Omnichannel is a “journey, not a destination.” That’s what Forrester analyst Sucharita Kodali said at the 2019 NRF Big Show, and she’s right.
The industry is many years into the journey of trying to provide both the customer and store associate a seamless brand experience.
Retailers today know what’s at stake. Shoppers are mobile-first, and their expectations are evolving faster than ever before. In fact, nearly three out of four shoppers now access their phone while in-stores—to read reviews, compare prices, check out. Those brands that can’t answer consumers’ changing expectations risk being left behind.
It may seem we’ve covered ground on the omnichannel path. Is it simply because we’ve been on it for so long, or is retail really progressing?
Some retailers have tackled omnichannel head on, but most haven’t. The majority of brands have approached omnichannel as a strategy versus an organizational imperative. As such, they’ve responded to customer challenges around things like convenience in silos and with point solutions. The results suggest varying degrees of success.
The NewStore Omnichannel Leadership Report is an annual report that evaluates 150 apparel, lifestyle and luxury retail brands, and assesses their omnichannel capabilities and maturation. While overall there’s been subtle improvements, we’re not in a position to retire omnichannel from our retail vocabulary quite yet.
Mobile is the clear connective tissue between consumers, store associates, product, and inventory information, but it’s being grossly underutilized across the customer journey. In order for omnichannel to become a reality, today’s retailers need to bridge online and in-store with mobile across three pillars: the customer, the transaction and inventory.
Search & discover
The average path to purchase is not linear. Smartphones will play a role in nearly 90 percent of all digitally-influenced sales by 2022, which is why retailers are increasing their number of touch points with shoppers. They need a way to close the customer expectation gap and drive conversion, regardless of the buying trajectory.
Despite the prevalence of “research before purchase,” retailers aren’t making it easy for customers to easily and efficiently find a product. Only 36 percent of brands show in-store inventory online or through their mobile app. Even more, less than a third of brands offer customer-facing devices in-store that access their website.
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Shoppers expect information to be at their fingertips. If they can’t quickly find what they’re looking for, it’s likely that they’ll move on to a competing brand. Today’s buyers are fickle, and brands must recognize the importance of a strong search experience.
It’s not only about the customer, though; store associates with easy access to inventory can quickly fulfill demand and exceed customer expectations. However, 55 percent of store associates can’t access their store’s inventory, and 61 percent can’t access inventory at another store location.
Without visibility into all product, the associate is limited in their ability to cross-sell and upsell. This means less discovery for shoppers, and a hit to a brand’s bottom line.
Personalization & engagement
While most consumers start their shopping journeys online or on mobile, 90 percent of retail sales still happen in brick and mortar. It’s very primal to see, touch and feel a product. This is why it’s important to offer a friction-free, seamless store experience.
But retailers haven’t scratched the surface on clienteling. Shoppers are becoming more comfortable with personalized services, but almost all store associates (93 percent) cannot see a customer’s wish list in-store. Similarly, 68 percent of associates can’t see omnichannel order history or other customer data. Meaning, most brands don’t have a 360-degree view of their shopper—their likes, dislikes and motivations.
Core to personalization is offering real value. Shoppers don’t want to be reminded of what they’ve bought recently or in the past—that’ll likely come across as an annoyance more than anything. They want to feel like a retailer really knows them, making each touch point exclusive.
The feeling of exclusivity often comes from “white glove services” like appointment scheduling. Appointments can result in significant upselling, but only 9 percent of brands surveyed offer in-store appointments. This is a good example of retailers not taking advantage of store associates, who are responsible for laying the foundation for profitable, long-term relationships.
Path to purchase & fulfillment
Today’s shoppers don’t think about channels separately. There is no online or offline—there is one brand. These types of shoppers are far more valuable than those who limit their shopping to a single channel. It’s a reality that retail hasn’t fully come to terms with, as most retailers are trying to catch up to customer’s expectations versus exceed them.
It’s one thing to find a product, but how easy is it to get that product to the customer? In the on-demand economy, it’s easier than ever thanks to leading forces like Amazon. But not all brands are able to quickly and efficiently fulfill orders. Only 21 percent of retailers are able to sell items to customers from anywhere via endless aisle on a mobile device.
Not only do customers except choice in stores, but they also expect it when buying online. Modern fulfillment options like buy online pick up in-store (BOPIS) and ship from store are cornerstone omnichannel capabilities. They offer convenience benefits, and BOPIS tends to result in additional in-store sales. Even so, only 26 percent of brands offer it. This is up from 18 percent in 2017, but still far from ubiquitous.
When it comes to new levels of customer convenience, shoppers also need mobile-first options like Apple Pay. This includes frictionless checkout from anywhere in the store. Associates never have to leave the customer’s side, and shoppers don’t have to stand in long lines. It’s a win-win. And more and more retailers are catching on—57 percent of brands accept Apple Pay, which is activated on 383 million iPhones worldwide.
Conclusion
In short, delivering true omnichannel is hard. Retailers are trying to expedite the process to reach more customers, but there is no promise of scale or long-term success in this strategy. To achieve excellence, brands need to eliminate organizational and technological silos to better connect customers to the brand, store associates and stores. Remember, the journey is ongoing. We can’t move on from omnichannel until we’ve got it right.