Tuesday, December 23, 2014

Omnichannel retailing

Modern day customers are driving the revolution in retailing to be highly accessible and customer-centric. The access to new technologies, the demand for convenience and the vast variety of online resources allows customers to use multiple sources of information during their shopping experience. Such information comes from online review sites, social media, retail websites, blogs and even in-store marketing displays.

Mentioned in a previous post, omnichannel retailing is one of key strategies retailers should adopt or plan to adopt in the coming year. Not just a marginal evolution of existing thinking, omnichannel is a seamless approach to the consumer experience through multi channels. With the user in mind, omnichannel is about true continuity of the shopping experience. It extends beyond the brand’s spectrum of consistent mobile design with its responsive web designs as well as in-store design. Omni supports all channels with fully integrated support to deliver a continuous and consistent customer experience. Customer data from a channel is captured and stored, so there is no need for the customer to repeat information.  Omnichannel optimizes shoppers’ experience with an enhanced cross channel experience.
Often compared to cross-channel or multi-channel, omnichannel stands out with its continuity in operations. In multi-channel, products are sold through many different channels – online web stores, social media, catalogs, mobile phones and brick and mortar stores. However, if there is a defect in a product bought online, the process for obtaining a refund or exchange might not be allowed in-store but instead be shipped back to the warehouse. Also, the shopping experience online and offline could differ a lot. Many retailers do not allow customers to complete their purchases as a guest online, with a tedious checkout process of multiple mandatory forms from signing up to billing address. However, the same retailer might have a faster checkout process in stores which gives customers a better shopping experience.
The first step in embracing omnichannel retailing for click-and-bricks retailers is to go mobile. Optimize your web store to be mobile friendly and ensure that purchases and enquiries can be done through the mobile platform. Link inventories between the different channels and place an SKU code to allow customers to access products easily. To enhance a seamless approach, link all online channels back to the brick and mortar store. Allow online or mobile purchases to be picked up in stores and allow customers to reserve products for a limited amount of time online and make payment in stores. Also, provide retail staff to have mobile devices to assist customers with product information, enable checkout processes and arrange out of stock products to be shipped to their doorstep.
Next, implement solutions that help stimulate the same shopping experience across all channels. Retailers that have limited “touch” options such as beauty, healthcare and packaged F&B retailers would benefit from a simpler online shopping experience. Fashion retailers on the other hand would do better when customers are able to feel, fit and visualize the product personally. To counter the physical barrier, fashion retailers need to approach online channels in a creative way. Some examples for doing so could be sampling, free 30-day returns or even virtual dressing room technologies. One great example of a successful fashion retailer is Nordstrom, which is determined to be the world’s top omnichannel retailer. With heavy investments made into their online channels, Nordstrom is at the forefront of e-commerce and omnichannel and has made it possible for customers to purchase products featured on Instagram. The visual merchandising team in Nordstrom also places popular Pinterest products more prominently on their sales floor.
Thirdly, implement a personal shopping experience from online to offline. Obtain and store customer details such as billing information, member identification and purchase history. This would allow retailers to recommend similar products to increase sales or in case of out-of-stock products. With new mobile tracking solutions, retailers can suggest products on customer’s mobile phones as they enter the shop. This helps in displaying products to customers which might be hidden with the limited floor space. In addition, provide retail staff with mobile devices to speed up the checkout process. With stored billing information, enable in-store products to be purchased using this stored data to reduce waiting time.

Success in omnichannel retailing requires 3 core elements – consistency, data and analytics. The demand for a consistent and seamless experience is high but not complex. Customers are clearly focused on convenience and efficiency with 71% of customers expect to view in-store inventory online, while 50% expect to buy online and pick up in-store. However, retailers struggle to implement omnichannel initiatives online or meet customer expectations in offline channels, with 94% stating significant hurdles toward integrating omnichannel. To counter such challenges, retailers should take a step-by-step process and start small. For example, some retailers are setting minimum safety stock quantities at the SKU level before promising certain products online. Additionally, retailers need to be open in adopting new technologies that would aid them in operational efficiency and business intelligence. The rapid evolutions of new retail technologies that tap on big data to analyse and provide business insights have helped many retailers to gain business success and high revenue. More than just a mere fad of the moment, omnichannel could very well be the future of retailing.