New research from payments provider Tribe Payments has revealed that two in five (40%) ecommerce businesses in Europe plan to open a physical store in the next three years.
The move to open physical stores is being driven by a number of consumer and payment trends that merchants will need to adapt to in the next five years.
The report, which surveyed bot online and multi-channel merchants across Germany, Lithuania, Spain, the Netherlands and the UK found that the majority of merchants believe there is an increased desire from shoppers for a better customer experience (84%), cross-border shopping (81%), to pay using multiple device types (80%) and for greater personalisation (79%).
In order to meet those demands, merchants will need to overcome a number of challenges. The data found that 50% of respondents say they struggle to compete with larger chains who offer a more innovative customer experience at checkout.
A further 46% of all merchants say regulatory compliance is a challenge and 46% struggle to navigate consumer trends such as BNPL, multicurrency and contactless, the research found.
Just under a third of merchants expect to launch their own branded store cards, mobile apps and increase range of payment options to better compete.
“Reports of the high street’s death may be premature… or even just wrong,” Tribe Payments managing director Alex Reddish said.
“Merchants are responding to consumer demand and want to deliver a multi-channel, highly personalised shopping experience.
“This includes launching their own financial offerings via cards and embedded finance options.
It’s up to acquirers and infrastructure partners to provide the technology and innovation to enable merchants to compete with their rivals, both online and in-store and keep up with consumer demand.”