Ever since the first online sale in 1994—a CD of Sting’s Ten Summoner’s Tales —retail has been on a digital journey. The COVID-19 pandemic accelerated the growth of online shopping and left many wondering: is brick-and-mortar retail still relevant? Despite the digital wave, physical retail stores continue to dominate total retail sales globally.

In this blog, we explore how brick-and-mortar and e-commerce compare—and why the real winners are those embracing both in a unified, omnichannel strategy.

Retail by the Numbers (2025)

• 72% of global retail sales still happen in-store (Retail Dive, 2023)
• E-commerce sales are projected to exceed $6.3 trillion globally in 2025 (Statista, 2024)
• 59% of consumers prefer to touch and feel products before purchasing (PwC, 2024)
• Omnichannel shoppers have a 30% higher lifetime value than single-channel customers (Harvard Business Review, 2023)

The Strengths of E-commerce

E-commerce, or electronic commerce, refers to the buying and selling of goods and services over the internet (IBM, n.d.). It has become essential for retailers looking to scale beyond borders.

Benefits:

• Convenience: Shop anytime, from anywhere
• Scalability: Reach global markets without physical presence
• Limitless Shelf Space: List extensive inventories, especially for dropshipping or niche items
• Personalisation via AI & Analytics: Deliver customised promotions and recommendations using CRM and AI tools

Drawbacks of E-commerce

While powerful, e-commerce has several operational and experiential limitations:

• High Return Rates: E-commerce returns average 30%, and go as high as 60% in fashion (Invesp, n.d.; Beumer Group, 2023)
• Lack of Sensory Experience: Customers can’t touch or try before buying
• Rising Customer Acquisition Costs: Increased digital ad spending is impacting margins
• Fulfilment Challenges: Delivery delays, packaging issues, and logistics complexity

The Strengths of Brick-and-Mortar Retail

Brick-and-mortar refers to traditional physical stores. Far from obsolete, they continue to provide experiences that online channels can’t replicate.

Benefits:

• Lower Return Rates: Just 8.89% compared to e-commerce’s 30%+ (Invesp, n.d.)
• Experiential Shopping: Physical engagement builds trust and loyalty
• Impulse Buys: Store displays and ambiance influence purchases
• Instant Fulfilment: Walk out with your purchase

Drawbacks of Brick-and-Mortar Retail

Despite their strengths, physical stores also face challenges:

• Higher Overhead Costs: Rent, utilities, and staffing add up
• Geographic Limitations: Reach is constrained to nearby foot traffic
• Limited Inventory: Shelf space caps product diversity
• Inconsistent Service: Staff experience can vary across locations
• Harder Data Collection: Less real-time customer insights without tech integration

Where the Magic Happens: Omnichannel Retail

Smart retailers are not choosing between the two. Instead, they’re embracing an omnichannel approach that combines the best of both worlds.

Innovation Examples:

• Canada Goose’s “The Journey”: A store where nothing is sold onsite. Customers walk through a snow-filled room, try on parkas, then purchase online—blending experience with inventory flexibility (Walton College, 2024).
• Click & Collect (BOPIS): Customers shop online, pick up in-store, combining convenience and immediacy
• Stores as Fulfilment Hubs: Physical stores act as mini-warehouses to reduce last-mile delivery time
• In-store Technology: Allegory AI by Integrated Retail allows QR code scanning for product info, side-by-side comparisons, and AR try-ons

Customer Journey Comparison

Phase	E-commerce	Brick-and-Mortar	Omnichannel
Discovery	Ads, search, email	Window shopping	Unified marketing
Decision	Reviews, AI, filters	Staff help, demo	Online info + in-person support
Purchase	Website checkout	Cashier/POS	Cross-channel checkout
Fulfilment	Shipping	Immediate pickup	BOPIS or ship-from-store
Returns	Courier process	In-store exchanges	Both options offered

Executive Action Plan: 5 Questions to Ask

1. Are we delivering a consistent experience across all channels?
2. Can we use our stores as fulfilment centres to reduce delivery times?
3. Are high return rates impacting profitability?
4. Are we maximising the value of our customer data?
5. Are we leveraging technology to enhance the in-store experience?

Final Verdict: The Power of Integration

Brick-and-mortar retail is not dying. E-commerce is not perfect. The most successful retailers will be those that integrate both to create a seamless, data-rich, and experiential shopping journey.

Ready to Modernise Your Retail Strategy?

Don’t choose between e-commerce and physical stores. Integrate them.

At Integrated Retail, we bring over 20 years of domain expertise in the retail industry, having partnered with world-renowned brands to deploy solutions that drive results. Our team understands both the operational realities and strategic opportunities facing modern retail chains.

✉️ Book a consultation with our experts to discover how we can tailor an integrated retail strategy for your business.

✉️ Contact us at connect@integratedretail.com to get started.

References

Beumer Group. (2023). Handling the challenges of returns in the e-commerce fashion industry. Retrieved July 22, 2025, from https://www.beumergroup.com/knowledge/wd/handling-the-challenges-of-returns-in-the-e-commerce-fashion-industry/

Colliers. (2024). Singapore retail: Staying relevant in the age of e-commerce. Retrieved from https://www.colliers.com/download-article?itemId=c41d112c-bfd6-4fdd-9c5d-ee5ec3746d7f

IBM. (n.d.). What is e-commerce? Retrieved July 22, 2025, from https://www.ibm.com/think/topics/ecommerce

Invesp. (n.d.). E-commerce product return rate statistics. Retrieved July 22, 2025, from https://www.invespcro.com/blog/ecommerce-product-return-rate-statistics/

PwC. (2024). Global consumer insights survey. Retrieved July 22, 2025, from https://www.pwc.com/gx/en/industries/consumer-markets/consumer-insights-survey.html

Retail Dive. (2023, May 14). The retail disruption era is over. Now what? Retrieved from https://www.retaildive.com/news/retail-brick-and-mortar-ecommerce-disruption-era-over/747361/

Sekel. (2023). E-commerce vs brick-and-mortar: Which is winning? Retrieved from https://sekel.tech/blog/e-commerce-vs-brick-and-mortar-which-is-winning

Statista. (2024). Retail e-commerce sales worldwide from 2014 to 2027. Retrieved July 22, 2025, from https://www.statista.com/statistics/379046/worldwide-retail-e-commerce-sales/

Walton College. (2024). The endless aisle evolution: Future of retail shopping. Sam M. Walton College of Business. Retrieved July 22, 2025, from https://walton.uark.edu/insights/posts/the-endless-aisle-evolution-future-of-retail-shopping.php

Weinberger, A. (2014, April 10). What was the first thing ever sold online? Smithsonian Magazine. Retrieved from https://www.smithsonianmag.com/smart-news/what-was-first-thing-sold-internet-180957414/