Leadership Lens is a series in which we feature Leap Group leaders discussing industry trends, shifting landscapes, and other topics crucial to brand relevance.
There’s no question that digital continues to dominate the retail landscape: the global e-commerce market is expected to total $4.8 trillion this year, with online sales expected to account for 23% of total retail sales by 2027. Yet at the same time, a surprising counter-trend is emerging: a resurgence of brick-and-mortar retail. Brands like Barnes & Noble are defying expectations by expanding their physical footprint (the bookseller is set to open 60 new stores this year, after opening nearly as many in 2024), while digital-first companies are exploring in-person experiences to build deeper consumer connections.
In this installment of Leadership Lens, we sat down with Alan Gilleo, Co-Founder and CMO, and Walter Harris, VP of Client Services, to discuss the evolving dynamics between online and offline retail, the psychological and cultural factors driving this shift, and how brands can strategically navigate a hybrid future. From hyper-local store curation to digital-first marketing approaches that foster meaningful engagement, they share insights on what it takes to stay relevant in an ever-changing retail environment.
What changes have you observed with your clients in terms of marketing strategy and brand experience as they navigate these shifting trends between brick-and-mortar retail and e-commerce?
Walter: I think what’s interesting—even exciting—about this shift is seeing some established online players flirting with the idea of returning to brick-and-mortar. For decades, the trend has been that once a brand or category moves away from physical retail, they don’t go back. Businesses adjust their model, reshape their marketing, and make difficult operational changes and consumers adapt to that shift. Reversing course seemed counter to good business and consumer preference.
Think about the move to online banking. There was a time when banks opened branches near every new subdivision. Consumers wanted a physical bank nearby so brick and mortar proximity to customers was prioritized. The advent of online banking had the category scrambling to exit physical locations, all driven by consumer behavior. Banks had to reinvent themselves as digital-first entities. People simply stopped visiting branches because smart phones put banks in their back pocket. The proliferation of fintech only accelerated this trend. Fast forward to 2023 and for the first time in a decade, banks in the US opened more stores than they closed. It may be too early to call it a comeback, but you have to wonder if Capital One is onto something by enhancing their branch experience with consumer-driven amenities like cafes and free Wi-Fi.
We all witnessed bookstore giants like Barnes & Noble tumble with the emergence of e-readers and Amazon. The expectation was for large bookstore chains to go the way of Blockbuster. But now, there’s an interesting resurgence in physical media. Vinyl records came back and now have a presence at retail that CDs can only dream of. But don’t count out CDs because Gen Z and teens with old souls are visiting thrift stores to build physical collections. Maybe Barnes & Noble is tapping into a growing desire for tangible experiences and physical collectibles. Remember, bookstores used to offer more than just books—you could get a coffee, browse magazines, read the first few chapters of a book, and even meet other like-minded readers. There was a culture to it, an experience that got lost in the digital transition. It will be interesting to watch and see if Barnes & Noble can reclaim that “cultural, human connectivity” space.
Alan: There’s a psychological aspect to all of this—research shows that humans need tactile experiences to feel grounded and connected. Our generation grew up with a mix of physical and digital experiences, so we never felt a deep disconnect. But younger generations have only ever known a digital world, and now there’s a noticeable shift back toward local, community-driven experiences.
Barnes & Noble seems to be embracing this shift. I was reading about their new strategy—they’re seeing strong sales growth and plan to open 60 new stores. But what’s really interesting is how they’re approaching it. Instead of uniform inventory across all locations, each store manager curates their selection based on local tastes and interests. That makes every store a unique experience, tailored to its community.
It reminds me of UMCU [University of Michigan Credit Union]. Their branches are intentionally designed as community spaces. They have fireplaces and seating areas where people actually hang out and read. It’s not just a place to do banking—it’s a gathering spot. They even let people rent conference rooms for meetings or birthday parties. That kind of hyper-local, experience-driven approach seems to resonate with people.
Walter: It all comes back to creating intentional, engaging experiences that go beyond transactions. That seems to be where retail is headed—whether online or in-person, brands that focus on community and experience will be the ones that succeed.
How do you advise clients strategically on creating a hybrid digital and in-person experience?
Walter: It starts with continuously collecting consumer data and knowing how to mine it for actionable trends and insight. It’s surprising how often even we, as marketers, lose sight of doing consistent research to track where our consumers are and, more importantly, how and where our future consumers want to engage with us.
Consumers were the first indicator that it was time to go digital, and I think they’ll be the ones to signal when it’s time to shift to in-store again. Brands considering a return to brick-and-mortar shouldn’t just rebuild the old model. They have the opportunity to reimagine the store front with a future-forward approach, aligning with how consumers want to engage today and tomorrow. The right answer may not be an either/or. By reading consumer attitudes and moves, we can assess the right combination of digital and in-store experience.
This isn’t something you can force. You have to watch for predictive signs that consumer behaviors and needs are evolving—indications that some needs can’t be fully met online or that in-person interactions could offer an enhanced experience.
There has to be a real reason to turn back to brick-and-mortar because, let’s be honest, it’s far cheaper to operate online. The cost savings of eliminating physical locations are substantial. Moving back to a more expensive, labor- and capital-intensive model has to be justified by data-proven consumer demand or business opportunity.
Until brands see their consumers seeking in-person experiences, maintaining and optimizing digital strategies is the smartest move. Given the current economic landscape, I wouldn’t advise any brand to rush back into brick-and-mortar. But if there’s an inkling of demand, they could start small—maybe test the waters with a pop-up. There’s no shortage of vacant retail spaces right now that could be repurposed for short-term experiments.
Alan: There’s no question—you cannot reduce investment in digital. Every study we’ve done shows that consumers still expect a seamless digital experience. That’s no longer a differentiator; it’s table stakes.
If a brand’s digital experience isn’t strong—whether it’s the app, UI, customer support, or tech capabilities—consumers won’t engage. It used to be a consideration point, but now it’s the baseline. If a brand lacks a solid digital experience, they’re simply not in the running.
But at the same time, consumers are looking for more meaningful interactions with brands. We see this across industries, whether it’s financial services, retail, or even organizations like AKC [American Kennel Club]. People are overwhelmed by constant digital noise, endless options, and faceless transactions. They want positive interactions with the brands they choose to engage with.
That doesn’t mean every brand needs to rush back to brick-and-mortar. But there are ways to create experiences that foster real connections—whether that’s through pop-ups, sponsorships, or community events where brands can have a physical presence. Consumers are far more open to these types of interactions than they were a decade ago.
Look at something like the Oscar Mayer Wienermobile—it’s been touring for the past few years, and people love it. You’d think, “Who cares about a giant hot dog on wheels?” But families bring their kids, people take photos—it’s a brand interaction that sticks.
The key is to be intentional. Some brands benefit from physical activations, while others need to double down on digital. The ones that get it right create experiences that feel meaningful and memorable to consumers.
How do you create that sense of community and deeper connection if your brand is only digital?
Alan: It seems like a no-brainer, but brands must invest in consumer research. Without it, you don’t really know your audience’s motivations, needs, or what makes your brand relevant to them.
We talk about Market Less, Matter More. What does it mean? At Leap Group, our mission is to make brands relevant. That might not sound flashy, but what brand doesn’t want to be relevant to its consumers? And you can only achieve that if you understand what drives them—what they find interesting, what they need.
For example, I follow some brands that text me constantly, and while most people would find that annoying, I keep them because they create a great experience. One restaurant I frequent sends funny texts like, “Haven’t seen you in a while! Are you starving? How much weight did you lose?” It’s playful, it makes me laugh, and when I want a coupon, I have it ready. So, it’s a mix of science—tracking my visits—but also using emotion to connect in a way that isn’t obnoxious.
Walter: If you’re in the digital space, you must reward people for their time. Digital marketing is inherently intrusive. Consumers are online looking for information or entertainment, and digital ads interrupt that experience.
If I’m going to pause a video or stop reading an article to click on an ad and visit your website—you need to make the experience worth my while. Remember, I didn’t seek out your brand. I didn’t plan to make a purchase. I’m choosing to take a chance and engage with your content and website instead of what I originally intended to do. If that experience is frustrating or unrewarding, it’s a waste of my time—and I’ll remember that. Conversely, if you know your audience and have catered your digital experience to their preferences and needs, that relevance will lead to deeper connection. Brands need to sweat every detail of their digital communication and destination to cultivate authentic connection and community.
What are other aspects brands should consider in creating their digital experience?
Alan: The product has to be good. Consumers are exhausted by empty promises. For example, I signed up for Rocket Money after seeing all the ads. I figured, “Okay, I’m probably paying for subscriptions I don’t even know about.” It turned out to be a fantastic experience. Within a week, the app saved me $271 a month on subscriptions I had no idea I was still paying for.
And here’s where they got really smart—after using the service for a bit, they hit me with a message: “Hey, has this app been helpful?” I thought, Yeah, absolutely. Then they said, “Well, we only charge $3 a month to cover our costs, but if you think it’s worth more, would you pay $10?” It’s brilliant. They built such a great product that people want to pay more for it—even though they didn’t have to.
Walter: Right, I think we are honing in on two key factors: One, reward consumers for their time with a great digital communication and destination experience. And two, create a sense of relevance and connection. Now that digital-first is table stakes, brands must work harder to go beyond that and develop connections with their consumers—whether through sponsorships, promotions, or showing up at events that your audience cares about.
The path to deeper connection might not seem obvious at first. Years ago, I worked with a brand selling annuities and to promote them, we partnered with rock concerts. On the surface, annuities and rock & roll don’t seem like a natural fit. But who can afford and benefit most from annuities? Older consumers with disposable income. And what are older, affluent consumers collectively passionate about? The music they grew up with.
The generation who created classic rock in the ‘60s and ‘70s still love rock & roll – and bands and artists from that era are still touring. So, we aligned this brand with concert tours. This gave annuities and the digital brand a presence at shows and an opportunity to engage in-person with consumers (through activities, trivia and photo-ops) and made financial planning feel like a natural part of their lifestyle.
People were surprised to see us there—but in a good way. It was an unexpected connection that enhanced their concert experience. And because they felt like they got something out of it, they were more than willing to give us a few minutes of their time and sign up for more information.
Alan: That’s exactly where an agency can add value. It’s not just about running ads—it’s about finding those unique connections and understanding your consumers at a deeper level. Most brands spend so much on advertising just to convince consumers that they’re barely worth the price. Rocket Money did the opposite—they let the experience prove the value first, and then asked, “Hey, do you think this is worth more?” That’s a completely different mindset.
It all comes down to creating a great customer experience—not just a marketing experience. Yes, advertising, marketing, and media spend are important. But if the product experience isn’t great, all the ad dollars in the world won’t make a difference. Brands that get this right—whether digital-only or hybrid—are the ones that truly connect with consumers in a meaningful way.
