Phygital; Engagement beyond operations
We’re seeing a lot of innovation in how technology is used in retail. CBRE's report highlights some of the ways this is impacting not just store operations but also how it can be used to encourage engagement in retail experiences. We’re also seeing some cities with business districts being re-purposed to offer more visitor entertainment and escape experiences. An article in Australia's The Age notes that despite there being fewer workers, people are returning to business areas to ‘play’, providing opportunities for retail brands to expand their reach through engaging, branded phygital moments.

Retail is now channel agnostic
We see that many shoppers have not returned to their pre-pandemic shopping preferences. These consumer insights gathered by Google illustrate how shopping behaviour in the UK has evolved over the last three years. The blurring of lines between online and offline is greatly contributing to the demand for phygital retail experiences.

The customer device is here to stay, make sure you take advantage
The University of Bath's research found that when people are shopping with their mobile phones in hand, they’re distracted. No longer on autopilot, they spend more money, up to 40% more! This BBC report on smart contact lenses helps us imagine the evolution of the customer device from mobile phone to something far more integrated.

The changing nature of the physical store
Santiago Gallino, a professor from Wharton Business School, discusses his research which found that online-first brands opening zero-inventory stores are seeing higher sales, with customers returning less and also developing a stronger affiliation with the brand. This interview with Seth Godin and Cate Trotter outlines some key insights into the changing nature of shopping and consumers. Above all, these insights highlight the need for authentic connections between brand and consumer through phygital experiences. This shift towards phygital experiences and integration with online retail was predicted by Doug Stevens as far back as 2013.

The Metaverse
Whilst we are talking about phygital experiences in retail, the conversation surrounding the Metaverse continues to accelerate. Inevitably, these conversations will merge sooner rather than later. Kilowott’s article is a great starting point to understanding what the metaverse is and how it might influence retail. McKinsey provides some useful data insights into the current state and future expectations of the metaverse, and they project immersive shopping will become the most popular digital activity over the next five years.

If you find these articles helpful, please sign up here for our Phygital Retail report. In this report, we’ll share guiding principles for delivering digital experiences in retail. In the meantime, feel free to get in touch if you’d like to discuss further.

Kind regards

In Quinine's ‘Monthly Tonic' newsletters, we share the key articles, reports and research studies that are driving the conversations we are having here in the studio. Each newsletter is based around a single theme that extends beyond retail to explore broader social and cultural influences shaping the changing world around us. We share a range of insights, perspectives and points of view that are positively impacting the direction we are heading and the discussions we are having with our clients. The following newsletter was shared with all our friends, clients and Quinine community members. If you would like to receive our next issue, please sign up here!