The future may hold far fewer and radically redesigned stores, analysts say.
Former web-only retailer Pixmania plans to open five to 15 stores each year.
European e-retailer Pixmania—a subsidiary of the Dixons Retail Group—has opened 20 bricks-and-mortar stores in European cities including Paris, Marseille, Madrid, and Barcelona in the past two years and plans to transform its pick-up points for online orders in other markets into stores over the next few years.
The France-based group says its 26 European web sites attract 30 million unique visitors a month and its annual sales for both the web and stores total around 900 million euros (US $1.1 billion).
The group’s co-founder and vice president, Jean-Emile Rosenblum, says by opening more stores, the company is targeting the roughly 80% of European shoppers who continue to buy products that Pixmania sells—including electronics, high-tech, furniture, fashion, DYI and jewelry—in stores.
“Today the web accounts for 5% of total European furniture sales, 10% of television sales and 20% of camera sales,” Rosenblum says.
He expects Pixmania’s bricks-and-mortar stores to represent 50% of the company’s sales within five years—up from 25% today—as the company plans to open as many as 15 new stores a year.
He says Pixmania’s Swedish affiliate, webhallen.com, already does 50% of its sales online and 50% in store.
“To satisfy consumers’ purchasing habits, you have to look further than Internet and seriously think about opening stores,” Rosenblum says. He says he wants his company to reach consumers everywhere they shop—online, in stores and via mobile devices.
Rosenblum adds that the relationship between online and offline sales is increasingly important. “The preparation for purchasing often takes place online,” he says. Depending on the product category, he estimates that consumers conduct between 20% and 80% of their research before buying on the web. However, he says there will always be a segment of consumers that want to buy in stores because they want to see and feel a product and take it home with them immediately.
“In our 1,076-square-foot store in Barcelona customers can see a thousand of our products,” Rosenblum says. “Online, they have access to 1.4 million products, and can also order a product that was not available in store and have it delivered either at home or at the store.”
Rosenblum says the web has huge potential to generate in-store sales.
He says 18% of Dixon’s group sales in the past year stemmed from its PC World and Curry’s e-commerce sites, and 50% of those goods were collected in stores. He adds that many consumers purchase more goods while picking up the items they order online. “The web brings a lot of customers into the stores—and 80% of those shoppers end up buying something else when they come to collect,” Rosenblum says.
Offering a range of delivery choices is helping Dixons gain market share online and offline, he adds.
Rosenblum believes U.K. retailers, including his own Dixons as well as John Lewis, Argos and Tesco, are excelling at mixing different retailing channels.