Phygital. A word that doesn’t quite roll off the tongue, but nonetheless, it's a buzzword rapidly making its way into every marketing and customer experience discussion.
But, what is phygital really? Is it only about live shopping? Or is it more?
A phygital strategy aims to combine the best of physical and digital. It’s not necessarily going all physical nor is it opting for a digital-only experience.
If you’ve been fidgeting to understand phygital, we’ll help make it clear and ways to get the most out of your phygital strategy.
Here's the agenda.
- What is Phygital?
- Phygital is more common than you think
- Phygital in the automotive industry
- Phygital in the retail industry
- Phygital in the real-estate industry
- Phygital in the banking industry
- Don't wait to go phygital
What is Phygital?
Phygital bridges the gap between the physical world and the digital. The objective is to bring the best parts of the physical customer experience into the digital realm and vice versa.
For a phygital strategy to be successful, it needs to be I.C.E: Instant, Connected, and Engaging.
Instant
The main need that phygital answers to is that craving of right-here-right-now. Customers operate in a world where instant gratification and immediate service are minimum standards.
45% of customers are ready to switch brands if a company doesn’t anticipate their needs, let alone answer to their needs when presented.
Connected
Going phygital means connecting on multiple fronts.
Firstly, the user is directly connected to the company. All interactions should feel like a two-way conversation. The customer should feel connected to what’s being offered and feel like the brand empathises with him or her.
Secondly, as a brand, your online presence and store presence should be connected. Quality should not be lost when a customer goes to your store after having an engaging experience on your website.
63% of shopping occasions begin online, so make sure you make your presence count.
Thirdly, as the term insinuates, phygital needs to connect the physical aspect of shopping with the digital.
In some cases, this can be executed through virtual reality, or via a one-to-one video shopping opportunity with an in-store brand representative.
To successfully implement phygital qualities to your business, you’ll need to make sure connection and immersion are at the core.
Engaging
If a customer doesn’t notice or see the use of your phygital attempts, it may be failing in the engaging and interactive department.
It’s important to make your phygital moments convenient and fun.
For this to have the best results, you’ll want to make sure to offer phygital moments on your website to the right visitor, and phygital moments in your store that will grab attention.
Phygital is more common than you think
You may be thinking that the idea of phygital is futuristic or reserved for those with access to exclusive technology, but that’s not the case.
If you look around the world today, you’ll see phygital elements in everyday places.
Examples of common phygital strategies in practice
Phygital examples in physical spaces
Picture McDonald’s. You walk into the popular fast-food restaurant, and what’s intercepting your path to the checkout counter? Digital kiosks.
This is a perfect example of phygital in action. Even though a customer is in a physical store, some would still prefer the convenience and speed of digital at the same.
For this type of customer, it’s more practical to be able to see photos of all of the food options and make an order instantly with a few clicks of the screen on the digital kiosk.
Another phygital example that you may see in person is the use of QR codes. Again, this is an example of delivering additional information and opportunities instantly through a digital platform.
Customers can enjoy the ambience of a restaurant or a store, but to make the buying (or upselling) process even more smooth, businesses may stick QR codes around their brick-and-mortar shops to encourage visitors to continue their experience digitally.
Phygital examples in online spaces
One of the best online phygital examples can be found in the rising trend of live video shopping.
Commerce giants in China ignited this trend, but by now you may have even seen some of your favourite large retailers launching live shopping streams recently, like Nordstrom, Aldo, or your local shopping mall.
This gives consumers the opportunity to feel like they themselves are trying products and browsing a physical store, while they only need to click a button to purchase the products they like.
If you decide to get started with live video, make sure to avoid the biggest live video shopping mistakes. But more about live shopping to follow.
Phygital Examples in Different Industries
To get a better understanding of how phygital can look in different industries, let’s zoom in on instances where it can thrive.
Phygital in the automotive industry
If you’re wanting to get phygital with your car dealership, it starts with optimising your website for unique interactions. This is also the key to lead generation for online car sales,
With the right type of interactions, you don’t even have to worry about redesigning your whole website, you can bring phygital to your online car dealership with the help of live one-to-one video calls.
Buyers want a tangible experience when shopping for a car. The closest you can get to this, without the customer actually being in the store, is with video.
Here’s why live video enables a smooth car buying experience. The buyer can:
- Talk face-to-face with a car expert, which builds trust
- View the car in real-time to diminish any qualms about appearance
- Ask questions without waiting minutes or days for an answer
All of this the buyer can do in the comfort of their own home thanks to phygital components.
Phygital in the retail industry
As mentioned earlier, the biggest players in the retail industry have taken hold of live video shopping for peak season and beyond.
Live video shopping brings you the heart of shopping in-store straight to your desk or couch.
In most cases, you can interact with a live host and ask questions, you get to see specific products in action, and feel the buzz of shopping digitally.
In this case, the complete physical experience is digitally transmitted to you.
Consumers seem to be loving this type of phygital experience. For example, fashion retailer, Aldo reported a 308% engagement rate after a live stream shopping event in 2021.
Phygital in the real-estate industry
It’s also very possible to go phygital for real estate firms also. The possibilities could be on your own company’s website or on different housing portals that host your properties.
A great way to go phygital is to offer a one-to-one video call option to website visitors who are showing high interest in a property.
Once you have the right target on a video call, you’re able to build trust and give more details about the property unit they’re interested in, just like you would in person.
According to a US study, 51% of home buyers first found their home on the internet. It's crucial to make the first website interaction count.
Phygital in the banking industry
The banking industry may just be the industry that has got phygital figured out.
If you walk into a brick-and-mortar bank location, almost all will have a digital kiosk (or ATM) to help you find out information about your account digitally.
Sometimes customers would prefer to visit the location but still interact with the digital channels. This gives the customer the option that if they do have a concern, an actual human is close to assist if needed.
Most banks also have great web services that cater to online interactions from beginning to end of the buying and customer service process.
The only way they could be a little more phygital, is again if banks would include the option for the video call so that way customers can feel safe speaking to a real representative.
Physical Retail Going Phygital in 2023:
How Brands are Embracing the Future of Shopping
The COVID-19 pandemic has accelerated the shift towards online shopping, with e-commerce sales reaching an all-time high in 2020. However, despite the rise of online shopping, physical retail is not going away anytime soon. In fact, many brands are now looking to blend the physical and digital shopping experiences in a trend known as "phygital" retail.
What is Phygital Retail?
Phygital retail refers to the integration of physical and digital elements in the shopping experience. This can include the use of technology such as virtual reality (VR), augmented reality (AR), and artificial intelligence (AI) in physical stores to enhance the shopping experience. It can also involve the use of online platforms and social media to drive traffic to physical stores, or the integration of online and offline payment options.
Why is Phygital Retail the Future of Shopping?
Consumers today expect a seamless and convenient shopping experience, whether they are shopping online or in-store. Phygital retail allows brands to meet these expectations by offering a blend of physical and digital options that cater to different consumer preferences.
For example, a customer may prefer to shop online for the convenience and variety of options, but also appreciate the opportunity to try on clothes in-store or receive personalized recommendations from a sales associate. Phygital retail allows brands to offer both options, providing a more personalized and convenient shopping experience for the customer.
Additionally, phygital retail allows brands to collect data on customer preferences and behavior, which can be used to improve the shopping experience and drive sales.
Examples of Phygital Retail in Action
Many leading brands are already embracing phygital retail, with some innovative examples including:
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Nike's "House of Innovation" flagship store in New York City, which features a "digital stadium" where customers can try on and customize virtual sneakers using AR, and a "speed shop" that offers a curated selection of popular items that can be purchased using self-checkout kiosks.
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Sephora's "Beauty TIP Workshop" in San Francisco, which combines a physical store with a virtual reality beauty lab where customers can try on virtual makeup and receive personalized recommendations from beauty advisors.
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Amazon's "Amazon Go" stores, which offer a completely cashier-less shopping experience using AI and computer vision technology to track purchases and charge customers' accounts automatically.
What Does the Future Hold for Phygital Retail?
As technology continues to advance and consumer preferences evolve, it is likely that we will see even more brands embracing phygital retail in the coming years. In 2023, we can expect to see more physical stores featuring innovative technology such as VR and AR to enhance the shopping experience, as well as more seamless integration between online and offline platforms.
Overall, phygital retail represents the future of shopping, as it allows brands to meet the evolving needs and expectations of consumers by offering a convenient and personalized shopping experience that combines the best of both the physical and digital worlds.
Don’t wait to go phygital
If you haven’t quite yet set your sights on making your business phygital, you may be falling behind your competition rapidly.
Phygital encompasses the best of both physical and digital worlds, so if you’re only focusing on one, it is time to intertwine both.
Want to dive deeper into the phygital world? Download our Live Commerce Guide to learn more about the booming live commerce industry which exemplifies phygital perfectly!