The past few decades have been problematic for the brick and mortar retail globally. As a result of the rapid rise of e-commerce, hundreds of retailers have had to re-assess their store numbers, store sizes and business models.
Most believed that the pandemic would accelerate that decline. Yet, there were some of us who were firmly of the opinion that the “Revenge spending” phase would happen. No one knows for how long, but the phase is on for now. Consumers have emerged from lockdowns with a new appreciation for physical stores and the concept of look-feel-try before buying, while also enjoying a much needed outing which was missing for long.
In 2023, one should expect developers and mall operators to renovate and re-imagine existing mall spaces. Those who get innovative will reap the benefits.
Globally, ecommerce figures indicate that ecommerce sales are between 15 to 25 percent of hardcore retail sales, depending upon the category as well as the region. The general perception is that this figure is likely to remain at the same levels in 2023. This also explains why the global ecommerce online leaders are trimming their workforce.
Trends and studies indicate that online-only brands would need to seriously create some kind of a physical connect and presence in brick and mortar stores. The days of creating specific, lower priced options purely for online may not be over, but may not generate significant traction.
2023 is likely to see a blending between online and offline retail. However, since almost all global players want to keep pushing the top line numbers, a lot more B2B online activity is likely to happen for two reasons – 1. the millenials and gen Z who are getting into decision making roles wish to have the same B2C experience in their B2B buying processes. 2. The big players will need to find ways to offset their slowing B2C sales.
Hence those B2B online marketplace niche players who can create a head start and a space for themselves may see good times ahead.