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Physical Retail Stores Make a Comeback in Europe Amid Growing E-commerce Competition

European retailers are expanding physical stores to boost online sales, counteracting rising competition from e-commerce giants like Shein. Data shows that online sales can increase by 10–20% within 20 minutes of proximity to a store, making physical locations a valuable part of omnichannel strategies. Companies like Decathlon and Inditex are creating engaging, interactive spaces that bridge digital and physical shopping, drawing in customers.

Physical Retail’s Role in Supporting Digital Sales

Retail spaces across Europe are expected to grow by 2.7% by 2028. Decathlon added 80 stores this year and introduced hubs for equipment rentals, repairs, and in-store product testing. For example, Decathlon’s Rome store offers free ping-pong, enhancing the shopping experience. Italy’s Cisalfa plans to open or refurbish 10 stores, underscoring the importance of face-to-face customer interaction that e-commerce lacks. Meanwhile, Zalando, a digital-first retailer, has expanded its physical presence to 15 German locations, catering to the demand for omnichannel experiences.

Retailers See Physical Stores as a Multi-Channel Driver

Studies indicate that brick-and-mortar locations drive multi-channel engagement, with closures impacting revenue both online and offline. Inditex offers group-friendly fitting rooms with touchscreens for size requests, while Zalando combats fast-fashion competitors like Shein with pop-up stores across Europe.

Why Shoppers are Returning to Physical Stores

Consumers are gravitating back to in-person shopping, enjoying instant gratification and convenience. RBC analysts note that some people prefer the reliability and immediacy of physical stores, especially for last-minute purchases.

EU Moderates Emissions While Sustaining Economic Momentum

The European Union witnessed a modest decline in greenhouse gas emissions in the second quarter of 2025, as reported by Eurostat. Emissions across the EU registered at 772 million tonnes of CO₂-equivalents, marking a 0.4 percent reduction from 775 million tonnes in the same period of 2024. Concurrently, the EU’s gross domestic product rose by 1.3 percent, reinforcing the ongoing decoupling between economic growth and environmental impact.

Sector-By-Sector Performance

Within the broader statistics on emissions by economic activity, the energy sector—specifically electricity, gas, steam, and air conditioning supply—experienced the most significant drop, declining by 2.9 percent. In comparison, the manufacturing sector and transportation and storage both achieved a 0.4 percent reduction. However, household emissions bucked the trend, increasing by 1.0 percent over the same period.

National Highlights And Notable Exceptions

Among EU member states, 12 reported a reduction in emissions, while 14 saw increases, and Estonia’s figures remained static. Notably, Slovenia, the Netherlands, and Finland recorded the most pronounced declines at 8.6 percent, 5.9 percent, and 4.2 percent respectively. Of the 12 countries reducing emissions, three—Finland, Germany, and Luxembourg—also experienced a contraction in GDP growth.

Dual Achievement: Environmental And Economic Goals

In an encouraging development, nine member states, including Cyprus, managed to lower their emissions while maintaining economic expansion. This dual achievement—reducing environmental impact while fostering economic activity—is a trend that has increasingly influenced EU climate policies. Other nations that successfully balanced these outcomes include Austria, Denmark, France, Italy, the Netherlands, Romania, Slovenia, and Sweden.

Conclusion

As the EU continues to navigate its climate commitments, these quarterly insights underscore a gradual yet significant shift toward balancing emissions reductions with robust economic growth. The evolving landscape highlights the critical need for sustainable strategies that not only mitigate environmental risks but also invigorate economic resilience.

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