We explore the effect of physical store presence on purchase decisions in omnichannel retailing. We use geolocated customer-level data from a major shoe retailer and study the differential role of physical proximity (number of stores, distance to closest store), as well as service quality (assortment breadth and service level). We find that, while proximity generally increases sales, the service quality provided by the physical store network increases offline sales but decreases online sales.

We examine transaction-level data of an Italian furniture retailer to study channel-specific effects of fulfillment lead time on demand. We find that the showroom channel makes consumers less sensitive to fulfillment lead time than both online and catalog channels. Niche products and experience goods further accentuate the difference of lead time sensitivity between showroom and non-physical channels. Our study highlights the previously-ignored lead time aspect of the physical store’s value.

An omnichannel grocery retailer can fulfill incoming orders either from the dark store or from a brick-and-mortar store. Customers are offered only those products available in the DS and the B&M store. We develop a new business model that offers customers all products available in the DS or the B&M store. We develop a new decision-making mechanism to determine the fulfilment location for each order. We computationally compare our dynamic policies with the omnisciently optimal solution.