Retailers missing the point of omnichannel commerce
April 6, 2016
To succeed at omnichannel, retailers must first understand what it means.
Today, it's hard to hear or read the word "retailer" without "omnichannel" being close behind it. Companies are now facing a wide range of struggles to maintain an edge over competitors and appeal to target audiences in an increasingly crowded market.
Both eCommerce and brick-and-mortar strategies are evolving, with omnichannel taking center stage. And, while most business owners may understand that it is something they have to put on the front lines of their operational strategies, it seems not everyone may be entirely clear on exactly what it is and how it should be executed.
Off-target approach to omnichannel
O Alliance and Revmetrics, a data analytics firm, recently released a report that revealed that there is a misunderstanding among retailers regarding the actual meaning of omnichannel, the New York Business Journal reported. The true premise behind it is that a company operates in a way that allows buyers to purchase from it regardless of where they are or what platform they are using (mobile, laptop, in-store, etc.). And this is something that most do. The problem is that too many are trying to do that with isolated channels; instead of having an integrated platform and end-to-end omnichannel solution, their workers, inventory and warehousing and analytics and reporting are all segregated.
According to the source, O Alliance Co-Founder Andrea Weiss said she has been disappointed by how the retail industry has interpreted and applied the omnichannel concept; operating in silos has hurt many companies, she indicated, which has become obvious with the amount of major brands having to shut down store locations and reporting disappointing earnings.
So what steps can sellers take to ensure they are taking the appropriate steps toward optimizing their approach to omnichannel? Below are some of the strategies and solutions from industry experts.
Combine and collect customer data (in the same way, on every platform)
"Stop thinking about omnichannel and think about circular commerce," Weiss said, according to the New York Business Journal. What does this mean exactly? That each channel should blend with the others.
The O Alliance research found that a major issue is that retailers are not getting an accurate picture of customer data; there is a disassociation with what is tracked online versus in stores, the New York Business Journal reported. Consumers shop on multiple channels so, by not making connections between the data, retail companies are not offering their customers the best experience possible.
Lead with a customer-first approach, always Sam Walton, founder of Wal-Mart and Sam's Club, once said, "There is only one boss - the customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else."
This is another point that Weiss emphasized, the source indicated. She explained that retailers need to take a customer-centric approach to selling. And, to do this, companies need to realize that managing each channel as its on entity is not effective because, essentially, shoppers perceive them to all be the same or, at the least, very similar.
Create consistent experiences with a consolidated platform
The driving force behind omnichannel is to provide shoppers with a convenient, uniform experience across multiple platforms. This is incredibly difficult for retailers to do if they have not created an integrated system themselves.
RIS News reported that Boston Retail Partners research found that "78 percent of retailers plan to implement a unified commerce platform in the next five years." This statistic indicates that a growing number of organizations are realizing that omnichannel success is not possible without bridging the gaps between operations. By transitioning to a centralized platform that allows inventory, warehouse, customer relationships, order fulfillment and all other critical processes to be managed in one place, commerce companies will be able to significantly enhance their ability to merge digital and physical selling.
It can be difficult for retailers today to know exactly how to approach their respective business models and strategies. The proliferation of digital devices is creating an increasing number of challenges. In addition, consumers' expectations are changing, further complicating the eCommerce market. Moving to a centralized omnichannel hub can help streamline operations and improve efficiency, which allows the brand executives to focus on other critical areas of business.