Omnichannel is the buzzword you’ve been hearing for a few years at every retail industry conference and in every retail trade publication. Just in case you’ve been living under a rock, omnichannel retailing involves providing the customer with a seamless experience throughout their shopping journey on every shopping channel –brick-and-mortar stores, websites, mobile, applications, catalogs and call centers.
The average consumer has no idea what omnichannel retail means. But they do have high expectations. Capabilities once considered special are now viewed as standard from the consumer’s perspective.
Make a purchase online and pick up merchandise at the store? No problem.
And if the consumer is told their order will be available in a specific store at 11 am the next day,
it better be there.
Return merchandise to the store without any hassles? Sure, why not?
The consumer expects to be able to start shopping on their smartphone during an afternoon coffee break, drop a few items into a cart, and pick up where they left off from their laptop when they get home.
Once the purchase is made, they expect fast, inexpensive shipping.
In a nutshell, the consumer expects every touch point across the shopping experience to be
consistent and convenient. That’s the promise of omnichannel retailing.
These expectations were confirmed in a 2014 Forrester study commissioned by Accenture and hybris software, an SAP company. The report found that 71 percent of consumers expect to be able to view in-store inventory online, and half expect to be able to pick up online purchases in the store.
If a product is offered by multiple retailers at the same price, three quarters of consumers said their purchasing decision would be influenced by an offer of expedited shipping of two or three days.
Unfortunately, the majority of retailers aren’t omnichannel-ready. According to the Forrester study, only one third of retailers have incorporated capabilities such as reserving online for store pickup and cross-channel inventory visibility into their daily operations.
55 percent say their omnichannel investments are in response to customers who expect these capabilities and competitors who already have them. In other words, they’re being reactive instead of proactive.
A staggering 94 percent of retailers are facing obstacles to creating a truly omnichannel environment, including technical challenges, organizational siloes between channels, and poor operational execution.
A separate study, the Retail Insight: Fulfilling Consumer Demand report, reinforced these findings. This survey found that just one in 20 companies believe they are “advanced” in their omnichannel capabilities. 35-40 percent admit that they’re lagging, and only 11 percent are prepared for cross-channel fulfillment.
43 percent of surveyed retailers claim their omnichannel initiatives are being hampered by their legacy systems.
Clearly, there’s a serious gap between consumer expectations and retailer capabilities. Omnichannel success requires retailers and brands to knock down channel siloes and implement technology that provides product and inventory data that’s accurate, complete and current. Companies that have nailed their omnichannel operations are seeing higher profits, fewer markdowns and returns, and improved customer satisfaction.
Let’s face it. It’s an omnichannel world and consumers are calling the shots. The retail industry needs to deliver.