Lululemon trialled the Irish market in Q1 2017 by opening a concession within the Brown Thomas department store. As a result, search traffic from Irish-based customers spiked (Figure 1), and their internet search volumes steadily grew over the coming years. The growth of their online traffic provided confidence to the brand that the market could sustain a prime physical store which opened in December 2021.
This provides two key insights for property owners and advisers:
1. It highlights how growing search volumes can influence physical store network growth.
2. Furthermore, the spike in internet sales volumes around store openings shows that opening a physical store drives online traffic and brand awareness.
This spike in online traffic around store openings is shown more clearly in Figure 2, where the average search volumes of five new stores in the Dublin market spiked close to opening. Whilst this momentum slowly dissipates, brand recognition has been created with the customer who now is able to shop in a manner matching their online/offline shopping preferences.
The International Council of Shopping Centres quantified this relationship highlighting that new store openings resulted in a 27% uplift in online traffic and that the opposite remains true- when physical stores close their online traffic also declines.
This relationship between online search volumes and new retail store openings in Dublin, highlights that neither sales channel acts in a vacuum and shows the importance of well-located physical retail to connect with customers.