The next competitive advantage in retail might be the store itself

But while all of that is changing how people shop, something else is happening at the same time: the physical store is not going away.

In fact, it may be becoming more important.

The reason is quite simple. As digital makes shopping faster and easier, the physical store has to offer something that digital cannot.

That could be discovery. It could be convenience. It could be inspiration, service or simply the experience of being there.

This is a shift we are already seeing in retail research. McKinsey’s report “Shopping in the age of AI: Redefining stores for a new era” suggests that store visits may become less frequent as AI takes over more routine shopping tasks, but that the visits consumers do make could become more valuable. The report argues that retailers need to be much clearer about the role each store plays, whether that is convenience, discovery or something in between.

PwC is seeing a similar pattern. Physical stores remain at the heart of shopping, but consumers increasingly expect them to offer some of the convenience and immediacy they get from digital channels.

So maybe the question is no longer whether physical retail has a future. Maybe the better question is: what makes a store worth visiting?

The store needs a reason to exist

For some stores, the answer will be speed.

If a customer already knows what they want, the best possible experience might be a short journey, clear information, products that are actually in stock and an easy checkout.

For other stores, the answer will be very different.

A fashion store might be about inspiration and identity. A flagship store might be about the brand. A grocery store might combine convenience with discovery. A QSR might need to make decisions easier while creating appetite and encouraging the right choices.

McKinsey’s report makes this distinction quite clearly. A growing share of shopping trips can be understood as either convenience-oriented or discovery-oriented, and those two missions require different store experiences.

That feels important because retailers have spent years trying to make their formats more consistent.

Consistency is useful, of course. But there is a point where consistency can make every store feel like it is trying to do the same thing.

The stronger question might be: what should this particular store be best at?

Once that is clear, everything else becomes easier to design around.

Digital is not replacing the store

It is tempting to think that AI will make physical retail less relevant.

It might do the opposite.

As AI gets better at helping people find products, compare prices and make routine purchases, the parts of shopping that happen online become increasingly efficient. McKinsey expects AI to take on more of these tasks over time, potentially changing what consumers use stores for.

That creates an interesting situation.

If you can find a product in seconds, compare ten alternatives instantly and have routine purchases handled automatically, what is the reason to go into a store?

The answer cannot simply be that the same information is available on a screen inside the store.

The physical environment has to provide something more. This is where experience starts to matter.

WGSN’s Future Consumer 2026 work points to growing opportunities around joy, humour and more meaningful forms of engagement. It is a small but important reminder that people do not always shop for purely rational reasons.

Sometimes we want to discover something. Sometimes we want to be inspired. Sometimes we want to spend time somewhere that feels good. And sometimes we simply want the reassurance of seeing and experiencing something for ourselves.

The best stores will connect physical and digital

The future probably isn’t physical versus digital. It is physical and digital working together.

PwC describes this as a need to reinvent physical stores for a digital-first world, while still improving efficiency. Its research suggests consumers increasingly expect digital convenience to carry over into the physical shopping experience.

That could mean knowing whether something is in stock before you arrive.

It could mean personalised information or recommendations.

It could mean content that changes depending on the time, location or context.

It could mean giving staff better access to information so they can help customers more effectively.

Behind all of this are systems that most customers never see: POS, CRM, PIM, DAM, loyalty platforms, data and content management.

The challenge is making all of those pieces work together without making the experience feel complicated.

That is one reason the conversation around digital in-store is moving beyond traditional digital signage. Visual Art’s IXM approach is built around connecting digital touchpoints and the wider technology ecosystem, rather than treating screens as isolated pieces of infrastructure.

The technology should disappear into the experience.

The customer should simply feel that things work.

Experience does not mean entertainment

There is sometimes a tendency to talk about the future store as if every retailer needs to turn its stores into an attraction.

That probably isn’t realistic.

Experience doesn’t have to mean something spectacular. It can be as simple as making the journey easier.

• Making information clearer.

• Helping someone find what they need.

• Showing the right thing at the right moment.

• Creating a little inspiration.

• Making a brand feel more distinctive.

Deloitte’s 2026 retail outlook makes a similar point from another angle. Consumers are becoming more value-conscious, but value is not only about price. Quality, service, checkout, loyalty and employee interactions can all influence how customers perceive a brand.

That means experience and efficiency are not really opposites.

A better experience can sometimes be a more efficient one. And a more efficient store can still feel human and engaging.

The real challenge is getting the balance right.

The store is also becoming a media environment

There is another shift taking place here.

As stores become more connected, they can do more than communicate with customers about products. They can also become valuable media environments.

Retailers can use their owned digital touchpoints to support their own communication and, increasingly, create retail media opportunities for brands and suppliers.

But there is an important line to draw.

The store should not become an advertising channel that happens to sell products.

Retail media works best when it is part of the overall customer experience. Commercial communication, brand storytelling and operational messages all need to work together rather than compete for attention.

That is at the heart of Visual Art’s view of in-store retail media: it should be retailer-owned, customer-first and strategically integrated into the wider digital in-store environment.

Done well, this creates something more valuable than advertising space.

It creates another reason for the store to be relevant.

The competitive advantage may be the physical experience

None of this means that every retailer needs more screens, more technology or more digital features.

In fact, that may be the wrong conclusion.

The opportunity is to start with the customer and work backwards.

Why should people come here? What should they be able to do here that is difficult to do elsewhere? What should they feel? Where can technology genuinely make the experience better? And how can the store support the business at the same time?

That last question matters.

Retailers are operating under pressure from many directions. Consumers are more value-conscious. Costs are under scrutiny. AI is changing the competitive landscape. Deloitte’s research shows that retailers are increasingly focused on productivity and cost control alongside growth.

So the store of the future cannot simply be more impressive.

It needs to be more useful.

More relevant.

More connected.

And ultimately, more valuable.

A new role for the store

For years, retail technology has often been discussed as a way to make stores more digital.

Maybe we should think about it differently.

The goal is not to make the store digital.

The goal is to make the store better.

Sometimes that means removing friction.

Sometimes it means creating discovery.

Sometimes it means telling a stronger brand story.

Sometimes it means turning a screen into a useful service rather than another advertising surface.

And sometimes it means quietly connecting dozens of systems behind the scenes so that the customer experience feels simple.

The retailers who understand this will not necessarily have the most advanced stores.

They will have stores with a clear purpose.

Because in a world where more and more of shopping can happen without ever leaving home, the biggest competitive advantage may be having a very good reason for people to leave it.

The store is not disappearing. It is being redefined.

And the retailers that get that right may find that their physical presence is not a legacy asset at all.

It is one of their greatest advantages.

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