‘Omnichannel’- the buzzword on everyone’s lips.
But what is omnichannel? For those who aren’t familiar with the term, here’s a quick definition:
Retailers utilize multiple channels to sell their products and services both online and in-store. These can include physical stores, social media, websites, emails and mobile apps. An omnichannel strategy connects these channels to each other, ensuring a cohesive customer experience however customers choose to buy.
Of course, being able to move between the digital channels seamlessly is critical for a smooth-sailing customer experience, but why is it so important to execute an omnichannel strategy in-store?
Well, as Eric Hazan of McKinsey explains “We are entering the world of “phygital”—physical and digital at the same time, where there is not a physical world or digital world in retail, but rather a completely connected one”.
A report from Criteo further explains this, explaining that the consumer journey is complex and often involves multiple channels:
“Consumers may start on one device and finish on another. They may browse an ad on their social media stream and purchase in-store. They may be in a store and buy online.”
When a customer enters a physical store, they still expect the store teams to have an understanding of any digital interactions they have had with the company, such as transactions, email queries, or mobile loyalty points. They might also decide to browse in store but purchase online, in which case they would expect the store experience to be cohesive with the online experience.
According to CX today, 9 out of 10 consumers want an omnichannel experience and 40% of customers say that they won’t do business with companies if they can’t use their preferred channels. Therefore, omnichannel is essential, not a nice to have.
Today, everyone has different preferences for how they shop. The pandemic fueled a 50% increase in omnichannel shopping across the U.S. in 2020, as stores scrambled to accommodate shoppers who were spending more time at home and expected reduced-contact services like curbside pickup and click and collect. 67% of customers use multiple channels to complete a single transaction. By maximizing the channels that can be used to shop, a retailer widens the net to reach more potential customers who have different shopping preferences.
Customers will be more satisfied with a shopping experience if they can use their preferred channel to shop, easily access any information they might need from any channel (such as email, FAQs on a website, or asking an employee in-store), and return or exchange a product using whichever method is most convenient for them! Overall, omnichannel provides a consistent customer experience across every channel by ensuring that all factors including promotions, marketing, customer support and services are aligned.
Omnichannel integrates all of a retailer’s sales data, offering clearer visibility into what works and what doesn’t for each sales channel. For example, a seasonal promotion might have been less successful in terms of mobile app sales but more successful for in-store sales. Retailers can use this info to focus on what marketing strategies work best for different channels and find out how best to maximize sales.
The pandemic has really shaken brand loyalty, as customer sentiments gave way to practicality when delivery slots were rare, fewer products were on the shelves and lost jobs made budget brands more attractive to many. Omnichannel is a great way to win back customers and build up loyalty again, by showing customers that their shopping preferences are catered for and ensuring that things like loyalty points, card details and delivery addresses can be retrieved whenever they are needed.
Omnichannel means that retailers only need to collect a customer’s details once, which is crucial as 72% of consumers expect companies to know their purchase history regardless of the method of communication. This saves customers from needing to fill out forms multiple times and ensures that they feel recognized and valued for their brand loyalty, so are more likely to come back.
The hiring crisis in retail means that there are fewer employees on hand to help with in-store operations, lumbering each team member with a heavier workload. Physical stores are finding it tough to match the pace of operation of online channels, so integrating is more difficult. Making operations as efficient as possible helps ease the pressure, and omnichannel allows a retailer to better support operations in-stores.
With an omnichannel strategy, online orders can be fulfilled by any branch, so physical stores can make better use of their inventory as excess stock can be used for online orders. Using an omnichannel approach allows HQ to clearly see inventory data across all channels including stores, warehouses and fulfillment centres. This means that decisions about stock replenishment and delivery logistics are better informed, and so stores are better supported.
Although an omnichannel strategy has a range of clear benefits, there are challenges that retailers typically run into when trying to carry it out in stores. In a recent survey, only 14% of retailers reported that they had a fully operational omnichannel strategy.
Challenges can include:
21% of retailers encounter obstacles accessing sales data. This makes it impossible to measure performance across channels, manage resources and identify problems before they arise. In addition to this, 30% have issues with measuring campaign success, so retailers cannot learn from campaign results and create informed strategies for the future.
Jumbled and fragmented communication between stores, warehouses, fulfilment centres and HQ, leads to inconsistencies in how effectively an omnichannel strategy can be put in place. Over one third of retailers report that their omnichannel strategy is suffering because some teams are isolated from the company. This can become a problem for the customer, as 39% report that they struggle tracking the customer journey across channels and 33% have problems accessing customer data.
Without standardized training which can be pushed out at scale, it’s impossible for stores to deliver a consistent customer experience in every location and across every channel. 45% of retailers struggle to implement new technologies which will support omnichannel and 27% have problems clarifying their messaging and company vision across their entire store network. Frontline store teams are the ones who need to use new technologies and provide a useful service to knowledgeable customers who have come into the store after researching products in advance. Insufficient training on how to use technology, understand products, and provide a valuable service to customers sets frontline employees up for failure.
For omnichannel to work, retail HQ needs to have a clear line of sight into store operations. This insight is vital as the role of the store evolves and “phygital “ services like ship-from-store and click and collect become more and more common.
With an omnichannel strategy, HQ can clearly see critical data including:
Visibility into this data enables retailers to ensure that stores are operating as efficiently and consistently as possible and using resources in the best way they can. With this information, they can be agile and provide struggling stores with more support. It can also help HQ to work out how different marketing campaigns or promotions impact sales across different channels, so decisions become data-driven.
When a strong communication strategy is in place to connect store teams, it’s easy for employees on the shop floor to access customer data and carry out tasks. Regular, centralized communication keeps all employees in the loop with updates and expectations and makes it possible to retrieve information and customer data easily.
Furthermore, if it’s not lightning speed, it’s not omnichannel, which is imperative for retailers trying to implement a unified brand image across multiple locations. An omnichannel strategy enables urgent instructions to be communicated instantly to every store, ensuring a consistent, high-quality experience for customers wherever they choose to shop.
Pro-active training strategies that prepare teams with impactful training in preparation for a new product launch or software roll-out puts employees in the best position to be able to give customers the advice they need. Targeted and relevant training helps store teams stay a few steps ahead of the customer, so they can feel confident and empowered on the shop floor.
But to serve the well-researched customers of the omnichannel era, store teams also need training to be accessible in their flow of work. If they encounter a problem or an unfamiliar customer questions, they need answers immediately.
As with all aspects of omnichannel training should also be measurable, to ensure a consistent experience in every store and that every customer benefits from the expected level of employee expertise. Retailers need to be able to see which teams have completed training so it’s evident where more focus is needed.