Phygital – a new trend in (e)commerce 

31.07.2023 Katarzyna Zajchowska

Physical and digital – these two words were used to coin the term we’re going to talk about today. Phygital is a new trend in both online and offline trade, and it’s all about having the best of both worlds. In this post, we want to show you what phygital is like in practice and what benefits you can expect when you implement this strategy. 

Although phygital has a lot in common with omnichannel, it’s a bit different thing, as it concentrates mostly on brick-and-mortar stores. Let’s have a closer look at this strategy. 

What is phygital? 

Put shortly, phygital is based on the convergence of both physical and digital worlds with digital technologies seamlessly integrated into the physical sales environment. The goal, obviously, is to offer better, more integrated customer experiences. 

Perhaps you’ve noticed that brick-and-mortar stores are becoming more and more digital. For example, take a look at this picture: 

Source: https://biuroprasowe.eobuwie.pl/245526-kolejny-sklep-eobuwiepl-ze-strefa-modivo-we-wroclawiu 

Would you say it’s a shoe store? Not necessarily, right? It looks more like a computer store or a mobile operator’s point. That’s a real-life example of phygital in action. This store belongs to the Polish shoe retail chain eobuwie.pl. In this company’s stores, the selection of products is made using tablets. Clothes and shoes can be tried on in fitting rooms where pre-selected products are already waiting for the customer. And then, there’s the esize.me device. It’s a scanner that performs 3D scans of customers’ feet, allowing for precise footwear fitting. 

That’s just one example, but phygital experiences may involve the use of multiple digital technologies, such as: 

  • Virtual reality (VR) 
  • Augmented reality (AR) – both VR and AR are great for virtual try-on 
  • Interactive displays 
  • Mobile apps 

Even though we talk about phygital strictly in the context of commerce, this trend has become visible in many other sectors, including education, entertainment, and healthcare. 

Benefits of phygital 

There are at least five good reasons why you ought to consider phygital if you’re running a retail company. Here they are: 

  • Enhanced CX: Phygital can provide customers with more effective and personalized interactions, bridging the gap between physical and digital solutions. This can lead to better customer engagement and, ultimately, increased loyalty. 
  • Convenience and accessibility: Allowing users to start and even finish the whole purchasing process using digital technologies can be a very convenient solution, especially for people who have accessibility problems. It’s not difficult to imagine a device that scans a person in a wheelchair and selects just the right size of the product that a given customer is interested in. All without the need to get out of a wheelchair and in a matter of minutes! 
  • Answering customer needs: According to a recent study conducted by Talkdesk, customers want to have the opportunity to use different channels, and they expect their problems to be solved quickly and accurately. This is precisely what phygital offers! 
Source: https://www.talkdesk.com/resources/reports/the-customer-experience-cx-revolution-in-retail/ 
  • Valuable customer data: Data-driven marketing is a real thing, but collecting data in the offline world has always been tricky. Phygital provides you with the ability to get valuable data insights concerning customer behavior and their choices in offline stores. This insight can be used to improve your marketing campaigns and even the range of products available in your brick-and-mortar stores. 
  • Innovation: Who doesn’t like technological novelties? People like them and are usually eager to see how they work. If you make your physical stores digital, you can expect to see more people visiting your store just to see what’s possible. And when you have their attention, it’s easier to close the deal. 

How to implement phygital 

Of course, there’s no one universal answer to this question, as it all depends on what you actually want to do. Regardless of the answer, all the needed technological solutions are already here, and many of them are actually very popular and, therefore, more affordable. 

Think of interactive displays. These are nothing but large tablets. All you need is good software that will enable your customers to do everything they need to do in order to place an order. Such software should offer: 

  • Browsing products available in a given physical store as well as in other stores 
  • Ordering selected products to be shipped from a different store or a central warehouse 
  • Selecting products in colors and sizes that a given customer wants to try on 
  • Purchasing selected products and paying for them without the need to wait in line 

If, on the other hand, you want to go far and wide with phygital, you’ll need professional technological support. Devices that scan your customers’ physique or foot size and shape are more advanced and frequently custom-made for a given company. 

So, in order to implement phygital in your store, consider these five steps: 

  1. Think of possible digital solutions that can make your customer’s life easier. 
  1. See what technological solutions are already available in your market sector. 
  1. Find a technological partner that will help you implement phygital in your stores from A to Z. 
  1. Begin implementation starting with just one physical store. If everything goes well and customers are happy with your new offer, move on to the next step. 
  1. Introduce similar solutions in other stores in your chain. 

Things to consider 

Mind you, phygital comes with some challenges and questions you need to think about before you start implementing these technological solutions. First off, the more advanced phygital solutions you need, the more technological advancement they will take. You must think about the necessary IT infrastructure and reliable connectivity between different technologies. To some extent, you’ll have to turn your brick-and-mortar stores into small data centers. 

Secondly, you ought to consider privacy and data security. If you want to implement phygital safely and lawfully, you must prioritize privacy protection and data security and adhere to applicable data protection regulations. There must also be adequate security measures. This is crucial as a successful phygital environment is based on customer trust. 

Wrapping up 

Without a doubt, phygital is a big trend in retail. If you operate in this sector, think about digitizing your physical stores. If you do it the right way, you will make your business operate smoothly and more effectively. And this is where our role begins. If you need help with designing and implementing phygital solutions in your store, feel free to reach out! Our team will be happy to talk about your ideas and how they can be implemented! 

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