E-commerce has been a buzz word for years, with companies like Amazon and eBay becoming household names, and the convenience of home delivery making it easier than ever before to shop on the go.

However, even as South Africans warm up to the idea of online shopping, we are far from being a totally digital retail market.

With just 2% of SA retail sales taking place online, e-commerce businesses are finding that a mix of online and physical retail space is the best strategy. This trend is great news for the commercial property sector and flies in the face of negative predictions about the future of retail space. Let’s find out more.

Creating spaces where customers gather, experience and buy

Traditional shops where customers come in, dodge the advances of overly-zealous salespeople, grab the product they want and head for the till are definitely on the way out – but what will replace them?

  • The variety of choice and ease of delivery that customers now enjoy in first-world markets has tempted many local online retailers to try and replicate that model.
  • However, the South African love of “try before you buy” means that local shoppers are more likely to purchase items that they have touched, held and even used in-store.
  • In addition, there is a social aspect to visiting the mall or your favourite shop that is characteristically South African.
  • It’s not for nothing that we have one of the world’s largest number of malls – we enjoy the experience of shopping, and shopping malls in Africa are very much a social activity.

Increasingly, innovative online retailers such as YuppieChef have found that it pays to be present both online and in the physical retail space.

Their new network of retail stores gives customers the chance to gather in an on-trend setting, try out the latest kitchenware and appliances, and place orders for home delivery right on the spot.

This revolution in retail space will need to become common practice if retailers plan to prosper in the coming decades.

Innovation and disruption aren’t enough – it’s time for revolution

While innovations in retail like smart displays, in-store demonstrations and discounted delivery may have been impressive a decade or two ago, they didn’t prevent disruptors like YuppieChef and UberEats from penetrating the market.

As we enter the 2020s, even disruption isn’t enough – there are simply too many disruptors around. The battle between online vs. physical retailers has evolved, with revolutionary companies combining both mediums to reach a large percentage of the market.

For commercial property owners, this presents a unique opportunity.

  • Ground-floor office space can be repurposed as compact retail spaces and marketed to online retailers.
  • Spaces on the upper floors of buildings can also be converted into micro-retail hubs – consider a snack bar with the option to order online lunch delivery, or a smartphone repair and charging kiosk that offers great mobile deals with free home or office delivery.

If you’d like to repurpose your Cape Town commercial property for the future, we’d like to offer you our expertise in property marketing and management. Contact the Commercial Space team today.