Omnichannel experience
What we are seeing today is only the beginning. Soon it will be hard to even define e-commerce, let alone measure it. Is it an e-commerce sale if the customer goes to a store, finds that the product is out of stock, and uses an in-store terminal to have another location ship it to their home? What if the customer is shopping in one store, uses his smartphone to find a lower price at another, and then orders it electronically for in-store pickup? How about gifts that are ordered from a website but exchanged at a local store? Experts estimate that digital information already influences about 50% of store sales, and that number is growing rapidly.
As digital retailing evolves, it is quickly morphing into something so different that it requires a new name: Omnichannel retailing. The name reflects the fact that retailers will be able to interact with customers through countless channels—websites, physical stores, kiosks, direct mail and catalogues, call centres, social media, mobile devices, gaming consoles, televisions, networked appliances, home services and more. Retailers must bear in mind that consumers don't think in terms of channels but brands, the brand promise has to be consistent everywhere. Unless conventional merchants adopt an entirely new perspective - one that allows them to integrate disparate channels into a single, seamless, Omnichannel experience - they are likely to be swept away.
Improved search tools, access to user reviews, instant price comparisons, active social networks and more are fundamentally changing shopping. Computers, smartphones and tablets provide access to endless sources of information that help consumers decide what to buy and where to buy it. And retailers increasingly rely on evolving technologies such as integrated inventory software, radio frequency identification (RFID) tags and quick response (QR) codes to better manage inventory and offer new services.
But technology alone is not innovation. Too many retailers are spending on technology without transforming the customer experience—buying iPads for their sales associates, for example, without a vision of how that will enable them to win in an omni-channel world. And the pace of change is increasing; retailers’ choices on how to deploy technology across channels and throughout their supply chains are becoming more complex.
Customers are out in front of this omni-channel revolution. By 2014 almost every mobile phone in the United States will be a smartphone connected to the internet, and an estimated 40% of Americans will use tablets such as the iPad. If you doubt whether consumers are ready for technology-driven retail solutions, find a “dumb” video display in any public location and look for fingerprints on the screen—evidence that people expected it to be an interactive touchscreen experience.
A successful omnichannel strategy should not only guarantee a retailer’s survival—no small matter in today’s environment. It should deliver the kind of revolution in customer expectations and experiences that comes along every 50 years or so. Retailers will find that the digital and physical arenas complement instead of compete with each other, thereby increasing sales and lowering costs. Ultimately, we are likely to see more new ideas being implemented as customers and employees propose innovations of their own. In today’s environment, information and ideas can flow freely and retailers that learn to take advantage of both will be well positioned for success.
