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The Billboard Effect: 3 ways physical storefronts benefit brands

April 7, 2022

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This new series explores learnings from research conducted by Brookfield Properties’ Consumer Insights team.

Retail stores are highly effective conduits for showcasing brands.

Brick-and-mortar enables consumers to enjoy a multisensory shopping experience and connect with brands and products in real life. But what role do physical stores play in driving brand awareness, purchase consideration, and consumer perceptions? Is there a “billboard effect?” Is brick-and-mortar a brand builder?To find out what the impact might be, Brookfield Properties Consumer Insights surveyed 5,000 people across the country. Respondents were taken on a mall photo tour or were shown websites featuring a series of banner ads for apparel brands with cross-gender appeal. Later, they were asked a series of questions about brand recall, purchase intent, and perceptions.

Here’s what we learned:

1. Physical storefronts drive brand awareness and purchase consideration.

Top-of-mind brand awareness was 45% higher when respondents were shown a physical storefront as compared to seeing the same brand’s online banner ad. Respondents who were shown a physical storefront were 45% more likely to consider purchasing the brand for themselves compared to those who saw an online ad.

2. Physical storefronts elevate brand perceptions.

According to 70% of survey respondents, retail brands that have physical stores in malls were more appealing than online-only brands, and another 73% said brands that open stores are doing so to better serve their customers.

Physical retail also affected respondents’ perceptions about a brand’s financial wellness, especially if that brand was previously online-only. When an online-only brand opens a brick-and-mortar store, 60% agreed that “it means they’re doing well.” And significantly, 80% of survey respondents said they were willing to pay more to purchase apparel from a physical store instead of online.

3. Physical storefronts benefit less-familiar brands and digital natives even more.

For a brand that’s new to the scene, the impact of having a storefront is even greater. Respondents exposed to a storefront for a lower-familiarity brand were 22% more likely to correctly recall seeing it, compared to people who were exposed to an online banner ad. They were also more than three times as likely to consider purchasing that brand compared to those who only saw an online banner ad.

Meanwhile, respondents exposed to a storefront for a digitally native brand were 24% more likely to recall seeing it, compared to those who saw an online ad. More than half remembered the storefront, while only 44% remembered the banner ad.

As customer acquisition rates surge for online-only brands, many have turned to brick-and-mortar as an avenue to fuel growth and build brand identity. But the unexpected cherry on top — according to our study — is that consumers regard physical stores as a means for brands to better serve their customers. And they’re willing to pay more for that privilege.

  • Brand awareness 45% higher when respondents saw a physical storefront
  • Brand perception 70% said brands that have physical storefronts were more appealing
  • Brand purchasing Three times more likely to consider purchasing a less familiar brand if it had a physical storefront

Retailers will benefit as our shopping malls continue to expand into community destinations that include dining, grocery, fitness, and entertainment experiences — giving consumers multiple reasons to visit, multiple ways to spend time with friends and family, and multiple brands to experience. And thanks to the “billboard effect,” the brand consumers shopped in-person — versus the brand they browsed online — will likely be the brand they continue to remember.

Across Brookfield Properties’ portfolio of over 140 shopping centers in 43 states, retail stores are no longer just a point of sale — instead, they are a means for retailers to deliver memorable experiences that build lasting affinity. And as our study showed — they have become shoppable billboards that elevate brand perceptions.

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