Long live the physical store. Why it matters more than ever.

I believe we are now witnessing a Value Shift in retail. Value never disappears; it moves. When products were scarce, value lay in the range. When information was scarce, value lay in the salesperson. Today, products are available everywhere, and excellent service is becoming increasingly accessible. As a result, value is shifting again, not towards more products or even better service, but towards how a brand makes people feel.

That dynamic is particularly visible today in the competition coming from China. Platforms such as Temu, Shein and AliExpress are putting European retail under serious pressure. Zeeman recently announced the closure of around 150 stores across Europe, citing that intensifying competition directly. Paprika went into administration for the second time this year. Europe is attempting to level the playing field with import tariffs, and Belgium with a parcel tax, but even if those measures have an effect, they do not resolve the underlying problem. What the Chinese platforms reveal above all is how thoroughly commoditised products have become. A retailer offering exactly the same range as dozens of others is no longer competing with the shop around the corner. They're competing with a global platform that operates faster, cheaper and more efficiently.

But the same is gradually happening with service. Retailers are investing heavily in AI, data and automation. Forecasting, stock management, pricing, personalisation and customer service are all getting smarter. What was a differentiating service yesterday becomes a basic expectation tomorrow. Service, too, is slowly becoming a commodity. Not because retailers are getting worse, but because they're all getting better.

That is the paradox of today's retail market. The better products and service become, the more valuable everything becomes that cannot be automated. Not the transaction, but the relationship. Not efficiency, but experience. Not what a retailer sells, but how people feel when they leave.

That is why I believe the physical store is evolving from a sales channel into a retailer's most important brand medium. That may sound abstract, but strong retailers are proving it every day. Nobody visits a Rituals store because shower gel is cheapest there. People walk in because the scent, the calm, the personal advice and the way they're welcomed all feel completely true to the brand. The store doesn't sell products with an experience wrapped around them. The experience has become an essential part of the product itself. A television ad can tell people what Rituals stands for. The store makes them believe it.

We saw the same evolution over the past few years at Wibra in Belgium. The challenge was never to sell products unavailable anywhere else. That has become almost impossible. The challenge was to build a brand that people consciously choose. That meant investing not only in communications, but in everything customers experience the moment they walk through the door. Surprise as a hook, a recognisable atmosphere, the Wibsters community and small moments that stay with customers: these stopped being nice extras and became a strategic part of the brand. The element of positive surprise was not a campaign. It became part of the business model.

That is also why I see the physical store less as a point of sale, and more as a brand medium. Unlike a social media platform, a marketplace or a search engine, it is the one place where a retailer still has complete control over how their brand is experienced. The layout, the music, the scent, the pace, the staff and the attention each person receives: together, they create something no algorithm can replicate. The store is where a brand can not only tell its story, but prove it, day after day.

Artificial intelligence will only accelerate that shift. It will make retailers more efficient, better at forecasting, more personalised in their communications and smarter in how they organise themselves. But that is precisely why human attention becomes more valuable. The role of store staff is shifting, away from executing tasks and towards guiding, advising and building trust. Service is increasingly becoming a hygiene factor. Hospitality is becoming the difference.

That may well be the most important challenge for retailers in the years ahead. Of course they will keep investing in technology, data and AI — they have to. But anyone who believes technology alone is enough to stand out will sooner or later find that advantage copied too. The real question is not how many products a store sells, but how much meaning it creates. Not how much attention a retailer buys, but how many memories they earn.

The future of the physical store will not be determined by its ability to sell products. More and more players do that perfectly well. It will be determined by its ability to make brands tangible, build trust and create experiences people remember. That is the Value Shift in retail.

And perhaps that is the real reason why the physical store is not just surviving but set to matter more than ever.