Why Businesses Today Need to Adopt Omnichannel Retailing?
The retail industry is constantly evolving. Today, most major retailers have recognised that the industry has become increasingly competitive, partially owing to technological disruptions, demanding consumers, and a general shift in purchasing behaviour. Retailers who are not able to adapt and respond adequately to these challenges are finding it increasingly challenging to both thrive and survive in the industry.
The businesses that are able to make most of the situation and thrive, are laying down the foundation of modern retail supply chains and even more importantly, utilising omnichannel retail tactics. Omnichannel retailing permits retailers to achieve much more availability, driving sales and traffic and integrating their touchpoints.
Research has shown that omnichannel customers end up spending almost 15 to 30% more than single or multiple customers. Another study by Google also found that 75% of customers are more likely to visit the store if they come across local retail information regarding it on the web. Additionally, businesses that have adopted omnichannel retail strategy are achieving 91% greater year-over-year customer retention rates as compared to the companies that haven't.
It is easy to see that omnichannel retailing benefits both customers and retailers; if you're still wondering how, here are some of the benefits:
- Reduction in Inventory Costs: Since Data across various channels is synchronised in omnichannel retailing, it is easier for retailers to handle orders much faster. Utilising the right omnichannel retail software solutions can help in saving both energy and time that would have otherwise been wasted on warehousing and staffing. Thus, retail managers can do their job much more efficiently and faster.
- Greater Efficiency: Enabling the customers to view products and experience branding consistently across all retail channels, helps in saving time by enabling customers to make their purchases. Since this retail system is more customer-centric, hence it brings about better efficiency in leading customers to make favourable purchasing decisions.
- Increased Brand Perception: There is a monumental amount of attention that needs to be paid to customers equally across channels available. This helps in increasing brand perception and converts your target audience into loyal, returning customers.
- Higher Sales: Enabling retailers to review their sales data aids in the identification of consumers' favoured channels, which can be leveraged for reaching out and creating targeted campaigns. When customers are introduced to a wide variety of products via their favourite channels, it increases the purchasing opportunities for the products.
- Better Margins: Omnichannel retailing can help retailers in selling products across the country for full price without having to offer any discounts. This, of course, helps them in gaining higher margins.
- Enhanced Productivity: When customers can research online and buy whatever product they are looking for through all the channels offered, it helps in increasing the productivity of the retail system at large and also improves customer retention.
Where is Omnichannel Retail Heading?
- Retail Becomes Irrevocably Phygital: Consumers' expectations have become much more demanding.This is owing to the disruption caused by larger retailers and also the pandemic, both of which have played their part. Customers now want choice, agility, consistency and personalisation, this is the reason why retail has now become Phygital (Physical +Digital) and there is really no turning back. While earlier it used to be about getting the best price, it is now no longer that. It has also become about the consumer experience where time has also become a valued commodity. Thus total transformation digitally to keep up with omnichannel retailing is now the norm when it comes to pre-sales as well as service.
- Seamless Experiences Impacting the Revenue: According to a study by Google, omnichannel shoppers have a 30% higher lifetime value than those who shop only using one channel. Today, shoppers or shopping both online as well as at physical stores, more than ever; the companies that understand this are enabling their customers, putting them at the centre and facilitating this. One cannot deny the fact that the pandemic has taught everyone to shop more efficiently, hence physical retailers who used to previously focus on operational efficiency cannot hold in today's world. This is why omnichannel retail has become so much more important.
- Keeping Up with Changing Consumer Base: One of the most important strategies at this point in time for businesses is to take out the stress from the shopping experience, which is the future of omnichannel retailing. As customers ask questions about what is a smart use of their money and time, convenience would become the context. When you look at the younger shoppers, they have a strong set of values regarding society community and also the companies that engage with, consumers today has a becoming much more conscious of the global impact of the purchasing choices and thus this gives rise to the role of trust for businesses.
Ultimately, caring is going to become the new KPI for the future of omnichannel retailing, which would include everything from remembering the shopper to understanding the needs and services provided. If you look at metrics, ROI has had its shine, it is now going to turn into ROE or Return on Engagement, which is going to shift the focus on what do you receive in return for the time and resources that you have invested in engaging your customers across multiple channels, apart from just monetary investments.
Omnichannel retailing experience has become inarguably one of the most popular trends for businesses today as innumerable companies or walking along these lines. Customers today are looking for a seamless omnichannel shopping experience. Hence, retailers need to adapt to these evolving consumers' needs and behaviours and recalibrate their understanding of the target audience. For a business, it is essential to have an omnichannel strategy that is holistic and comprehensive and is supported by the four strong pillars of any retail business, namely sales channels, marketing, operations and fulfilment.
Conglomerates across verticals like Walmart, Disney, Starbucks, IKEA, Adidas, Sephora, Pepperfry etc. have employed omnichannel strategies that help them in understanding their consumers on a broader level, owing to the customer-centric approach. With the option of streamlining and optimising the shopping behaviour of consumers, omnichannel retailing definitely is the way forward. Thus, It is only fitting to say that going the omnichannel way is the only method by which a company can address the rising complexities in today's market while managing operations costs and providing an excellent customer experience.