The retail industry is consistently on the move.
With the emergence of ecommerce, the rise of smartphones, and the growth of social media, consumer purchasing behavior has grown more complex over time.
While 87% of consumer spending in the US occurred in physical brick-and-mortar stores, 39% of digital consumers visited the brand’s website, 36% read customer reviews, 33% attempted to price match the product online, and 32% found the brand on Amazon, all before making a purchase in-store.
Today, consumers are equipped with knowledge and technology, empowering them to take additional actions with their purchasing decisions.
That’s why businesses need to evaluate their retail strategies.
Companies need to adapt to new shopper behavior and reshape their existing business models if they want to succeed in the industry.
Despite these challenges, we’re going to show you how you can thrive in the omnichannel era.
The Survival Guide will help you transition to an omnichannel brand and suggest easy-to-implement omnichannel strategies that you can start today.
But first, let’s understand how and why consumer behavior changed so rapidly.
1. Changes in consumer behavior
Consumer behavior shifted significantly in the last decade.
The way customers shop, how they consume information online, and how they engage with businesses through their devices (computers, smartphones, and tablets), forces brands to rethink and redo their shopping experience.
But for brands, it’s rarely a one-off change.
The changes are continuous and often match consumer behavior and expectations.
How has consumer behavior changed?
Back in the 2000s, there were only 95.1 million internet users in the US. The smartphone didn’t exist. And ecommerce was an extremely uncommon term.
In 2010, 61% of consumers in the US had access to broadband internet. While 85% of Americans had mobile phones, they weren’t powerful enough to shop online yet. Nokia had a 31% market share of the mobile phone industry, while Apple had unveiled the first commercial smartphone 3 years ago, in 2007.
Fast forward to today, and there are 293 million internet users in the US. 69% of Americans have purchased an item online. And 77% of Americans own a smartphone. Furthermore, 79% of smartphone users have made an online purchase using their mobile in the last 6 months.
By 2021, mobile ecommerce sales will make up 72.9% of total ecommerce sales.
Twenty years ago, we didn’t have widespread internet connectivity, and mobile ecommerce just barely existed.
The adoption of the internet and the smartphone in the last decade significantly changed the game for every retail business today.
- With the internet, a consumer could discover new items via Facebook, shop on the brand’s ecommerce website, and pick up the item in-store.
- But with mobile, they can also search for information before making any purchasing decision at the physical shop, contact customer support on their mobile Facebook Messenger app, or post a Google review via the company’s mobile website after purchasing in the shopping center.
Today’s customers leverage digital products so they can have a multi-dimensional shopping experience.
They can now research extensively online before they buy.
And once they’ve made their decision, they can purchase the product anytime they like.
The customer journey
With 73% of customers purchasing from multiple channels, mapping out the customer journey is no longer a simple task.
The purchasing journey doesn’t consist of a linear straight line anymore.
It now resembles a complicated route with many touch points along the way.
Despite the multiple touchpoints, the Rockbridge Associates Study found a process concerning important purchases (products over $50 that require a level of decision-making).
The process includes:
- Gathering data and information
- Checking Out
The study found that:
- Only 29% of people purchased right away in-store. They gathered data and information in the physical shop by asking the staff questions, scanning the products, or reading the labels.
- 20% ordered online via a device like a computer, mobile, or laptop, and will receive the products at their home
- 3% ordered via a phone call and will either pick up the item or have it shipped to their homes.
- But 48% were omnichannel purchases. Here, everyone conducted research online to make an informed purchase. These people also required a longer time to make a decision. The interactions with each channel varied significantly. Some researched at home and then purchased in store, while others would research on their mobile device in-store and make the purchase quickly afterward. The majority of people required at least one week for research and planning.
In the example above, the buying process is complicated because almost 50% of the purchases involved interacting with many different online and offline channels.
So how do business owners, founders, and marketers fulfill the demands of the modern day customer?
By adopting a seamless, integrated approach between all the touchpoints in the customer journey.
2. Why have an omnichannel experience?
In the single channel era (the early 2000s), consumers would purchase products in-store.
With the rise of the internet, customers could buy in-store or online.
Today consumers can also shop via other social media channels like:
So not only are there many channels, these channels also exist on many different devices.
Today, a customer’s purchasing journey links many online and offline touch points.
That’s why an omnichannel experience is necessary to serve the modern day consumer. It’s essential for businesses to create a cohesive customer buying journey across all touchpoints and channels, and if they want to thrive in the retail industry.
Senior-level executives agree. 81% of CxOS anticipate more digital interactions with customers by 2020, and 66% expect a greater focus on customers as individuals.
Customers expect this too.
In saying that, very few companies can successfully implement an omnichannel experience. Over 90% of marketers struggle to connect more than three channels in the customer journey seamlessly.
Although an omnichannel experience can be tricky to tackle, the difficulties arise from a weak foundation,non-integrated tech platforms, disparate data, and a lack of resources. 64% of marketers don’t have the resources to implement omnichannel marketing effectively.
In this guide, we will show you how you can set up a proper omnichannel foundation for your business or organization. While omnichannel strategies are more expensive and time-intensive, consumers expect consistent interactions across all channels in 2019.
But first, let’s define the term omnichannel.
What is omnichannel?
Omnichannel is a multichannel strategy that provides consumers an integrated and seamless experience. Here the customer experience flows like a constant, uninterrupted stream between all the channels via multiple devices.
This unified approach to commerce puts the consumer first and takes into account all the touchpoints (both online and offline) in the customer journey.
- A consumer could be looking to buy a pair of pants on an Instagram influencer’s post. They click on the post’s link to the pants, which directs the consumer to the shop’s mobile ecommerce website. The consumer subscribes to their email list to receive 10% off the first purchase and makes an online account with the company.
- The consumer then added the pants to the cart, but was somehow distracted and forgot to check out. 2 hours later, the consumer receives a notification in their inbox, reminding them that they can still redeem the pants with a 10% off discount. After visiting the site, the consumer notices that the pants are now out of stock.
- They call up customer service, asking if they can pre-order, so when the pants are available 2 weeks later, it can be delivered straight to their home. Customer service replies this is possible and makes an order for the customer.
Although the example above sounds convoluted, it’s how most customers shop today.
But there’s no single framework to follow.
Understanding the convergence of these online and offline interactions requires a more personalized custom tailored connection with the customer and their purchasing journey.
Putting the customer first
The customer is always at the heart of every successful omnichannel strategy.
What do I mean by this?
It doesn’t matter if you are a B2C or B2B company, whether you have a brick-and-mortar store or you sell purely online, the modern day consumer likes control.
That’s why a more customized and personalized approach always wins out.
Customers today like to control the purchasing process, ensuring that they enjoy every step in the buying journey, from gaining awareness, to consideration, and to purchasing the product.
Going omnichannel will help you build a direction and road map for your consumer’s purchasing journey. You will be able to identify which channels are required to attract customers, what actions are needed to take place to nurture these relationships, and how to increase your customer’s lifetime value (CLV).
But first, let’s have a look at all the advantages you gain when you go omnichannel.
Advantages of going omnichannel
- Increased customer satisfaction
Consumers want to be able to shop, contact and communicate with companies on platforms they prefer, which can range from the physical store to the online ecommerce website, social media pages, the company email, to even a mobile app.
While going omnichannel isn’t easy, brands that can adopt these strategies and use three or more channels experience a 250% higher purchase and engagement rate than single-channel campaigns.
- Boost in sales
Omnichannel strategies give customers the control they want. It allows them to shop 24/7 while giving them the flexibility to purchase through the channel of their choosing.
This combination increases buying potential and opportunities, boosting customer retention rates, customer lifetime values, and overall sales.
In fact, customers that engaged with brands using three or more channels spent 13% more than those who didn’t. Shoppers that involve with retailers on many channels also made purchases more frequently.
- New streams of revenue
Consumers are shopping in so many different places simultaneously. From physical stores, online shops, Amazon, eBay, Facebook, Instagram, and even Snapchat, going for an omnichannel strategy makes more touchpoints shoppable.
Businesses can leverage off other platforms to build and develop new income streams. This way, you can capture more prospects and leads at every step of the consumer purchasing journey.
- Increase data and information
Multiple channels of interaction and communication create a wealth of data for businesses. The data is invaluable as it helps the brand gain further insights into their customers and the customers’ shopping behavior.
This helps the company craft a more custom tailored and personalized strategy which consumers prefer.
3. A brief history of the omnichannel era
How did we get here?
While we’ve explained what an omnichannel experience is above, it’s essential for marketers, founders, and professionals to understand its origins.
How did the omnichannel experience emerge?
What happened, and why are there high levels of expectations on retail businesses today?
The term omnichannel came from its predecessors: single channel, multichannel, and cross channel.
- Single Channel:
A single channel focuses only on one channel.
Before the internet and smartphones, most people conducted business from their physical brick-and-mortar store. When the internet came, some companies also implemented a single channel strategy by launching an online ecommerce shop.
While a single channel is not too expensive, it has many limitations. Brick-and-mortar businesses were limited to their local demographic and community.
Most businesses don’t go for a single channel approach today because it comes at a big expense of missed opportunities from other channels.
Multichannel retailing is when businesses sell to customers through offline outlets and online channels.
It’s a strategy most businesses aspire for and invest in today.
After internet usage grew, and smartphones entered the market, many businesses saw the opportunity to increase the brand’s visibility on these new channels and acquire new customers.
Today, it’s common to hear businesses have multiple channels like an online ecommerce website, a Facebook page, an Instagram profile, and even a Pinterest account.
Multichannel strategies, however, have their drawbacks. They often work independently of one another and are used separately and not linked together.
Furthermore, when businesses manage multichannel strategies poorly, they can be an operational headache.
- Cross Channel:
Businesses then realized that, while having multiple channels are important, customers want to have a seamless experience across all these channels.
So that’s where the term cross channel came from.
A cross channel strategy is when brands provide an integrated experience across many different channels.
While it’s incredibly similar to an omnichannel approach, a cross channel strategy focuses on how consumers move across different channels.
Whereas, an omnichannel strategy focuses on the customer journey.
Since all these terms come from the same root, it’s not surprising to see a bit of overlap between their definitions. But the omnichannel experience is entirely different from the experiences above.
Single channel, multichannel, and cross channel focuses on the channel.
The omnichannel experience focuses on the customer.
Why is the Omnichannel experience different?
The term omnichannel emerged in 2003, before the widespread use of the internet, smartphones, and mobile ecommerce.
But even during the early years, no one called it omnichannel.
They called it customer centricity.
Instead of following a specific formula, companies decided to put their customers first. It was this shift in thinking that makes the omnichannel experience so successful compared to the other channel strategies above.
The omnichannel strategy is about building a seamless, integrated, and consistent customer experience, regardless of the channel, device, and platform.
This includes providing excellent customer service, having a clear and consistent message, and being available in each step of the customer journey.
Omnichannel and Customer Centricity
What does it mean to be customer-centric?
Being customer-centric means looking at the company from the customer’s perspective.
It’s a way of conducting business that provides an excellent customer experience before, during, and after the sale to ensure repeat business.
To explore what this means, let’s have a look at Best Buy, an American multinational electronics retailer that redefined their company strategy back in 2003.
We wanted to bring up Best Buy, despite it being an older example because it was a company that became customer-centric and explored omnichannel strategies before it was a popular term.
Best Buy’s Customer Centricity
- Best Buy was looking for a way to differentiate itself in the market.
- To remain competitive, they had to focus on exceeding customer service expectations. Walmart, Best Buy’s primary competitor, was always understaffed when it came to customer service in the electronics department. So Best Buy hired more customer service staff and trained them to communicate effectively with customers.
- Best Buy also saw an opportunity to move into the ecommerce sector. Online stores were growing, and Best Buy realized that it could take advantage of emerging technology. The company began selling electronic gadgets and console games shortly afterward.
- But after spotting these opportunities, Best Buy found that not only was ecommerce going to grow rapidly, but to tackle any new change, the company had to be adaptable and flexible to changing consumer demands.
As you can see, Best Buy’s business strategies came from their understanding of their customers’ buying journey.
They recognized that many people didn’t need to come in-store to purchase electronic goods and console games. They were happy to buy the goods online if they could trust that the company could get the products delivered in quality condition, within a reasonable time-frame.
Best Buy soon added customer centricity to their business strategy after continuously learning from customer support.
You can’t template the omnichannel experience.
The Omnichannel approach is different with every business.
Most businesses fail with omnichannel implementation and management because they try to put a framework onto their business.
There are no shortcuts here.
Going omnichannel requires you to understand your customers well.
You can’t master the omnichannel approach if you don’t put your customers at the heart of your organization.
4. Successful omni channel campaigns
At this stage, you should have a solid understanding of what an omnichannel experience is, why it’s essential for businesses today, and where it originally came from.
But we know learning is best with detailed examples.
So apart from the Best Buy example, which other companies put customers at the center of their business strategy?
More importantly, how do they do it today?
Let's look at two examples:
First up, the almost 100-year-old Walt Disney company and how they manage an omnichannel experience with all their theme parks.
And second up, Oasis Clothing. A UK fashion brand that has made headlines for its innovative iPads in-store.
The Walt Disney Company:
The Walt Disney Company has one of the best omnichannel experiences when it comes to its Disney theme parks.
They connect their offline and online worlds extremely well, blending the connections between their website, mobile app, and in-park activities.
Let’s begin by mapping the customer journey of a family looking to go to Disneyland in Tokyo.
Disneyland Tokyo - Customer Journey
- Disney Website: Research
Before going to the Disneyland theme park, many parents and families visit the website to gain more information. The site builds up excitement as it allows these potential customers to see the attractions, restaurants, and fun activities they can enjoy with their families.
The online web experience extends to their social media pages: Facebook, Instagram, Twitter, and Snapchat, where they can see daily updates of the theme park activities.
Disney also allows people to create their itinerary, where they can plan their day and schedule events they want to view.
- Disney Mobile App: Guide
At Disneyland, customers can download the Disney mobile app and use it as their Guide. The mobile app contains a comprehensive map that directs customers to their destination of choice.
The mobile app takes into account the whole Disney Experience. You can use it to look up wait times for each attraction, to book eating arrangements, to share itineraries with family and friends, and even discover where to go to meet your favorite Disney characters.
Customers can maximize their Disneyland experience by being able to plan their activities around the real-time data seen in the app.
- Disney Wristband: Contactless Payments and App Integration
Unlike other theme parks that give paying users a plastic wristband, Disneyland customers receive an exclusive Disney wristband that is durable and comes in many different colors.
The Magic band, however, serves many purposes. It serves as tickets to attractions and rides. You also make payments via the wristband, so you don’t need to fumble around with cash or credit cards.
These wristbands also connect to your mobile app. Photographers taking your picture at the theme park can scan your Magic and upload these images to the app. If you like the pictures, you can instantly purchase them on the app.
While this is an overly simplified journey of a family going to Disneyland, it shows how Disney takes each important touchpoint in the customer journey seriously.
The unification of the different channels, the Disney website, theme park, mobile app, and wristband, make the purchasing process simple for customers.
Even within the theme park, you only need to tap your wristband to access rides and make additional payments.
As you can see, Disney’s omnichannel strategy allows every customer to experience a high degree of customization and personalization in their purchasing journey.
On the business end, it helps Disney manage the flow of customers into the park and respond to simple events like understanding where to deploy more staff or enabling earlier maintenance checks on popular rides.
Oasis, a UK fashion retailer, made headlines in 2018, by using iPads in-store to help customers with their purchasing decisions.
How does an iPad contribute to a better customer experience?
If the item was out of stock, the staff member could take out their iPad and identify another store with stock availability. Alternatively, they could even purchase the item and have it delivered home for the customer.
Before we dive into Oasis’s omnichannel strategies, let’s look at what the purchasing journey is like for their customers.
Oasis - Customer Journey
- Social Media - Instagram: Exploring Fashion Trends
Oasis’s social media pages are one of their primary marketing channels.
Take Instagram as an example. With 319k followers, and a frequency of 2 posts every day, Oasis has a firm Instagram strategy that involves showcasing their new products and sharing user-generated content.
- Website: Exploring the brand
Although Oasis has a brick-and-mortar store, their website is on par with other online ecommerce fashion brands. It’s responsive and has a friendly design.
You can see here that, while the website and Instagram page are separate channels, they both have a consistent color scheme, imagery, and messaging.
On the product page, users have the option to view the item from many different angles. There is also a video to see the product in action. Customers also get an indication on which sizes are low in stock, and which items are available in certain stores.
- Brick-and-Mortar Store: New shopping experience
While the website links up with the physical store well, Oasis’s brick-and-mortar shop is the most impressive element of their omnichannel experience.
They’re one of the first retailers to introduce iPads, which allows them to share a lot more information with the consumer than other fashion brands.
Customers want up-to-date information on products and inventory.
If you walk into these stores, sales staff are equipped with iPads and can give you more information concerning each product right away. The iPads also double up as a cash register as well!
Furthermore, there is also an Oasis app that can enhance the in-store shopping experience. With 82% of shoppers using their smartphones as shopping assistants in store, it’s no surprise that Oasis is going for a very blended online and offline retail approach.
While The Walt Disney Company and Oasis’s industries, business models, and target audiences are incredibly different, both companies have adopted an omnichannel strategy that is working exceptionally well.
So well that Hubspot referenced them as examples of brands with brilliant omnichannel experiences.
Although there are different ways to define the omnichannel experience, we wanted to show you these two examples because, both The Walt Disney Company gave consumers choices.
Customers from The Walt Disney Company and Oasis had the option to choose where they could conduct research and buy the product or experience.
Overall, an excellent omnichannel experience allows the consumer to choose how they will interact with the brand.
It doesn’t matter which channel or platform they go for.
Consumers are confident that regardless of the channel, they will have a positive experience with the brand.
5. Transitioning to an omnichannel strategy
If you’re action-oriented and are itching to start, here’s the fun part.
We’ve talked a lot about an omnichannel strategy and experience.
But how do you get started?
Do you jump in right away and start, or are there key aspects you need to understand before implementing?
Because an omnichannel experience requires a solid foundation, we’ve broken this section into two parts.
Preparing to go omnichannel:
- Understand that customers are always changing
The world is evolving, and this affects the way we do business. Traditional marketing strategies are outdated because they capture the beliefs, attitudes, from consumers decades ago.
In today’s age, businesses need to put the customer first and understand how and when they interact with the brand. This means that your business needs to collect data consistently, and you will need to be able to analyze the data to make future business decisions.
Don’t be surprised if your customers’ journey changes within the next few years. This tends to happen when a new technology is released.
- Own your digital channels
Brands also need to interact with customers with their preferred channels to remain relevant today. That’s why consumers expect brands to build their channel networks. These include social media pages, claiming their website domain, email, and other online platforms.
By owning these channels, your brand can gain consumer information and data, which can be used to improve the user experience.
But beyond this, if you don’t take ownership of a channel, you can miss out an opportunity to interact with your consumers. This is particularly important when consumers are reaching out for questions, queries, or posting reviews.
- Construct a data strategy
Since customers are always changing, make sure you build a robust data strategy so you can make sense of the information gained from your omnichannel efforts.
84% of marketers use customer data to inform their marketing efforts, and so should you.
We recommend outlining data you want to collect and understanding why you need it. Collecting data will help you gain insightful information that you can implement in your channels.
Without data, it’s hard to have a clear understanding of consumer needs, especially since the customer journey is continually evolving.
- Align all goals within the company
An omnichannel experience affects all departments within a company.
It requires a lot of collaboration and data from each department, especially when it comes to building the customers’ entire purchasing journey.
Ideally, every department works towards a similar goal. A shared goal could be, for example, increasing customer engagement by 10% this month.
When broken down, these goals are different depending on the department. For the social media team, increasing engagement could mean, replying, and responding to Instagram comments and questions on the Instagram story more frequently.
But for the customer service team, it could mean, providing a more personalized experience for customers who run into existing issues on the mobile app.
While this process may be complicated, it’s important to show everyone in the team the benefits of going omnichannel.
- Gain the Support of the Executive team
You might be able to gain other’s support but to align goals in a company effectively, you will need help from the executive team as well.
Providing an omnichannel experience can be disruptive to many departments.
It will create a lot of change and chaos in the short-term.
You will also need a large marketing budget, and additional specialist staff to make it work.
That’s why 42% of retail executives spend up to half their marketing budget on omni channel initiatives.
We recommend sharing the benefits of an omnichannel approach with the executive team so they can justify the changes and costs involved, and assist you where required.
If you follow these steps, they will help you transition effectively into the omnichannel era.
You want to make sure that you can tick off a lot of these requirements before launching into your omnichannel strategy.
Going omnichannel requires businesses to take a customer-centric approach.
But when you’re putting the customer first, there are many things you need to take into account.
You’re looking at where consumers want to buy, what research they would conduct before purchasing, what devices they use, and which platforms they prefer.
These factors influence many departments. Examples include marketing, logistics, and customer service.
Here we’re going to discuss the key steps you need to take into account when launching into your omnichannel strategy.
- Understand your customers
To start your omnichannel strategy, you need to have a high-level, big picture and holistic understanding of your customers.
You need to understand your customers’ journey and all the touchpoints that go through, before and after the purchase.
Having a better understanding of your customers will allow better customer service, improved customer retention, and an increase in overall customer lifetime value.
In fact, customers who receive omnichannel marketing spend an extra 10% on online purchases, and 4% more in-store.
- Improve the Quality of Product Information
An omnichannel experience allows customers to purchase products from a variety of different channels on many devices.
To achieve this, you will need to manage and maintain product information across all channels.
Product information is what customers assess before making a purchase.
The product information must be complete, accurate, and relevant across all channels, or else customers will start to question the nature of the data.
Consistent, clear product information across all channels will allow consumers to trust your company.
The more they trust you, the more they will be willing to buy, and the bigger their customer lifetime value will be.
- Boost Inventory Visibility
By allowing customers to purchase from many channels, you will need to ensure that everyone in the company is willing to collaborate and work effectively together to communicate inventory status in real-time.
This can be quite tricky if your brand has many channels and an extensive list of products.
While most companies operate off many databases, working off databases in silos are difficult and will hurt your omnichannel strategy.
If a customer ordered a pair of black pants online because the inventory on the website said there was still many available, the customer would be expecting your company to deliver the pants in the next few days.
But, let’s say you’ve run out of inventory, and you only noticed this after a few days because you forgot to check your online purchases and just sold the last 3 pants in store. If you inform your customer, they would be disappointed and may choose not to purchase from you again.
Having a clear inventory list is so important because, if you fail to fulfill customer orders, 50% of customers won’t hesitate to switch brands because you have been unable to meet their needs.
So how do you solve this problem?
Companies should have several databases that are connected and synced together, so everyone on the team can receive real-time updates.
- Manage pricing and promotions across platforms
While there are many ways to price, it’s best to keep pricing consistent across the different platforms.
Pricing was once channel-specific.
But we’ve gone a very long way.
With pricing becoming more transparent over the years, customers prefer consistent pricing over different channels as it provides a more seamless and integrated user experience.
- Provide a connected customer service experience
A unified customer service experience is critical for any omnichannel strategy.
The customer should receive the same level and type of assistance across all the different channels.
While an omni channel experience allows you to communicate with your customers across different platforms, this can be very complicated because you will need to set up the appropriate customer service support systems for each platform.
You need to be present on all channels during times of convenience for the customer.
We recommend providing a self-help page, where customers can try to solve their problems. You will still need to have customer support staff on hand for consumers who do decide to reach out.
A help or a FAQs page is a great way to start. Helping customers help themselves is a fantastic way to reduce time and cost in your business, while still achieving the omnichannel experience.
Creating an omnichannel brand will not be an easy task.
But it’s become an expectation from the modern day consumer.
45% of consumers believe retailers are not delivering multi channel experiences quick enough, even though 42% of retail executives spend up to 50% of their marketing budget on omni channel initiatives.
Although transitioning to an omnichannel strategy requires a lot of stakeholder involvement, we hope that by giving you this Survival Guide, you can recognize the importance of omnichannel strategies in today’s retail environment.
In this guide, we explored the changes in consumer behavior, the importance of an omnichannel experience, and how the consumer demands for an omnichannel approach are still growing and changing today.
But what we want you to walk away with, are the implementations of an omnichannel strategy from Disney and Oasis, and the practical ways your organization can transition to an omnichannel experience.
While an omni channel strategy is complex, we recommend you start today.
Build the foundation and talk to key stakeholders in each department.
It’s one of the best investments you can make that contribute to the company’s longevity and mid-to-long term success.
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