Online retailers get physical as they respond to customer demand

New research from Tribe Payments reveals that two in five e-commerce businesses in Europe plan to open a physical store in the next three years.

The company surveyed 400 merchants across Germany, Lithuania, Spain, the Netherlands and the UK.

This bricks and mortar move is being driven by a number of consumer and payment trends that companies will need to adapt to in the next five years.

🆕💡Death of the high street? Not so fast.

Did you know 40% of e-commerce merchants are looking to launch physical stores in the next 3 years?

Download Tribe's brand new report - Solving the post-pandemic payments puzzle: How can merchants and acquirers satisfy consumer demand?
— Tribe Payments (@TribePayments) July 19, 2022

The majority of merchants believe there is an increased desire from shoppers for a better customer experience (84%), cross-border shopping (81%), to pay using multiple device types (80%) and for greater personalisation (79%).

To meet these demands, they recognise they must overcome some challenges.

Overall, 50% say that they struggle to compete with larger chains who offer an innovative customer experience at the checkout.

46% state that regulatory compliance is a challenge, 46% struggle to navigate consumer trends such as BNPL, multicurrency and contactless. For 27% a challenge lies with reducing fraud, with these issues being more acute for ecommerce merchants.

34% of merchants across Europe plan to overcome these challenges by offering consumers more ways to pay. Physical stores (13%) are leading the charge on payment methods with e-commerce (10%) players playing catch up.

Just under a third of merchants expect to launch their own branded store cards, mobile apps and increase range of payment options to better compete. Expanding geographically is another tactic being considered (59%), mostly by British (88%) and Spanish (80%) brands.

“Reports of the high street’s death may be premature… or even just wrong,” says Alex Reddish Managing Director of Tribe Payments.

“Merchants are responding to consumer demand and want to deliver a multi-channel, highly personalised shopping experience. This includes launching their own financial offerings via cards and embedded finance options.”

“It’s up to acquirers and infrastructure partners to provide the technology and innovation to enable merchants to compete with their rivals, both online and in-store and keep up with consumer demand.”

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