Why product-based retailers should consider a service touchpoint in physical stores



Digitally-native brands are expanding into brick & mortar stores to reach new levels of customer engagement that includes providing services as well as physical goods, subsequently evolving into a hybrid-retail space.

If you're a digitally-native eCommerce brand searching for new ways to branch out and increase sales and customer engagement, consider what many other online retailers are implementing - a phygital store outlet where both goods and services are provided to their consumers in one comprehensive omnichannel hub.

Entrepreneurial online brands are daring to merge both a product-based model (selling products to consumers) with a service-based business model (trading skills and expertise) within a physical hybrid-space in response to new consumer trends and to ultimately better satisfy their customers more-so than their competitors.

Providing both goods and services under one roof can only be a good thing, right? Customers are instore longer, upsell opportunities are rife, and there's a plethora of ideas for really mastering the potential of an omnichannel retail approach that can make your brand become a truly standout hybrid retailer.

What are the advantages of a goods & services retail store?

Product-centric businesses are generally focussed on one thing - sales, and sales lead to growth which increases scale and repeatability. Add a services option for your consumers into the mix and that's where golden opportunities can come to fruition.

Physical stores are still the most authentic retail experience, period.

Whilst the pandemic accelerated the growth and reliance on eCommerce stores, the high-street took a back-seat, only to find that it was sorely missed once shoppers were permitted to visit their beloved high-streets and shopping centres once more.

Physical retail stores are under a lot of pressure due to mitigating factors like the cost-of-living crisis, and their importance has not gone unnoticed by the likes of the UK government who have provided aid with energy caps; ultimately, physical shopping outlets are the most authentic and visible form of retail that consumers cherish. The more goods and service you can provide in one shop, the better.

As we revealed in our latest whitepaper, the majority of consumers still prefer that 'physical experience' you find with high-street shopping.

Also, a physical store exceeds short-term visibility. Shoppers can see the products, which helps them make purchasing decisions in real-time.

Consumer trust is also strengthened when you operate from a physical store they can easily locate and access. Together with an online presence, a physical store will complement your marketing efforts.

Customers make more astute decisions in physical retail outlets

Rarely do clients make ill-fitted purchases in physical stores.

Shoppers purchasing from physical outlets are better positioned to make purchasing decisions. Employees can provide expert guidance to help customers in not only purchasing decisions, but by also having an outlet instore for a service, there's more incentive for consumers to pledge brand loyalty because the aforementioned hypothetical hybrid-service provides the goods they want and services the products they invest in. In the absence of experts, they can potentially end up not making the best choice for themselves and will perhaps source goods and services elsewhere.

Learn what your customers wants & need from your products through a service outlet

Service based retail provides more crucial touchpoints with clients for open and honest discourse, as they receive your service and work with you to learn how to get the most out of it.

It is essentially a real-time customer data goldmine; one that establishes customer retention and also aids product feedback and what a customer wants from a brand, be it product related or the retail experience.

  • Product Quality - The important factor for customer retention is whether the product they bought met their needs. It’s relatively easy to evaluate if the purchase was worthwhile with modern data technology. Creating products that align well with customer needs and interests while also hitting a price point that aligns with market rates is important.

  • Greater personalisation within the customer experience - Products generally can’t be personalised or individualised instore, so why not provide that opportunity?

Hybrid-Stores cultivate business reputation & repeat sales

Product-based businesses generally focus on fundamentally building their brand's reputation, and improve their market position and increase sales. Once a consumer purchases a product they may not need to ever make a similar purchase again. A credible reputation can fuel sales from traditional word-of-mouth advertising or result in a repeat purchase of that product down the line.

Service businesses tend to focus on establishing credibility and developing personal relationships with clients. If a service provider delivers high-quality customer service with a friendly demeanour and provides clarity and results in a timely manner, customers are increasingly likely to call that provider when they need that particular service (or similar) once more.

As businesses evolve and grow it's more than feasible they adapt a product-to-service business model. In this hypothetical, a company has product(s) for sale, but it is also offered as a service to the consumer. It's not entirely new, it's commonly seen within the tech world in the form of service based software - see Adobe, Microsoft Office, etc.

In the same way, a Plant Hire dealer may complete the one-time sale of a mini-digger, but the annual maintenance on the machine is subsequently performed as a service to the same customer.


Whether retailers run a product business or a service business, it is important to carry out research and understand how to best to satisfy their customers.

There's untapped potential for retailers to combine elements of product and service based businesses.

Providing this type of hybrid service can benefit retail growth. Some find that maintaining their relationship with customers by offering a service helps to remain in touch with customer needs and easily pivot when they change. Nurturing this relationship also helps build brand trust, customer retention, and provides lucrative upsell or resell opportunities in the future.