The beginning of 2017 brought a fresh challenge for retailers. According to figures, the UK’s high street brands started the first quarter with an abrupt 1.4% fall in sales. Many are pointing the finger at Brexit as the cause of the most dramatic quarterly drop in purchases in the last seven years. But no matter the source of the damage to consumer confidence, retailers must look past these concerns and make customer engagement a priority if they want to boost sales across Developing an omnichannel strategy is key because providing an uninterrupted experience between the physical, online, and mobile worlds for shoppers will help brands better serve their customer base, bolstering their businesses against market volatility.
To make a successful omnichannel strategy a reality, high street brands need be bold, use data effectively, and improve their physical and online stores.
Why should you care?
One study found that 73% of shoppers claim to be omnichannel users. But what should really make retailers sit up and take notice is the fact that omnichannel users spend between 50-300% more than single-channel shoppers. What’s more evidence points to omnichannel shoppers being more loyal to a brand than other consumers. So, in actual fact, spur-of-the-moment shoppers may not be the cash cows that experts thought they were. Far from succumbing to impulse buying, the consumers that spend the most do their research on products across various channels – both online and offline – before committing to a purchase.
As well as the more direct financial advantages for having a comprehensive omnichannel service, it can also assist with efficiencies in the back-end of a business. Omnichannel can make for a more targeted approach when it comes to supply chain management, as retailers can use the data gathered from various channels to find out more about customer behaviour and make changes to processes accordingly. Some retailers equip in-store staff with tablets, making it easier for them to check inventory for certain products and suggest alternatives to the customer, or offer customised delivery options. With omnichannel, end-to-end supply chain efficiency can be markedly improved.
The checklist: what you need to make it work
1) Take advantage of the data
This may seem self-evident, but along with the development of new technologies come additional swathes of information that must be analysed. Retailers can draw on this data to gain insights into consumer behaviour and discover new avenues for marketing. And the avenues are numerous. Take the Amazon Echo. Its home assistant, Alexa, can order groceries for you based on previous orders. Amazon has taken this technology further and incorporated a camera – the Echo Look – which can take full-length, 30-degree photos and use AI technology to make clothing recommendations based on this.
As is standard when a company starts talking about gathering data about consumers, many privacy concerns arose with the Echo Look. Its AI functionality, which in the future could be used to gauge our emotions, may seem unsettling to some. But they are in the minority. Despite the privacy concerns of new technologies, consumers often indicate they are willing to trade personal data for product offers and recommendations. In fact, one survey showed that 80% of UK consumers would share more data with retailers if this would improve their shopping experience.
2) Don’t neglect the bricks and mortar
It is tempting to focus all your time and energy on investing in online technologies. But successful omnichannel relies on retailers maintaining the appeal of their physical stores by incorporating new technologies and processes on the ground, not just online. After all, 65% of consumers still say they prefer to shop in person. This is reflected in the recent numbers from the BDO High Street Sales Tracker, which claims that despite the quarterly revenue slump, last month was the best June for the UK high street in the past six years. So, although overall sales might be suffering in the face of market challenges, it would seem the high street is still a significant lure for shoppers.
Even Amazon, which has dominated the online space like few others, has felt it necessary to open physical stores. The true value in omnichannel lies in bridging the gap between the different shopping options, and ensuring each one has the right integration with the other to offer a smooth customer experience.
3) Be bold
We are well past the point where simple solutions will cut it in the ever-competitive retail market. Customers expect more from brands and want retailers to go the extra mile. Luckily, the sheer innovation of the market means that there are a plethora of options to make this a reality. There are some inventive programmes being implemented across the industry; for example in House of Fraser’s Aberdeen store, the shop floor mannequins have a special code attached, meaning they can be scanned and the details about the clothing sent to the customer’s phone. And for those consumers who don’t want to leave the comfort of their own home, there now exists technology that connects them directly to a shop assistant, who can use smart glasses or smart phones to demonstrate, try on and advise about the products for sale.
The pressure is on
With more technologies at our fingertips than ever before, the opportunity for innovation has never been greater. And while this presents a significant opportunity for retailers, it also brings added pressure in the form of consumer expectations. As customers, we have come to expect instant, easy, efficient access to goods and services. And we want to be able to buy what we need, in the way that suits us best. Retailers must step up to this challenge, and make the most of data and technology to create the experience that customers demand. As the battle continues for the best omnichannel retailer, the brand that can conquer the complexity will no doubt be victorious in winning consumers’ loyalty and, most importantly, securing their next purchase.
By Richard Whomes, Director of Sales Engineering, Rocket Software