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How is e-commerce affecting physical retail real estate?

E-commerce has significantly reshaped consumer behavior in India, impacting physical retail real estate in both disruptive and complementary ways. On one hand, online shopping challenges traditional stores by drawing footfall away from outlets lacking engaging in-store experiences or brand differentiation. Non-essential categories like books or electronics face intense competition from e-commerce platforms.

Conversely, many retailers have adopted omnichannel strategies that blend online convenience with offline engagement. Initiatives like click-and-collect counters or digital payment solutions are now integral to shopping malls and high-street outlets. This "phygital" approach helps physical stores adapt to evolving consumer expectations while leveraging their brand presence.

E-commerce giants like Amazon and Flipkart are also establishing branded offline outlets or experience centers to boost loyalty. These trends indicate that physical retail isn’t obsolete but is transforming into experience-driven destinations focusing on entertainment, food & beverage services, and personalized shopping. Thus, e-commerce coexists with offline formats through hybrid models rather than fully replacing brick-and-mortar spaces.

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