Offline retail stores see a surge in footfall but low brand loyalty: Capillary

Offline retail stores see a surge in footfall but low brand loyalty: Capillary
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Offline retail is doing considerably well in the age of ecommerce,  says a report from Bengaluru based software as a service solutions provider Capillary Technologies.

For its report, The 2019 Festive Shopping, the company looked at the trends in fashion and apparel, footwear and jewellery. Data was collected from 62,000 consumers in India. 

This Diwali season, shoppers showed a preference for ethnic fashion as compared to western brands. However, consumer conversions were low, according to a statement from the company. 

In one of the case studies in the report, an ethnic fashion brand saw an increase of  77% in footfalls, but the number of people who actually made a purchase decreased by 12%.

In another case, a popular French fashion brand noticed a 35% dip in footfall just two weeks before Diwali, the brand did not make a significant number of sales either.

The jewellery segment witnessed a 3% decrease in the number of shoppers as compared to 2018. However, there was a 12% increase in sales value from 2018 to 2019.

Meanwhile, the footwear industry witnessed a rise of 4% while fashion saw an increase in spending of  7%.

The trend also showed that while the bill value increased, the number of items being purchased decreased, probably pointing towards better-informed customers who know their specific needs.

Consumer loyalty, however, remains a major concern for offline retail stores. The jewellery industry saw a sharp 28% drop in loyalty. Fashion and footwear only saw an increase of 3% in consumer loyalty.

 “The 2019 Festive Shopping study breaks the supposition that offline businesses are reporting lesser traffic in the age of e-commerce,” said Aneesh Reddy, CEO and Co-Founder, Capillary Technologies. 

Retail brands need to strengthen their consumer loyalty programmes and focus on customer retention, Reddy added. 

Other research reports have also shown that consumers are increasingly seeing shopping as an experience rather than a necessity, which might explain why offline stores are registering a rise in footfall but not enough conversions. Retailers are now tapping into omnichannel models to boost conversion rates.