Physical stores are holding their own, but you have to know how to market them effectively. This is a point repeatedly emphasized by Claudio Agazzi, CEO and founder of RetailTune, Italy’s leading drive-to-store platform, which has been working for nearly a decade to bridge the gap between digital and physical retail. Today, the company is focusing on GEO (Generative Engine Optimization) and online reputation as key drivers in the age of artificial intelligence.
The E-commerce Paradox and the Underestimated Value of the Physical Store
It took the market longer than expected to realize this, and yet, today, something is changing. "Ten years ago, we thought the potential of drive-to-store would be understood within a few years. Instead, we went in the opposite direction," says the CEO.
The margin in e-commerce is structurally lower than that of physical stores—partly due to returns, which reach 40% in Germany and 20 to 25% in Italy—and yet, many brands continue to invest in the digital channel while neglecting their physical presence.
A figure cited by Agazzi should give pause for thought: where a retail store is present, e-commerce sales for the same brand are significantly higher compared to areas without a physical presence. "It is brand awareness that drives e-commerce, not the other way around," he emphasizes. "We are all aware of the number of brands that started online and are now looking to open physical stores."
Phygital integration: a challenge that is more organizational than cultural
This is a paradox that is only apparent and reveals just how much the physical point of sale remains a strategic asset that is often underestimated. This is where RetailTune’s mission comes in: managing all these digital touchpoints—store locators, Google Business Profile, Apple Maps, local Facebook pages—that guide the consumer from the intent to purchase to the moment they walk into the store. "These ten years in business have allowed us to learn a great deal, to solidify our convictions, and to observe the market’s very slow ability to grasp the opportunity that digital offers to physical retail. It’s a turning point that is still struggling to emerge."
The problem, according to the executive, is not cultural in the broad sense, but organizational. The decision-making chain within brands is often highly fragmented: those in charge of e-commerce naturally push toward the web, not toward the store. The result is a lack of integrated vision that leads to paradoxical situations.
"There are brands with retail locations that you can’t find on their corporate website. And since the vast majority of the public is located near the store, it’s really a shame not to communicate that."
The example given is telling: in a city of 200,000 residents with a shopping center visited by 20,000 people, the other 180,000 don’t know that this store exists if no one tells them. "Informing the other 180,000 would be the right thing to do. Instead, this step is often overlooked."
He adds: "Probably, if I had 400 single-brand stores, I would place them at the top of every possible list, because if 80% of the public is within 5 km of a retail location, the opportunity is enormous."
Replicating the in-store experience through technology
To bridge this gap, RetailTune has developed a series of tools over the years. The goal, explains the manager, is simple to state but complex in its entirety: “We need to be able to replicate as simply as possible what happens when you walk into a physical store.” From the storefront to sales assistance, from the fitting room to size availability. "Technology allows us to serve 100 people at the same time instead of just one at a time. That’s the big difference."
"The key distinction from our competitors," he continues, "lies in our commitment to driving in-store conversion through advanced tools: from stock availability to features such as 'reserve a fitting in-store' or 'notify me when the product is back in stock.' In this regard, the 'back in store' system notifies customers when a sought-after item is back in stock. The internal data is clear: 46% of those contacted actually visit the store, and 50% of them purchase the requested item. It’s a basic, yet equivalent, reproduction of the in-store experience."
Added to this are point-of-sale payment systems for single-brand stores, franchises, and even multi-brand retailers. "Among our most recent tools, we’ve developed the virtual fitting room, which digitally replicates the real-life experience of going to a store, selecting clothes, and trying them on."
Artificial Intelligence and GEO: The New Frontier of Local Search
Naturally, it is in the field of artificial intelligence that RetailTune has invested most heavily in recent years, developing what the industry calls GEO (Generative Engine Optimization). The concept stems from a seemingly simple observation: the way people search has changed radically. "On Google, we used to search by keywords: 'clothing Parma,' 'auto parts Milan,' to give a few examples. With AI, we search in a completely different way." It’s no longer a query, but a conversation. "It’s like talking to someone who listens to you and gives you personalized advice."
To stand out in this new landscape, it’s no longer enough to be indexed: you have to be recommended. And that’s where structured, comprehensive, and reliable data management makes all the difference. "As a company, we’ve built an infrastructure capable of managing all this data—stories, descriptions, content—so that AI knows there’s a store in Parma carrying this type of product and highlights it." The same logic as Google’s applies: “Whoever proves to be the most serious and reliable is rewarded.”
Online reputation: a direct driver of revenue
The second pillar on which RetailTune has focused its development is online reputation. A topic Agazzi addresses without mincing words: "Online reputation, when managed properly, generates revenue." Reviews, he explains, are no longer just an image tool: they are data that directly influence a store’s visibility in AI-generated recommendations. "If the product suits you but the store has a 2.5 rating on Google, it will most likely not be recommended." He adds that he has in mind cases "of sports chains where a particular store stands out in AI recommendations precisely because the reviews reflect service that consumers appreciate."
"Today, we have tools that allow even chains with 1,000 or 2,000 stores to understand in real time where the problems lie. If, out of 100 stores, five of them show an increase in negative reviews related to rude staff, this data represents a loss of revenue—not only from that dissatisfied customer, but from everyone who reads those reviews." The platform collects and analyzes all sources—Google, Trustpilot, Tripadvisor, Meta—and delivers immediate, quantifiable results.
Italian DNA and the future of drive-to-store
RetailTune currently manages approximately 50,000 retail locations across 25 countries, with a portfolio of nearly 100 brands. Its main competitors are international. And this is the point Agazzi is keen to emphasize: "We are a wholly Italian company, with a DNA that involves a great capacity to innovate and adapt to customer needs." A flexibility that, he asserts, represents a real competitive advantage over foreign platforms. "It’s a classic scenario: in Italy, it’s easier to sell German, French, or American products than to promote what works well at home. When there is Italian excellence recognized by many major brands, it would be great if it could also grow with the support of the domestic market."
The future of drive-to-store, according to Agazzi, necessarily involves integration between the physical and digital worlds, between traditional SEO and GEO, and between visibility and reputation. "We may still only be in year zero, after 26 years of digital behind us." But this time, the tools are here.