Why brands should adopt omnichannel retail
Today’s shopper is not an easy person to please – we check out several shopping sites before we buy and if we don’t find what we need, we move on swiftly. In fact, nearly 75% (source: HBR) of shoppers say they use multiple channels to compare prices, hunt for discounts, or shop online for a product they see in-store.
People’s changing shopping behavior is forcing brands to react- but the reaction is often limited to simply adding more digital retail channels. Without planning for an integrated retail experience, companies end up creating inconsistent and unconnected experiences in separate commerce channels that might even end up working against each other to convert a sale.
Instead, brands must think in terms of an approach that provides a unified shopping experience across all channels. What they need is an omnichannel retail strategy that allows customers to engage anywhere with your brand and shop however they want.
For the modern retail brand, executing an omnichannel customer engagement strategy is the key to retaining customers and growing the business.Indeed, Harvard Business Review research shows that brands which follow an omnichannel customer engagement strategy are able to retain on average 89% of their customers and earn 30% higher value over the customer lifetime.
So let’s understand what omnichannel retail is and how sales can skyrocket by implementing it.
What is omnichannel retail?
Omnichannel retailing is an approach that provides the customer with an integrated customer experience.An omnichannel approach acknowledges that shoppers today expect to quickly move between mobile, social and offline channels and even actually use multiple channels simultaneously. These days, folks expect to buy online and pick up at a store, exchange products quickly, earn discounts and rewards instantly, get delivery updates, and talk to customer support 24/7.
Omnichannel retail capabilities include but are not limited to providing detailed product options and information, price matching, flexible delivery options (click-and-collect, ship from stores etc.) and omnichannel customer support.
Google defines omnichannel retail as the way to “ensure marketing strategies are geared toward enabling customers to convert on any channel.”The key is to be where your customer will be and convert the engagement into sales as efficiently as possible.
This ability to deliver a hassle free shopping experience which takes into account the needs and context of the customer, lies at the heart of a successful omnichannel retail experience.
Omnichannel vs. Multichannel
The essential difference in evolving from multichannel to omnichannel retail is the depth of the integration. All omnichannel experiences will make use of multiple retailing channels, but not all multichannel experiences can be said to be omnichannel.
Omnichannel takes a customer first approach so that all of the brands communications and actions work together and empower the customer to shop based on their preferences. To identify if you are truly enabling omnichannel retail, ask if your business has the following capabilities:
- Can customers place an order online and pick up the purchase from your store?
- Are shoppers able to click on an item in a social media post/email/text message and add it to their mobile shopping list?
- Can your sales staff look up a customer’s profile and transaction details in-store for them?
- Can you run loyalty programs across channels, ensuring updated rewards for all your customer’s transactions across channels?
- Do shoppers have access to a single profile where they can see all past purchases regardless if they were made online, in store or through a third party?
In a multichannel retail brand, the consumer has multiple shopping options but they aren’t necessarily synchronized. Whereas in an omnichannel retail experience, the channels are connected so a customer can move between them and get the same buying experience.
How do companies develop an omnichannel retail strategy?
The key to executing an omnichannel retail strategy is to put the customer at the center of the strategy. Brands should gear their operations to reach where the customers shop and then work towards integrating the experience across all these channels.
Companies ready to begin their omnichannel journey should focus on acquiring these four broad capabilities to make the most of an omnichannel retail strategy:
A single version of the truth
Getting rid of corporate silos to create a single real-time view of your inventory, across channels, catalogs, systems & fulfilment locations is the basis on which to develop an omnichannel strategy. Brands looking to expand their channel network across the physical and digital world will need a unified inventory and customer view to ensure fulfilment from any location. This allows companies to easily create new online sales channels on any number of ecommerce marketplaces and integrate them with their physical store network as well.
Smarter audience segmentation based on buyer personas
Omnichannel Customer Data Management means sourcing and integrating data from multiple customer touch points like web, POS systems, contact centers, apps and social channels.This customer data can be used to create rich buyer personas with detailed information about customer preferences, purchasing behavior, preferred modes of communication etc.Specific buyer personas can be targeted via specific campaigns with personalized offers and messages with much more impactful outcomes.
By segmenting your audience based on buyer personas, you can derive insights on what products and content will interest each persona, and avoid frustrating large parts of your customer base with irrelevant communications.
Align campaigns and communications to customer journeys
For omnichannel retail marketing to work,focus on accurately tracking and mapping each unique buyer journey.Brands should have the ability to trace their customer journey through accurate attribution of each touch point and interaction with your brand. Understanding these customer journeys will tell you which channels to prioritize and design appropriate marketing strategies.
A customer feels valued when they receive communications that understand their context and needs, making them more likely to shop more with your brand. Aligning campaigns to customer journeys enables you to personalize the message for your audience at each stage of the journey, and boost engagement and conversions.
Invest in customer support
The primary reason for losing a customer sale is poor customer service. Especially with millennials, you could lose up to 50% of your shoppers due to poor customer service. Make sure your customer support staff have all the required customer data and channel data when they interact with a customer.
No matter the retail channel, customers should get the same delightful experience whenever they interact with your brand.
Benefits of omnichannel retail
Better personalization: Combining customer identity with insights enables you to customize promos and loyalty offers and personalize the shopping experience. When all your channels are connected, every consumer touch point will strengthen your relationship with customers and reinforce your competitive advantage to retain shoppers.
Retail Efficiency: Omnichannel retailers can handle order fulfilment much better with inventory solutions that help savere sources on staffing and warehousing.Shopper Productivity is improved can quickly make their purchase from the channel they prefer.
Increased Sales and Higher Margins: Research from IDC Retail and Digital Commerce 360 shows that omnichannel retail delivers:
- 9.5% year-over-year increase in annual revenue
- 7.5% year-over-year decrease in cost per customer contact
- 15–35% increase in average transaction size
- 5–10% increase in loyal customers’ profitability
Higher Brand Value: Omni-channel retailing experiences delight customers and improve your brand profile by making the whole buying experience seamless.
Leading brands like Starbucks and Disney have tapped the significant value to be gained from providing digital channels to traditional store shoppers, and fusing the shopping experience across channels.
There are very few technology solutions that deliver the depth of capabilities needed to implement omnichannel, but getting omnichannel retail right not only differentiates retailers from their rivals, it skyrockets your retail sales.
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