A not-new but evolving buzzword strategy for a retailer’s survival in the brick-and-mortar world is summed up in the term phygital, a confluence of the words physical and digital. It sounds a lot like the word fidgety – which happens to describe the mindset of some merchants trying to stay ahead of and entice the 2023 savvy shopper.
One of the most successful tactics to lure consumers back inside a store – or at least to a store parking lot – remains the tried and true purchase option to buy online, pick up in store or at the curbside. (Collectively, we’ll call those channels BOPIS.)
Now BOPIS is just shopping
So if it appears that more parking spaces at retail stores are set aside for online shoppers picking up orders, there’s the reason. And whether it’s lingering COVID-19 concerns, a car full of children, winter weather or just a bad hair day, the BOPIS option continues to be a hit with shoppers. BOPIS sales in February rose 81% over a year ago and increased to 10.43% of all online orders, Signifyd’s Ecommerce Pulse data shows.
Overall, ecommerce sales for February were solid and posted a 5% increase from a year ago, boosted by a 36% rise in gift card purchases and a 33% increase in gift card spend, Signifyd data shows.
Of course, Valentine’s Day, Super Bowl parties and Presidents’ Day sales all contributed. UrbanStems, an online flower retailer, had its highest sales number in the lead-up to Valentine’s Day, according to Digital Commerce 360, and increased both its average order volume and conversion rate by 12% year over year around the holiday. And yes, even though it sold out of peonies and a $200-plus glam mixture of orchids and fresh florals, red roses were still the top seller.
Apparel led the way in February online sales
Sales of apparel accessories and footwear in February were down slightly from January, but led all ecommerce verticals with a healthy 17% increase from a year ago and a 12% jump in average order value, according to Signifyd’s data. But the neon sales statistic for February was apparel’s 307% increase in BOPIS purchases, year over year.
- Among the 201 retail chains ranked among the America’s top 1000 by Digital Commerce 360, 72.1% offered BOPIS as of early 2022 and 52.5% offered curbside pickup or drive-up pickup of orders purchased online. Before the pandemic, only 8.9% of the top 1000 retail chains offered curbside pickup of online orders, Digital Commerce 360 says.
- Bot attacks, when fraudulent orders are repeatedly placed automatically, attempted to create havoc across several verticals in February: home goods attacks were up 1,405%; health and beauty items, up 807%; and sporting goods, up 525%, Signifyd data shows.
- The term phygital was coined in 2007 by Chris Weil, co-CEO and founder of Horizon Sports & Experiences, to describe the inseparable connections between the physical and the digital worlds, according to a paper published by R&D Management.
On being phygital
For shoppers, it’s all about convenience. Walmart U.S., president and CEO John Furner, on his “The Huddle” podcast last month, said having great quality and a great price doesn’t always work if the process isn’t convenient or is too time consuming for the customer. “What I’ve heard over the years is that loyalty in retail is just the absence of something better,” Furner said.
For retailers, it’s about connecting. Inside a store, a phygital experience might be a well-placed kiosk set up for a consumer to shop and to actually see, feel, self-pay and leave with a garment. From home, it could be a virtual reality shopping trip in a virtual store; or a digital shopping tour experience with a live sales clerk in a real store; and there’s also the highly successful livestream shopping events. Nordstrom launched a livestream channel in 2021; Walmart started its events a year earlier. China’s livestreaming in 2019 brought in an estimated $63 billion, and the ecommerce livestream market in the U.S. was forecast to top $25 billion in sales by this year, CNBC reported from Coresight Research.
“You can’t just be a brick-and-mortar retailer or an ecommerce presence or online presence, you need to be both, ” John David Rainey, Walmart’s executive vice president and CFO , told host John Furner on “The Huddle” podcast last month. “And those omnichannel retailers are going to be the ones that win.”
True, but consumers have also won. Let’s face it. We’re spoiled.
BOPAC, BOPIS, phygital: There’s no turning back
Buy online, pick up in store or at the curbside wasn’t born because of the pandemic, but it eventually evolved and exploded in demand because of it. There were earlier versions of it – such as stores offering catalog merchandise pickups – but a big jump came in 2016, when BOPIS orders increased 43% from the year before due to tech advances that helped streamline the service for merchants, according to research compiled by Signifyd. By 2018, 77% of shoppers surveyed said they wanted this service, but merchants were slow to incorporate it until the pandemic hit. When non-essential stores were allowed to resume business, but in-store shopping was still limited, more merchants offered BOPAC, buy online, pick up at the curb. The idea stuck.
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