Right now, retailers everywhere are rapidly pedalling underwater to embrace the 'new normal'. Predicting fast-changing consumer habits and expectations is more than a sport; it's a necessary obsession.
And although talk of multichannel and omnichannel retailing is constant, the hot topic for 2022 is embracing omnichannel retail — and the powerful, lucrative advantages it can deliver you.
Today's new consumers behave and buy differently. They are tech-savvy, multichannel shoppers who demand a highly personalised, seamless shopping experience. But this doesn’t mean multichannel is enough.
When comparing multichannel and omnichannel retail, there’s a vital consideration. Although both offer a multichannel solution, only one provides that Holy Grail of customer experiences.
Why today's customers will be demanding an omnichannel experience from you
Today's customers want— or even demand an omnichannel experience — a connected, seamless experience where the customers' needs come first.
According to KPMG’s Australian Retail Outlook 2021, this Covid-driven shift in consumer behaviour has turbo-charged the need for ANZ retailers to catch up to the rest of the world in terms of delivering a rewarding omnichannel experience.
And this shift is permanent. After tasting the fruits of online shopping convenience during Covid lockdowns, Aussie and Kiwi shoppers are in no hurry to give it away. But that’s not all. They want to use your online presence as an information centre to research and plan, not just for immediate sales.
These customers also want to know if stock is available in a nearby store. And they want to secure their order online with Click and Collect if they choose. Because customers now want delivery options and delivery speed.
Today’s shoppers still want to visit a physical store when it suits. But again, their expectations and objectives are different. They may want to test or try products, return goods, experience the brand or visit the store for social reasons.
Big brands like Nike (yet again) have gone one step further and are kicking goals satisfying these customer aspirations.
As Future Stores explains, “Nike’s new store offers experiences that consumers simply can’t get online, such as testing out new products in real sport play (such as in-store basketball courts and treadmills — tightly monitored by multiple video cameras recording sports performance or gait) before buying.”
Consumers now want it all. And big brands are delivering. But smaller brands must also adapt and go omnichannel if they want to survive. You don't have to be a multinational brand to keep up.
Let’s take a look at what the average Aussie and Kiwi retailer can do. (Because there’s a lot of possibility.)
Get inside the heads of today’s new consumer
To keep up with this (rather demanding) new consumer, you need a retail channels strategy. But to understand the importance of all this, you must get inside the heads of today’s new consumers. Then, you'll appreciate the enormous rewards of adapting your business to deliver the omnichannel customer experience.
To keep up with this new consumer, you must have a retail channels strategy. But most importantly, you must get inside the heads of today’s new consumers. Only then can you appreciate the enormous rewards of the omnichannel customer experience.
Multichannel & omnichannel retailing: what’s the difference?
Both multichannel and omnichannel offer multiple channels, and both are good for driving more sales. However, the operation is entirely different for the consumer — and that’s the significant bit.
Technically, the difference between omnichannel and multichannel retailing is in the integration. Everything is linked. But let’s look at it more in psychological terms — how the customer sees it.
- Multichannel starts with the company: The company comes first, then offers various channels for the customer to choose from. There’s no one perfect solution, just options.
(Read: “Customers, we’ve done our best and have given you a range of options; choose what you can. But management says certain things aren’t possible.)
- Omnichannel starts with the customer: The customer comes first and is the centre of all operations; they can choose any channel and be assured of a seamless experience as all channels are interconnected.
(Read: “Customers, welcome! Do as you please. Engage with us on any channel. We have your details and history, so we know where you’re at, and there’s no need to repeat yourself.”)
Both omnichannel and multichannel have potential, but the real potential lies in deeply integrating these channels to create an omnichannel retail strategy. And this is now vital.
New research by IAB Australia and Pureprofile confirms the message on every retail expert’s lips: “Marketers will need to shift gears into 2022 to ensure they provide a satisfying omnichannel shopping experience amidst escalating consumer expectations.”
Advantages of omnichannel over multichannel retailing{Powerful advantages of omnichannel over multichannel retailing}
Once you integrate your channels properly with an eCommerce and omnichannel POS system, endless profit-generating benefits can be revealed, such as:
1. Increased efficiencies
Unlike multichannel, omnichannel integrates everything. So your business can dramatically save on administrative expenses. For example, a customers’ details need only be recorded once. Automation makes light work of tasks that could have taken hours or days to complete. Manual stock updates have become a thing of the past. Reporting on any part of the business is next-level. The result? More time for increased productivity.
2. Make stock availability great(er) again!
Stock availability was a painfully sore point for many retailers during the pandemic. So you must win back customers and prove to them that you have plentiful supplies by displaying all available stock. Do this by integrating all orders and stock and offering a complete overview of your inventory, and you’ll sell more (and increase foot traffic), too. Omnichannel optimises your chance for success, while multichannel presents the same old stock limitation problems as before.
3. Improved customer experience
When you put the customer first, they’re more likely to have a positive customer experience and feel positively towards the brand (who knew?). Such positivity makes them loyal and improves your branding.
So, what type of positive customer experiences are we talking about? There are many.
The customer can quickly establish a personal profile with the brand, check their order history, receive loyalty points, and receive email and Facebook marketing material relevant to the customer (due to their preferences and past shopping history data).
The customer can now also enjoy ultimate shopping freedom. They can see full stock availability, purchase online, choose where the goods are delivered or returned and much more.
In essence, the customer is no longer a second-class citizen that must oblige with stifling and outdated retail business rules — as is the case with multichannel retail. Things are different now; it’s all about the customer. But omnichannel is also about playing the long game, winning over the customer for life. For many leading retailers, improving lifetime customer value is reason enough to embrace this strategy.
4. Profit through more sales
According to a study by Harvard Business Review, omnichannel customers spend 10 per cent more online and 4 per cent more in-store than single-channel consumers. However, specific retail sectors benefit much more. For example, omnichannel grocery benefits dramatically.
New research by SymphonyRetailAI — analysing shopper data from 421,000,000 baskets in the US and Europe — found that omnichannel grocery shoppers spent on average 20 per cent more and shopped more frequently than those that just visit the store.
The message is clear: omnichannel boosts branding and loyalty, so customers will like and trust you more, stay with you longer and spend more.
5. Reach new customer segments
By opening more channels and integrating your bricks with clicks, you open your store to more customers and increased sales. Of course, multichannel retail allows you to reach more customers, too. But, those new customer interactions are limited, though, due to a lack of integrated (and hence visible) data.
6. Centralised data collection & reporting
Link all channels and centralise your data, and the world of data collection and reporting gets a whole lot better. Say goodbye to Excel spreadsheets and hours of manual updates. With the right omnichannel POS software, this is done for you. You can make informed business decisions to drive revenue and increase profit margins — all while freeing up valuable time.
You’ll get in-depth, actual insights into your business with insightful analytics covering reports on sales performance, customer analytics, suppliers, inventory, products, supply chain, financial reports and online and in-store performance. Once again, these possibilities are just not available with a multichannel system.
7. More (and faster) delivery options
With omnichannel retail, customers can look for their desired product on the day, find a store displaying available stock and choose Click and Collect. If they order online, Ship from Store makes faster delivery possible. None of these delivery benefits are possible with multichannel. And right now, delivery is under the spotlight.
According to a survey of retail professionals by Australian Retail Outlook 2021, when retailers were asked what consumer expectations would likely increase over the next 12 months, most retailers believed consumers would demand more regarding delivery.
35.07% believed customers will expect more from online delivery options, and 44.55% thought customers will expect more in terms of online delivery speed.
8. Be ready for anything
If (or when) the world throws more surprises at us, you’ll be more readily equipped. If physical retail shopping is prohibited, customers can shop online. If there’s a mandated limit on indoor shoppers, store-side pickup or Click and Collect is available. Keen to increase communications with your customers during challenging times? Targeted marketing, email and social media campaigns make this possible — now that you have your customers’ data. Although multichannel gives you the protection of both bricks and clicks, the lack of integration will thwart your potential.
Omnichannel retailing: key features{Omnichannel retail features — see the physical and technical details that transform your retail business}
Keen to know the physical, technical details of an omnichannel retailing solution? Here’s a glimpse of what your retail business could look like:
- Complete visibility of supply chain and stock fulfilment - opening up the powerful potential for increased sales through better inventory management
- Cloud-based Point of Sale solution - offering watertight security and real-time updates (NB: Retail Express' POS software has an offline mode that allows you to keep taking sales even when the internet is down.)
- Automated sales, store & supplier reporting - no more wasted time and income-generating expensive, time-consuming reports
- Targeted email & SMS campaigns – forget cold, all-encompassing email campaigns. Now you can give them personalised emails explicitly targeted to your customers' preferences
- Accounting & ERP system integration – automation eliminates errors and saves time and money on admin fees
- Smart marketing, loyalty and sales programs - all marketing and rewards programs can be integrated both on and offline, boosting sales
- Integrated business apps – by integrating with other leading business software, you remove double handling and errors, which saves you time
How to make omnichannel retailing work for you
To make omnichannel retailing a success for your business, it’s vital you choose the right POS software. Look for a software system that doesn’t just support an omnichannel strategy — or offer vague promises of ‘integration’ but has the technical depth required. It should be secure, cloud-based, agile, and have POS eCommerce integration capabilities to handle complexity.
Be aware of the multitude of cheap POS systems on the market, too. These systems are best suited to small online-only or single-store 'cash and carry' retailers with only a few products.
If you seriously plan to move to omnichannel and expand, choose powerful software with the functionality and POS eCommerce integration capabilities that can handle complexity.
Retail Express was created for retailers, by retailers, in 2006. The world’s first cloud retail management system, Retail Express has helped drive over $50 bn in Australian and New Zealand retail sales and build industry expertise that is second to none.
Unlike others in the market, we carefully choose employees with real experience in retail – not just IT. This means we speak your language and know first-hand the complexities of running a retail business.
It’s our job to make your migration a success
We believe that migrating to a new software should not mean putting your business on hold or enduring weeks of headaches. It’s our job to help make your migration a success, so we’ll do the heavy lifting for you.
Each new client gets a personal Success Manager who will remotely guide them through their set-up and adoption process. Afterwards, clients can contact the Australian-based customer support team via phone or email.
