Phygital retail is reshaping how shoppers move between physical stores and online channels, combining sensory, in-person experiences with digital speed and convenience to create one connected journey. As customers demand flexibility, personalization, and consistency, this blended model is quickly becoming the new standard for modern retail.
What is phygital retail?
Phygital retail is the fusion of physical and digital commerce, where shoppers can switch effortlessly between stores, websites, and apps without feeling like they are starting over. A typical phygital journey might begin with discovering a product online, testing it in a store, scanning a QR code for more information, and completing the purchase through an app for home delivery.
The concept builds on omnichannel and unified commerce capabilities, using shared data and technology so pricing, inventory, content, and service feel consistent everywhere. Rather than separating channels, phygital retail treats them as different entry points into the same branded experience, whether the customer is on the sofa, in transit, or standing in a store aisle.
Why physical stores still matter
Even with strong eCommerce growth, consumers are actively returning to physical stores for the human and sensory elements they cannot get online. The EY Future Consumer Index reports that 32% of consumers still want the personal service that in-store shopping provides, 57% want to see, touch, and feel items before they buy them, and 68% seek expert advice on high-value purchases to make more confident decisions.
Even Gen Z, often regarded as the most digitally native generation, has not abandoned stores. Data shows that nearly 52% of Gen Z shoppers are likely to use physical stores to buy new brands or products, compared with 46% via websites, 38.5% via mobile apps, and 24.3% via social media. Phygital retail addresses this behavior by allowing shoppers to enjoy in-store interactions while still utilizing digital tools to research, compare, and check out on their own terms.
How phygital improves the experience
For shoppers, phygital retail upgrades familiar tasks into smoother, more engaging experiences. They can try products in store, then use their phones or in-store screens to access rich content, reviews, recommendations, and alternative options, before completing a fast checkout through mobile payment, self-checkout, or even cashier-free systems. Real-time product availability across online channels and nearby stores reduces the frustration of arriving in person only to find an item out of stock.
For businesses, the greatest value lies in data-driven insights. Every digital touchpoint linked to physical visits—AR try-ons, QR scans, app usage in-store, subscription sign-ups—feeds into a unified view of the customer. This enables more precise personalized recommendations, better-targeted promotions, and refined assortments, which can increase conversion, drive loyalt,y and support smarter inventory and marketing decisions over time.
The tech powering phygital retail
Phygital commerce is being accelerated by a stack of emerging and maturing technologies. AR and VR let customers “try before they buy” in both stores and at home, whether that is testing makeup, outfits or home products via their phones or through smart mirrors and virtual showrooms. IoT devices like smart shelves track stock and customer interaction in real time, while mobile payments and cashier-less checkouts shorten queues and remove friction at the end of the journey.
Mobile apps are becoming the primary bridge between physical and digital. Features such as “store mode” can switch on when a customer walks into a store, offering real-time inventory checks, aisle navigation, personalized deals, scan-and-go functionality, and faster checkout. With AI analyzing data from both environments, retailers can progress toward hyper-personalized journeys, from AI-assisted personal shoppers and targeted content to dynamic in-store experiences that adapt to local demand.
What retailers need to make phygital work
To deliver on the phygital promise, retailers need a strong unified commerce foundation that connects in-store systems and digital platforms. That means integrating POS, eCommerce, inventory, customer data, and in-store touchpoints like kiosks, smart mirrors or connected devices into one real-time environment. This infrastructure must support technologies including AR, VR, IoT, and analytics while keeping experiences consistent and responsive across all channels.
Retailers also need to design for simplicity and trust. Interfaces and tools should be intuitive and non-intrusive so that shoppers of all ages feel comfortable engaging with them, and staff must be trained to guide customers through experiences such as virtual try-ons or mobile checkout. Because phygital strategies rely heavily on collecting and connecting data, strong cybersecurity controls are critical to protect customer information, maintain privacy, and reinforce brand trust.
Real-world phygital retail in action
In luxury menswear, Harry Rosen has extended its signature one-on-one advisory experience into digital by enabling style advisors to build personalized, visually rich wish lists that clients can purchase either in-store or remotely, making shopping more convenient while preserving the human relationship.
Food and beverage giant Pret A Manger has created a phygital loyalty ecosystem with its Pret Perks coffee subscription, where customers use a mobile app to manage their plan, receive tailored offers, and redeem rewards like free daily coffees across participating stores, tightly linking digital engagement with real-world visits. Beauty leader Ulta Beauty has gone further with solutions such as Virtual Beauty Advisor and GLAMLab, which use AR and AI to let shoppers test makeup virtually and receive personalized product suggestions, whether they are at home, on the move, or in store.
