It makes a lot of sense to distribute digitally now days - but there should be some savings to be had. The digital and physical retail editions are the same price most of the time so someone is subsidizing the packaging and shipping of retail versions.
Back in the day - retail versions had a whole heap of reference material, keyboard mapping, companion stories, posters or stuff that was fun. I do miss that.
These days you buy Wolfenstein: New Order (last one I bought from a store) and you get a disk with half the game on it. WTF? Load the DVD and it installs half and then you have to download 25GB to finish it. Makes no sense at all.
The irony is that my internet was so slow I specifically chose to buy a retail so I didn't have to spend two days downloading it from Steam..
Long story short - aside from the recent moves away from Optical drives for a lot of enthusiasts, games are too big for DVDs - do you remember when Wing Commander III came on about seven CD-Roms? or games with like 11 floppy discs? Bluray drives aren't really that popular.
A USB would be a great option, especially for regions with relatively slow internet speeds.