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Don’t frustrate customers, deliver ‘omni-channel’ retailing, forum told

Customers are increasingly interacting with retailers through multiple ‘channels’ as part of a single transaction. Retailers that fail to offer a superior shopping experience, where their customers can move seamlessly between different channels, risk becoming obsolete, industry experts warned a recent forum’s attendees.

Held at Sydney’s Radisson Blu Plaza Hotel on Wednesday, 18 May, the Retail and Security Press Forum was moderated by Frost & Sullivan’s ANZ managing director, Mark Dougan. It featured a panel of industry experts, including Mark McGeachen, CEO of AdvanceRetail Technology.

Multiple channels to a single transaction

Dougan provided insight into the evolution of the retail industry, focusing on the increasing importance of ‘omni-channel retailing’.

“Omni-channel is the general trend towards the use of multiple channels by consumers often as part of a single transaction with a retailer,” Dougan explained.

“Consumers may, for example, use a mobile device to research a product, the product’s in-store availability and a retailer’s opening hours. Alternatively, they may visit a store to look at product but then place an order online. They may place the order online, go to the store and collect. The key aspect of omni-channel for retailers is to operate in an integrated and seamless fashion.”

Integrate channels or frustrate customers

Dougan told attendees that while many retailers initially operated their online stores as stand-alone businesses, separate from their brick-and-mortar stores, this approach has become increasingly unviable.

He explained that customers now expect a seamless and fully-integrated omni-channel experience from retailers – anything less will leave customers frustrated.

McGeachen agreed, explaining that retailers can no longer afford to treat their different channels as information silos because customers expect to “start a journey in one channel, move to another, shift to a third and come back to the first – all as part of a seamless shopping journey.”

Get personal, go mobile

While ‘click and collect’ is a feature of omni-channel retailing, McGeachen warned retailers not to confuse the two because ‘click-and-collect’ on its own does not offer customers a seamless cross-channel shopping experience.

McGeachen also spoke about the increasing importance of retailers collecting customer data through their loyalty and CRM programs, explaining that delivering a personalised shopping experience is necessary for retailers to grow and survive.

In addition, McGeachen said the idea of omni-channel retailing continues to evolve. For instance, the growth in mobile shopping, which has been met, in some instances, by a decline in people shopping on their computers, is having an effect.

“Omni-channel is not necessarily that seamless experience of sitting at home, clicking on your pc and walking into a shop; Instead, you might be on the road, in the mall, on your mobile device,” he explained.

Three trends retailers need to consider

McGeachen highlighted trends that could adversely affect retailers who don’t offer a seamless, fully-integrated omni-channel service. Here are a few:

  • New ways of socialising: McGeachen said US holiday shopping statistics, unveiled by the National Retail Federation in January, will alarm brick-and-mortar retailers. They show a 50% decline in mall visits over the past four years. Noting that malls (at least in America) were traditionally social spaces, McGeachen speculated that ‘hanging out’ at the mall may have become less relevant due to the impact social media is having on the way people interact.
  • Showrooming and webrooming: While physical stores have become showrooms for online retailers, McGeachen said brick-and-mortar retailers have been able to fight back with the emergence of ‘webrooming’. This is where customers conduct product research, including price-comparisons, using online retailers’ websites but visit a brick-and-mortar store to experience and buy a product.
  • The threat of pure-plays: Some pure-plays (retailers that operate only online) are realising the limits of what they can achieve online, according to McGeachen. In order to grow, they have embraced ‘experiential shopping’ and opened brick-and-mortar stores, where people can ‘experience’ a product or service. This is a threat to existing brick-and-mortar retailers.

Small retailers have a competitive advantage 

In a post-forum discussion with Dynamic Business, McGeachen explained that omni-channel retailing is a feasible and attractive business model regardless of a retailer’s size. 

“Size isn’t a barrier to small, single store retailers offering customers an omni-channel service,” he said.

“For big retailers, change is something you do very cautiously, whereas small retailers are able to use their agility as a competitive advantage. Smaller retailers are in a position to launch an omni-channel service quickly, trial it, adapt it and fine tune it with a rapidity that larger businesses cannot hope to emulate.

“Most retailers need to operate in both the online and brick-and-mortar worlds – and small business are no exception. The reputation and audience a small business builds online can extend their customer base greatly beyond what their physical presence might suggest. Offering customers the ability to shop seamlessly online and in-store is certainly ‘do-able’ for a small retailer.”

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James Harkness

James Harkness

James Harnkess previous editor at Dynamic Business

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