eCommerce | February 24, 2023

Experience Innovation: The Power of Phygital

What began as a distrust of having to enter your bank or credit card information on a website is now part of our daily lives. Yes, we are talking about online shopping.

What we do not know very well is what was the first online sale in history. The dates are very close, but it is debated whether it was a mushroom pizza from Pizza Hut or a Sting CD in 1994.

But we do know the beginning of e-commerce, and it was more than you might think. In the early 1970s, a few students used their ARPANET accounts, which would become the foundation of what we know today as the Internet, to make a sale. They laid the groundwork for what would become a revolution, not only in commerce but in the way we live.

Offline Revolution

Why are we telling you all this? We know how the online world has evolved and the latest trends and business models that have emerged: eCommerce, Quick Commerce, SocialCommerce and all the options you want... But all these examples are online shopping options. So what happens when it's the offline experience that needs to evolve?

The demand from customers for a more personalized shopping experience with a touch of human interaction, but without losing the speed and convenience of digital environments... this is where the Phygital concept comes in. This concept unifies the digital and physical shopping experience in a single brand strategy that is consistent across all customer touch points, enhancing the physical shopping process with digital tools.

We can see this Phygital concept through some examples such as Amazon's standalone stores or Zara's app where you can extend your shopping process from their digital environment but being in a physical store.

We can also see some examples to understand how this Phygital strategy works in several directions.

IKEA, for example, is extending the online shopping experience with augmented reality technology that allows customers to see how furniture would look in their home before they buy it by simply scanning the room with their phone.

Zara is an example of how the physical experience can be enriched by the online experience. The mirrors they have in their stores, which have digital screens, display information about the products and allow you to try them on virtually and even complete the purchase directly from the mirror.

Sectors such as fashion have made great strides in applying this phygital model in many ways, but ...

what opportunities are there to bring it to another sector?

This is what we had to ask ourselves with one of the projects we have in TheCUBE, in which we are looking to take it to the purchase of food products.

In this project, we are creating a D2C model of hyper convenience so that consumers can get what they need, when they need it. This may sound simple if you don't know everything behind it, but it required us to go out on the street and make an analysis to understand first hand people's routines, their needs, their specific desires, and what specific situations they find themselves in for which they have no solution, or at least none that is more convenient than ours.

The analysis of all this and the search for answers led us to the concept of autonomous stores that are five minutes away from the customer, a mix of e-commerce, delivery, and a 24-hour store that also allows us to create moments of purchase that did not exist before.

But as you may have seen, creating something new generates many hypotheses, drivers to test, and moments of opportunity that we need to test in Quick & Dirty mode to get new questions and answers that allow us to find the true value (or not).

We want to let you know how these tests are going and what we are learning from them. We'll let you know in upcoming blogs!


Radical Innovation Consultant

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