Reshaping retail as shoppers return to the high street

By Brian Flesk, Head of Retail at Hitachi Capital Consumer Finance

As retailers await the reopening of non-essential stores on 12 April, many will be planning how to make the most of footfall returning to our high streets and shopping centres. Whilst the pandemic will undoubtedly have a lasting impact on consumer habits – with the rise of e-commerce clearly here to stay – there remain elements of bricks and mortar retail that cannot be experienced through a screen.

Despite the rise in prominence of AR and VR adopted by e-commerce retailers, the experiential factor in physical stores to test a mattress or try on an expensive piece of jewellery has been missing for consumers over much of the past 12 months. Maximising the potential of physical stores as destination shopping experiences will revitalise bricks and mortar and support retail on the road to recovery.

The post-pandemic consumer wants the ease of shopping from their sofa, as well the security of an in-store purchase. Retailers must be geared up for a frictionless customer journey across all purchase channels in-store and online. Ensuring you have the right tools in place to meet that demand is vital, which is where point of sale finance (POS) comes in.

Meeting the surge in demand

As lockdown lifts, we can expect to see pent-up demand amongst shoppers returning to the high street. When restrictions were lifted for the first-time last June, many of Hitachi Capital’s 3,200 retail partners reported an increase in sales of around 20% on the same period in 2019.

The challenge for retailers over the coming months is to convert increased consumer demand into sales within a highly competitive market. Offering POS finance solutions for high value items with simple and straight-forward payment terms can play a huge role in converting these browsers into buyers; 55% of customers cite finance solutions as a key reason for completing a purchase. Moreover, Hitachi Capital data also reveals 43% of customers spend more on big ticket items when finance is available at the point of purchase.

An omnichannel future

The pandemic has put e-commerce at the forefront of retail. Consumers have explored new categories, brands, and retailers for the first time online and confidence has grown in making digital purchases.

The benefit of funding solutions is clear for those building an online presence: Hitachi Capital reported a 63% year-on-year increase in the volume of business on e-commerce platforms after retailers integrated with our mobile optimised POS finance platform.

Yet there are certain parts of bricks and mortar that cannot be easily replicated, which is where an effective omnichannel approach becomes more important. Retailers must make the purchase experience as frictionless as possible, in store and online, across any device or platform a customer may wish to use. This approach will attract more consumers, increase conversions and spend, and provide a great customer experience.

The pandemic has massively altered the retail sector, accelerating the speed of digital transformation. The escalation in e-commerce platforms has been matched by a growth in the number of retailers integrating flexible POS solutions into their customer journey. These retailers are in a strong position to drive purchasing decisions and sales and make the most of consumer demand post-lockdown.

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