The Beauty of Omnichannel Retailing
Posted on by gocretail
Omnichannel retailing is the practice of providing a fully-featured, unified retail experience across multiple channels. Traditionally, those channels include bricks and mortar retail and your online store, but other offerings such as a smartphone app or a print catalogue could still be considered a part of Omnichannel retailing.
Omnichannel retailing is the future of retail as we know it. According to the Interactive Advertising Bureau, around 55% of consumers use their mobile devices to access product reviews or pricing data while they’re in a bricks-and-mortar store. Around half of all consumers do product research online and then go on to order the product via a retailer’s website, then pick up the product in store. These actions may seem like second nature today, but they are things that would not have even been possible five years ago.
The proliferation of smart phones and online shopping was initially viewed by many as a threat to the high street but smart retailers see these developments as an opportunity to provide a better, more personalised shopping experience for their customers whilst also increasing their revenues and margins.
Omnichannel Retailing in Action
The beauty of Omnichannel retailing is that it makes life easy for consumers, and therefore removes barriers that might otherwise put them off making a purchase. Here are some of the ways an Omnichannel strategy can improve the customer experience.
- Click and Collect: This is Omnichannel retailing in its purest form. It allows consumers to search for a store that has their desired product in stock, complete the purchase online, then pick up the product from the store from a sales assistant who is expecting them and has their order ready.
- Reward Cards: Many loyalty schemes allow you to earn and spend points both in-store and online, or even allow customers to earn points for shopping at multiple companies all owned by the same parent company.
- Real-time Information: To give consumers the best shopping experience available, it’s important to offer up-to-date information. Click and collect would be useless if consumers were told that they could collect an item that was out of stock at their nearest store.
- Omnichannel Marketing: Many brands collect information about consumer habits both on-and-offline, and use that to provide relevant special offers and discounts, both via direct mail and email. By collating all this information from one Omnichannel system, retailers get a better understanding of their best customers to help guide their business decisions.
One good example of a retailer that uses Omnichannel retailing extensively is iconic British pharmacy chain, Boots. The Boots brand includes bricks and mortar stores, a website, and a paper catalogue. Consumers can place orders online or in-store and can have products delivered to their door or shipped to a local store so that they can pick them up. No matter which channel the customer users when they shop, they earn reward points. Boots tracks each reward card holder’s purchases, and gives consumers personalised vouchers, which they can spend on any channel they choose. For the 2011/2012 financial year, Boots posted an 18% increase in revenue. Not all of that can be attributed to Omnichannel retailing, but it is hard to deny that it played an important role.
In 2012, Boots placed 7th in the Web credible Omnichannel retail store charts, ahead of several major retailers, including Next. The top three Omnichannel retailers were Burberry, Waterstones and Debenhams, brands who offer cross-platform, easy to use websites in addition to their bricks and mortar stores.
Many other brands have adopted similar strategies, with some, going one step further and offering free WiFi in their stores to encourage users to look up products and perform price comparisons while they’re in the store. These retailers understand that making it easy for consumers to do their due diligence will make them more likely to complete their transactions.
The Benefits of Omnichannel Retailing
Omnichannel retailing benefits both retailers and consumers. Retailers benefit because offering their retail experience through several channels allows them to reach more customers, grow their brand, and collect more valuable data about their customers. Omnichannel allows retailers to offer a cohesive brand experience across their sales channels, turning loyal customers into brand ambassadors.
According to research published by IDC, Omnichannel customers spend 30% more than single-channel customers. The main issue that retailers have is tracking and understanding consumers across multiple channels, but that is something that is being fixed thanks to increasingly sophisticated cross-channel retail management solutions and analytics tools. Offering an Omnichannel service makes it easy to engage with customers, and increases the exposure potential for each customer, thereby improving their perception of your brand.
Customers no longer see separate channels individually but instead view just one whole brand. They expect information to flow freely between channels and to receive a consistent brand experience at every touch point. Omnichannel solutions are the only way to meet these changing expectations and continue to delight customers now and into the future.
Meanwhile, consumers benefit in several ways. Firstly, they can shop whenever and wherever they wish, even starting their product research on one device, and completing their transaction on a completely different platform. Secondly, access to up-to-the-minute price comparison data, consumer reviews and even apps to compare prices means that they can easily check to see whether they’re getting the best deal. Today’s consumer has more power than ever before when it comes to finding new products, researching the best deals, and engaging with their favourite retailers.
The Future of Retail
Technology has evolved to the point that most people no longer think of the Internet or mobile as a novelty. Shopping on their PC, tablet or mobile device is second nature, and consumers are equally comfortable with bricks and mortar stores, mail order, click and collect and digital distribution. A few years ago, many consumers were wary of shopping at an online store, even if the store carried the same branding as their favourite bricks and mortar retailer, but this is no-longer the case.
Bricks and mortar companies are constantly striving to re-invent the shopping experience, and online companies are opening up an increasing number of sub-brands, app based stores, rewards schemes and other ways to shop with them. The next big revolution will involve improving analytics to make full use of the Big Data that Omnichannel customers provide us with. The brands that will succeed going forward are the ones that understand technology and the benefits it provides for both retailers and consumers. If you can get rid of the processes and equipment that inhibit the use of technology in your business, you will be in a better position to implement the technology you need to truly embrace Omnichannel retailing and the opportunities it provides.