Phygital in Practice and Examples of Utilization in Retail

Read more
Phygital in Practice and Examples of Utilization in Retail

Phygital is a hybrid sales model that combines the best features of online and offline commerce. The name comes from the English words “physical” and “digital,” which perfectly encapsulates the essence of this trend.

Tip: Our previous article explains phygital in more detail. Check it out!

In a phygital store, the boundaries between virtual and real space blur. Digital technologies integrate with traditional sales formats, creating a cohesive and engaging shopping experience for the customer. What can we talk about here?

Examples of phygital implementation in stores:

ROPO (Research Online, Purchase Offline) and reverse ROPO 

Thanks to phygital solutions, a customer can check on a tablet in a showroom what products are available online, order them, and pick them up in-store.

Detailed product information through QR codes

By scanning a product’s QR code, a customer can access its technical specifications, user reviews, instructional videos, etc. – a massive convenience during offline shopping!

Virtual fitting rooms

Unique mirrors or cameras allow virtual trying-on of clothes, facilitating the selection of the right size and style. This is a popular solution in many industries: optical (trying on glasses has never been easier!), cosmetics (widespread lipstick colour testing), and even decorative or interior design (nothing stops you from using VR to see if particular doors fit your kitchen).

Mobile payments 

This seemingly inconspicuous element of phygital is crucial: customers can pay for purchases using their phones without needing a traditional payment card.

Does Phygital Affect Our Lives?

The answer is simple: yes! As we read in the Future Mind report:

  • The digitization of our lives is a fact, and the degree of immersion in the phygital reality varies depending on our age, professional requirements, and lifestyle.
  • The average knowledge of phygital solutions stands at 63%, with about 31% of respondents using them.
  • The most common phygital solutions in Poland are self-service checkouts (98%), smartwatches/smartbands (97%), payments via phone/watch (96%), remote control of home devices (87%), and digital public transport tickets (85%).

We can draw several interesting conclusions from the abovementioned report, including the answer to the question.

What is the most popular Phygital solution on the market?

Poles love self-service checkouts! At least they know about them and willingly use them. Compared to other phygital solutions, these (present in the country for several years now) are particularly popular. Most respondents (98%) are familiar with this solution, and 93% have used it at least once (Emilia Adamek, Future Minds report).

Phygital in Retail Industry. How Does it Work?

How can you implement phygital strategies in the retail industry? Here are some tips!

Personalized shopping

Phygital works great for personalization. Ensure:

  • Product recommendations based on purchase history and customer preferences (e.g., store mobile app).
  • Virtual fitting rooms that allow customers to see how a product looks on them (e.g., AR/VR technology).

Interactive experiences

  • Touch screens in stores that allow customers to learn about products and compare prices are among the more exciting solutions.
  • Equally reasonable solutions in larger stores are interactive maps.

Streamlined payment process

  • Ensure mobile payments via smartphone or smartwatch.
  • Nowadays, store self-service checkouts are essential – especially in grocery stores.

Inventory management

  • Part of phygital in retail includes RFID systems that track inventory and inform about shortages.
  • An exciting option is reserving a product online before visiting the store.
  • Customers appreciate access to real-time product information (e.g., availability, size, colour).

Examples of companies using phygital in retail

Lidl has been increasingly introducing self-service checkouts on a larger scale—in many stores, they account for more than half of the active checkouts. An additional advantage is the possibility of cash payments, which customers can sometimes (though only sometimes!) rely on.

Pay by card? At Empik, you can use a self-service checkout or get assistance from a person with a mobile tablet who will take your payment. Another pleasant phygital element is listening to albums in stores or seeing live product availability.

IKEA allows you to create your dream wardrobes or kitchens online, which you can assemble with an expert in-store. Great options also include shopping lists that you can make both on paper and in the app.

Euro RTV AGD offers the possibility of ordering a product online and picking it up in a physical store even within 2 hours.

Benefits of phygital for the retail industry

When it comes to the benefits of implementing phygital strategies in your business, increasing sales is undoubtedly worth mentioning, as you can achieve this by improving customer satisfaction and strengthening their loyalty. Also, remember the improvement in inventory management. 

As a result, your company will become more competitive and appreciated by industry professionals and customers who enjoy using your services.

Of course, there are no benefits without challenges! Phygital requires investment in new technologies, integration of offline and online systems, and everything related to data protection. Remember: Brick-and-mortar stores are still a vital sales channel!

Phygital in the retail industry. Three conclusions to finish

  1. Phygital is a trend that will become increasingly visible in the retail industry.
  2. Companies that want to be competitive must start implementing phygital solutions.
  3. Take inspiration from the best and act!

Do you need a reliable IT services provider?

Then, you are in the right place. We would be happy to talk to you about your next project.