How omnichannel can rescue retailers in a mid and post-pandemic world : Part 1

Creating a connected, seamless experience across channels is not revolutionary anymore. What’s changed is the world around us an, in turn, the definition of value to customers and business alike. Shopping behaviours are changing faster than ever before, and pockets of potential value are emerging in unseen areas. This rate of unpredictable change throughout COVID-19 has triggered businesses of all sizes to rethink the service they offer.

From top- level leadership down to delivery and execution roles, understanding the potential of omnichannel can impact the decisions made at every level. From the overarching strategic direction down to how business silos work together, omnichannel is a concept that brings an entire business together to tackle a problem. Understanding the intricacies behind delivering omnichannel correctly is what will set businesses apart from its’ competitors in this new dynamic world.

1. What do we mean by omnichannel?

Whilst omnichannel has been standard terminology for a while, the interpretation of it is varied. Many think that being present in lots of channels ticks the omnichannel box. But having a consumer tech team, a digital ops team, CRM (to name but a few) does not always translate into an omnichannel customer experience.

“Omnichannel is about how well integrated and orchestrated your channels, and their supporting systems, are to deliver a seamlessly connected end-to-end journey for customers and employees across all touchpoints”

Take, for example, online order confirmation email, every business has to send one by law as standard practice. Smart omnichannel is when this email takes the data from all the past interactions and uses it to help the next. Argos have nailed this through their effortless online to in-store to SMS and email journey. They automate where possible and they provide detailed accurate information to manage expectations along every step. They create a 360 degree view of the customer, which then predicts the customers next steps and actions, enabling Argos to extend a one-off journey into a never-ending customer cycle.

It’s uniqueness comes with it’s “omni” to mean “combining” or “all”. In a customer-centred business every business function must be contributing to an identified customer need and leveraging one another to service that need. Breaking down traditional business silos is difficult but the drive comes for the vast value omnichannel delivers. Here are they key KPls that have evolved in the omnichannel business case over the last 20 years:

• Revenue- Omnichannel is not just about consistency and availability, but about expanding brand footprint by connecting experiences online and in retail stores. According to Mulesoft, omnichannel customers spend 15 to 30 percent more than single or multichannel customers. IKEA leverages its online channels to inspire and inform customers while driving footfall in-stores where their brand affinity strengthens and basket sizes increase, contributing to IKEA’s reported $40 billion in revenue last year .
• Net Promoter Score- The drive to elevate shopping experiences has been largely demand-led. The “Amazon effect” has sent expectations soaring as a staggering 9 out of l0 customers state they expect a retailer to provide seamless omnichannel experiences. When Bonobos added an extra step for customers in their shipping process, they noticed their NPS scores decline and in use that customer data to rectify the issue.
• Loyalty & Retention- Internet Retailer found that organizations with strong omnichannel strategies have a retention rate of 89 percent. compared with 33 percent for those with weaker strategies. This is because omnichannel is key to collecting customer data. Nestle tapped into Tesco’s loyalty scheme, tracking users online and in-store behaviours. The holistic view enables Nestle to deliver personalised marketing via their opp and in-store digital signage. This reached 5.8 million customers and drove an 11 percent increase in sales.
• Cost savings & operational efficiency- Although omnichannel can be a large investment, the synergies that occur between channels can cut costs in the long run. Strong omnichannel companies see a 7.5 percent year-over-year decrease in cost per contact. Walmart leverages their opp to help consumers build grocery lists and manage their shopping cart from their mobile device; this lessens the pressure on store staff and allows for a seamless transition from online ordering to in-store pickup.

2. Why is omnichannel so important right now?

Whilst the above KPls are still critical business drivers, the way in which to achieve them has drastically changed. Throughout the industrial and technological revolution, the rate of change is now exponential. The film, Back to The Future Part II, made then farfetched predictions about 2015 that have since come true- robotics, biometrics and Google-Glass style eyewear to name but a few. The realisation that we are living in this futuristic reality proved that the world changes rapidly and unpredictably.

And no more so than in 2020. The pandemic hit hard around March as we saw stores shut, employees furloughed and economies turn to crises. In the UK alone, store footfall dropped by 78 percent and Adobe saw a 33 percent increa se in demand for smart ecommerce tools

as omnichannel interactions supersede face-to-face. Since then, retailers and businesses have been forced to respond, some quicker than others, some much more innovative than others. Here are some examples of the new omnichannel solutions delivered to market that hit the new customer needs on the head:

• Online fulfilment - Online shopping surged by 129 percent across Europe, and both digital natives and immigrants expected the Amazon effect. COVID saw delivery timelines on average reduce from 2.1 days to 1.7 days. Whilst the crux of this issue lay with supply chain and fulfilment suppliers, some retailers tackled this through their online experience. UK government helped aggregated customer data to assist retailers in detecting high priority customers whilst Amazon put the ask on the customer, offering incentives for a de-prioritised delivery.

• Click & Collect - Since shops reopened, some customers are keen to get back in store but reduce their time spent there. 80 percent of UK retailers now have a Click & Collect service, a jump of 32 percent since last year. Pandora’s Click & Collect is integrated with it’s appointment booking and virtual queueing whereby you can state your reason for visit is to collect an order and the order is prepared whilst in the queue making the time in store much more efficient.

• Virtual Queueing - When stores reopened, the rate of increase in footfall surged each week due to pent up demand. Stores have had to balance the new influx of traffic with social distancing measures, which has seen the boom of a variety of out­ of-the-box virtual queueing systems. QR codes are everywhere since COVID, from retailers to bars and restaurants, it’s becoming a customer norm to point your camera at it and be directed onto the next step. Asda collaborated with Quidini to use geo-location, eliminating the need to go up to the store to join the virtual queue; they are targeted with a notification as soon as they drove into the carpark

• Stock indicators- There’s been a clear trend in customers pre-planning their store visits to be as fruitful and as safe as possible. IKEA have seen this with via their stock checker tool. Other retailers have also used stock indicators when unable to roll out a full Click & Collect service due to vast investment or stock management accuracy.

• Store busyness indicators- Whilst customers are now increasingly checking what stock is in their preferred store, they are now checking what people, to be able to avoid crowds. Demand has increased in AI tools to proactively monitor store capacity and similarly some retailers are posting this information online to better serve their customers. Philips, xplace and Alpha bird have developed AI sensors that detect the number of customers walking through a shop’s doors and display that information on a digital sign outside. Similarly, apps like Supermarket check in gathers data on both the store’s busyness and the stock levels across different retailers to offer one view to users.

• Virtual chat- There’s a clear divide between customers wanting to go in store and customers’ completely avoiding it. A newer trend that has arisen post­ COVID is remote appointments and video calls. In an attempt to recreate as much of the store experience online, Curry’s partnered with GolnStore to offer a live video service to their store staff. Customers can discuss their needs in detail and take a closer look at products whilst the Store Associate can build their online cart for them. This saw a 94 percent customer satisfaction rate along with conversion rate and revenue per visit.

(To be Continued…)