Guide to Omnichannel Retail

In a hypercompetitive retail market today, 75% of consumers expect that great brand experiences will be consistent across channels. This dramatic new requirement has altered the way businesses must engage and communicate with their customers. With this omnichannel retail explosion, the way retailers engage with customers will forever be changed to offer seamless experiences across all touchpoints, whether they be social media, apps, or brick-and-mortar stores.

Before you jump on the omnichannel bandwagon, it’s really important to know what exactly is omnichannel retail and why it brings value to a business. Find out how you, as a retailer, can stay ahead of the curve by studying case studies of meaningful customer experiences and different omnichannel approaches. Not having this system in place to begin with would make navigating the complexities of omnichannel retail a nightmare.

Read on to discover the most important facts we have gathered about omnichannel retail, including recent trends and features of this strategy, its pros and cons, and predictions related to the future of retail. By the end of this blog, you will know what it takes to make your retail business succeed on the omnichannel globe.

Here’s what we will cover:

• The importance of omnichannel retailing
• The benefits of omnichannel retail
• How to implement an effective omnichannel strategy
• Future trends in omnichannel retail

The importance of omnichannel retailing

Omnichannel retail is not just about having availability on multiple channels. It means offering a virtually seamless experience to the customers who enter your brick-and-mortar store or visit online. The difference between omnichannel and multichannel retail lies in how those channels interact. While multichannel refers to isolated, separate experiences within each platform, omnichannel means bringing everything together for a streamlined, seamless customer experience.

Changing trends in technology, such as artificial intelligence (AI) and augmented reality (AR), have made omnichannel retailing one of the most crucial aspects. Shoppers today need to seamlessly browse products on their phones, check out the store, and complete their shopping journey with store visits when they want to experience the products firsthand. Fail to map your digital transformation efforts against these new expectations, and you could be way behind the pack.

Retailers can harness the full potential of omnichannel and e-commerce strategies by combining brick-and-mortar stores and mobile devices into a single network. As suggested, this not only delivers to the expectations of your customer base but also plants meaningful seeds of engagement and omnichannel loyalty that will blossom over time, fostering growth for business interests. In a market where consumers want personalisation and convenience, omnichannel is no longer part of the strategy but a must.

Insightful omnichannel retail statistics

Here are a few eye-opening stats that highlight just how important omnichannel retail is and how it has completely overhauled the way consumers shop and engage with brands.

• In 2025, mobile will make up more than one-tenth (10.4%) of total retail sales, so it’s essential that retailers get their mobile commerce right now!
• Social commerce refers to buying products and services through social media platforms, particularly Instagram and Facebook. This is expected to grow at a CAGR of 34.8% during the forecast period (2020–25), and reached $45.74 billion in 2022. This further emphasises the necessity to incorporate social media into your omnichannel strategy.
• A striking 51% of shoppers make mobile purchases while in a store, underscoring the increasingly interconnected nature of digital and physical shopping.
• 47% of consumers are more likely to buy online if they know they can return the item in-store; therefore, your offline and online stores should have a unified cooperative refund policy.
• Over half (55% of consumers) first browse products online before buying in the store, again highlighting that accurate stock visibility is fundamental to retail.
• By the end of 2024, global online sales are expected to reach $4.1 trillion. Great proof that digital retailing is still in an expansion mode!
• In addition, 75% of U.S. consumers now research their purchases online beforehand on platforms that include social media, such as TikTok and Pinterest, illustrating the importance for retailers to have a formidable digital footprint.

The data suggest that omnichannel strategies are mandatory for retailers who hope to remain competitive. They affect everything from customer behaviour to purchasing decisions, and if businesses are going to keep up with them, then they need a seamless integration strategy everywhere.

The advantages of omnichannel retail

Creating a successful omnichannel strategy is essential for retailers to stay relevant in the developing retail landscape, as it caters directly to today’s consumer demands and fuels growth. Here are some of the most common advantages of omnichannel retailing:

• Meet customer demands: shoppers today want a personalised experience when they interact with you, be it online, through a mobile app., or in your physical shop. To meet these changing expectations, it is important for retailers to offer an all-inclusive experience, which omnichannel retailing ensures.
• Increase customer loyalty, engagement, and retention: personalisation of customer experiences and integration of customer loyalty programs play a vital role in keeping customers coming back to your store. This in turn drives up shopper retention and long-term loyalty, since shoppers who feel valued as part of a community show signs of repeat purchases.
• Maximise customer lifetime value: to develop stronger relationships and trust with your customers, converse with them through multiple touchpoints. This means more value from each customer during their relationship with the business as they come back to make repeat purchases and are loyal.
• Boost revenue and sales: Businesses that set up omnichannel strategies benefit from a significant boost in sales as it allows the customers to shift effortlessly between channels. Shoppers can browse products online and then purchase online or in-store, providing them with flexible options that encourage more spending.
• Enhance flexibility and accessibility: As e-commerce continues to thrive, the convergence of physical stores with online platforms adds more ways for customers to shop. Consumers want to be delivered the option of shopping in-store and purchasing online or by quickly checking inventory levels before going into the store and are more likely to choose retailers that support these options.

Simply put, moving to an omnichannel retailing model is less of a trend and more of a necessity if you want to keep pace with—and even beat out—competitors while selling more and connecting better with your customers. Retailers who implement these strategies will both provide better experiences and lay the groundwork for long-term success.

The challenges of omnichannel retailing

Omnichannel retailing offers many direct perks, but it does come with a set of omnichannel retail challenges and learning along the way. These are the hurdles that retailers have to be ready and equipped to navigate if they intend on realising an omnichannel approach’s full potential.

• Technology Integration: It is the biggest hustle to integrate a variety of technology trends, for instance, point-of-sale systems (POS), customer relationship management (CRM) software, and e-commerce platforms. Being compatible and working in harmony can be difficult to achieve, but it is necessary for a hassle-free shopping experience. For example, companies like Brown Thomas Arnotts are leveraging technology to enhance customer loyalty and boost omnichannel agility.
• Supply Chain Complexity: It is challenging to handle inventory maintenance across multiple channels, online and in store. This means ensuring that stock levels are accurate and products are available when and where customers want them. This involves a simple and highly coordinated line of supply and is quite problematic to do in practice.
• Data Management: In an omnichannel world, you collect information from various sources, such as social media, websites, mobile apps, and real stores. The amount of this data is overwhelming, and organising and analysing it can be challenging. Retailers require sophisticated infrastructure to handle this data, take actions on it in real time, and use it to deliver a personalised omnichannel customer experience.
• Employee Training: If you deploy an omnichannel strategy, your employees need to understand new technologies and the processes that come with them. It means being able to serve the customer equally well across all channels, which would require ongoing training and constant support for your staff.
• Cost: Going with an omnichannel strategy requires making a significant investment. Costs of technology, infrastructure, and employee training can easily rake up the investment basket. Retailers need to balance these costs, which are significant investments in potential long-term payoffs for the strategy to add up financially. For example, OneStock’s $72 million investment aims to help brands unlock their full omnichannel potential.

All of these obstacles may be overcome depending on preparation and the strategic utilisation of resources; however, they have to be well-known. For a more in-depth look at the benefits and challenges of omnichannel retailing, check out our Omnichannel Retail Pros and Cons article.

Omnichannel marketing in retail: how to get it right

Making omnichannel marketing work for your business is a must nowadays to continue being relevant in the market. These solutions are no longer about being cross-channel; they need to be channel-agnostic. It means that a well-outlined strategy is necessary. 

Follow this step-by-step guide to get your omnichannel marketing strategy in top form:

• Prioritise what matters most: Identify which parts of your business are the highest priority for you to check on. Does your e-commerce site feel ancient? Does your supply chain require a makeover? Understanding where to press will help you allocate resources and energy for those issues that need it most.
• Understand your customers’ needs: You must understand your customers to get the most from y‌our omnichannel strategy. It starts with collecting and reviewing customer data that paints a picture of their buying habits and behaviour. Utilise your customers’ journey using tactics like customer journey mapping and audience segmentation to understand where you interact with them most as a brand; this will help you discover more areas of value.
• Set SMART goals: Based on what matters most and your clients, you can set some goals. Make sure they’re SMART—specific, measurable, achievable, relevant, and time-bound. This keeps your omnichannel strategy realistic to drive towards measurable outcomes that are absorbed.
• Assess your current situation: Do your current channels and technology support the seamless omnichannel experience you seek? Locate the gaps and invest in solutions that meet your goals. This will include upgrading your digital transformation strategy and introducing new technologies.
• Choose your channels wisely: When it comes to businesses, not all channels are created equal, and none of them will be a perfect fit for your business. Determine which channels influence your customer decisions most and deliver there. Social media are crucial for reaching present-day consumers, and you should integrate them into your strategy.
• Improve Data Management: As data is the backbone of a good omnichannel, superior tools can help manage this. Find great customer engagement software and loyalty platforms that would give valuable information in return for proportional investment. Doing such will allow you to add a unique touch on the client side and offer tailored incentives that resonate with your customers.

By completing these simple steps, you will be well on your way to the development of an effective omnichannel marketing strategy that not only satisfies your customers needs but also sets up a success pathway for business in general.

The future of omnichannel retailing

The ‘next frontier’ of omnichannel retail will see a continuation and expansion as omnichannel trends and new technology open up opportunities across the board around consumer behavior. There are some common trends and predictions that retailers can use when looking into their “crystal ball” to see how retail will adapt in order to gain a competitive advantage.

Augmented and virtual reality

The newest omnichannel retail trends will be in Augmented Reality (AR) and Virtual Reality( VR). The digital experience—and, by extension, omnichannel shopping—these innovations will allow for even more interactive and personal experiences in such a way as previously unimaginable. This sort of immersion will be a game changer when it comes to linking the online world with real-life shopping experiences, providing even more confidence in purchase decisions.

Artificial intelligence and chatbots

Artificial intelligence and chatbots are also trends that you can not ignore when it comes to your retail business. These smart assistants will remain vital in delivering tailor-made customer service, managing FAQs on the fly, and directing shoppers through their shopping experience.

Brick-and-mortar shops aren’t going anywhere

Brick-and-mortar shops are not going out of style, even though more and more people have opted to shop online. Actually, 85% of retail sales still occur in person. For retailers, the challenge will be to create a single customer journey that remains consistent across every channel. This way, consumers who shop in-store are presented with the same experience as those shopping online. This includes post-purchase engagement like making returns easy and providing great customer service to your customer’s expectations.

Personalisation is key

Another critical trend is the rising consumer expectations in terms of personalisation. You will need to provide tailored recommendations, such as intelligent and personalised shopping, based on both history and preferences. This significantly increases customer loyalty and satisfaction.

Creative marketing approach

And lastly, marketing needs creativity more now than ever. With so many choices and information being thrown at the modern-day consumer, retailers are more than ever looking for new ways to interest and grab people’s attention. With this crowded market, creative campaigns that speak to shoppers will be crucial to breaking through the clutter.

To thrive in today’s change-as-the-norm retail environment, stores must adhere to these 5 omnichannel trends while maintaining a consistent and cohesive strategy across all channels. For more information about new innovations and what to take away from them, be sure to attend the next Omnichannel Futures Conference.

Final thoughts

In today’s rapid retail climate, an omnichannel strategy is now not a luxury but an essential. It is crucial for consumers, as they expect a seamless, connected experience between online shopping, mobile apps, and in-store purchasing. However, as reported by McKinsey, only 25% of consumers are happy to use the omnichannel solutions offered by retailers today. That stat serves as a clear indication there is tremendous room for growth.

Retailers will have to continue investing in their omnichannel strategies as customers get increasingly used to sophisticated online shopping experiences. This includes, but is not limited to, incorporating technology, making it personal, and being consistent in all touchpoints. Retailers who are tuned to changing market trends and constantly refine their tactics are the ones who will survive. For a deeper look into the future of omnichannel retail, read the Omnichannel Futures 2024 Review.

Join top retail industry experts at our upcoming Omnichannel Futures retail conference and get your burning questions answered. Don’t miss out—reserve your spot today!

 

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