Top 5 Reasons DTC Retailers Are Expanding into Brick & Mortar Real Estate
Last Updated on April 20, 2023 by Morgan Beard
Curious about the future of brick & mortar real estate?
Wondering why so many successful DTC (direct-to-consumer) retailers are investing in physical stores?
You’ve come to the right place! This trend of DTC shopping back to brick & mortar retail engagement is here to stay. We are going to the top 5 reasons why DTC retailers are expanding brick and mortar real estate space. This real estate strategy has a bright future, especially when combined with a community-centric and convenience-oriented approach.
The Future of Brick & Mortar Retail
While e-commerce has certainly disrupted traditional brick and mortar retail. The future of modern retail is all about brick and mortar real estate because physical stores provide a range of benefits that online shopping can’t match. As a result, successful DTC retailers are expanding into brick and mortar to take advantage of these benefits and provide a more holistic shopping experience for their customers.
Brands like Bonobos, Warby Parker and All birds have paved the way for DTC brands making the jump to brick and mortar. These retailers are recognizable in the trendy neighborhoods of both urban and suburban cities. And, they meticulously built their brand and their customer following through strategic real estate decisions mixed with incredible customer journeys.
Many thought that Covid would kill brick and mortar retail. But it is back and it is here to stay. Why, you may ask? Well, ultimately, humans are social creatures with a desire to connect person-to-person in the spaces they enjoy most. Retailers and restaurateurs are in a unique position to craft their brick and mortar retail real estate strategy in a way that facilitates that fundamental need for human connection.
Top 5 Reasons DTC Retailers are Expanding into Brick and Mortar Real Estate Spaces
1. Customer Experience:
While online shopping is convenient, it lacks the human experience that physical stores offer. Customers want to see, touch, and feel products before making a purchase decision. Brick and mortar stores provide this opportunity, allowing customers to experience products firsthand and make more informed purchasing decisions.
Physical stores provide a personalized shopping experience that online shopping can’t match. When customers visit a brick and mortar store, they can interact with knowledgeable staff, receive recommendations, and receive a level of service that is difficult to replicate online. In a world where remote work is now dominant, people are looking for new way to connect with others. Brick and mortar retail and restaurants offer that personal connection.
3. Omni-channel Distribution:
With the rise of omnichannel retailing, brick and mortar stores are playing an increasingly important role in modern retail. Customers want to be able to seamlessly transition between online and offline shopping, and brick and mortar stores provide an essential touchpoint in this process. Whether it’s a try on in store and have your purchase delivered to your doorstep. Or the convenience factor to returning in-store then continuing to shop.
4. Brand Awareness:
Brick and mortar stores offer a powerful tool for building brand awareness and recognition. A physical store provides a tangible representation of a brand, allowing customers to develop a deeper connection with the company and its products within a given community.
5. Revenue Diversification
DTC retailers are expanding into brick and mortar to diversify their revenue streams. While online sales are certainly important, brick and mortar stores provide an additional source of revenue that can help companies weather economic downturns and other challenges. Our commercial leasing cash flow analysis – Excel template, will help you determine your revenue streams from your brick and mortar real estate decisions.
Ready for Brick and Mortar Retail Expansion?
The future of brick and mortar retail is looking bright, especially for DTC retailers who are expanding their physical store presence. By combining a community-centric and convenience-oriented approach, physical stores offer benefits that online shopping cannot match, including a personalized shopping experience, brand awareness, and revenue diversification. Despite the challenges posed by e-commerce and the COVID-19 pandemic, the human desire for social connection remains strong, making brick and mortar stores an essential touchpoint for modern retail.
As more DTC retailers recognize the value of physical stores, we can expect to see an even greater expansion of brick and mortar retail spaces in the coming years. So if you are a DTC retailer considering expanding into brick and mortar, now is the time to invest in strategic real estate decisions to take advantage of this growing trend. Schedule a time to connect with the team at Occupier. We have helped brands like Bonobos, Marine Layer, Shake Shack and Salad & Go expand their real estate footprint.
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