Omnichannel isn’t some new cable network that involves flicking through the TV channels. Although maybe there should be a channel like that, one where business owners could watch to learn all about omnichannel retailing. It would probably feature reality shows like Keeping Up with the Small Business Owners!
Omnichannel is a retail sales strategy that aligns with the way today’s customers do their shopping. It’s an approach to growing your business by engaging your consumers on multiple fronts while providing them with a seamless shopping experience.
You may be hearing through the retail grapevine that brick-and-mortar will soon be a thing of the past and that online is the place to be. The reality is that neither is true. In-store and online shopping are both here to stay for a very long time. This is because consumers will always want to be able to purchase in multiple ways.
If you’re still not convinced, consider this: 15 years ago, the average consumer typically used two touchpoints when buying an item, and only 7% regularly used more than four. Today, consumers use an average of almost six touch-points, with nearly 50% regularly using more than four.
1. What that mouthful of letters really means
Omnichannel retailing is an integrated approach to selling that enables customers to browse, shop, and purchase through various channels, such as a brick-and-mortar store, social media, website, and mobile.
On the other hand, there’s multichannel retailing, which is similar yet different. The multichannel approach can utilize the same channels but lacks the true integration of omnichannel. For example, a multichannel brand can have both a website and a brick-and-mortar store. The difference is that customers who buy items on the website can only return through the website, not the store, or vice versa.
Putting ‘omni’ before any word makes it mean universal. So, when we say omnichannel we are referring to a holistic and integrated strategy versus multichannel which is much more fragmented. You may be doing some version of omnichannel or multichannel or an overlap of the two in your own business. Putting a name on it will help to define what it is you’re doing and provide a way to evaluate your strategy.
2. The benefits of an omnichannel retail approach
According to a report from IDC Retail Insights, businesses that employ an omnichannel strategy report a 15% to 35% increase in average transaction size, plus a 30% higher lifetime value than those who shop using only one channel. There’s no question that omnichannel retail is effective, but you must decide if it’s the right fit for your business.
Here are some considerations for moving towards an omnichannel retail approach:
- Do you want to offer your customers more access? Providing additional opportunities to buy your products and services equals more sales. A brick-and-mortar store is limited to certain business hours versus an online store that is open 24/7.
- Do you want to provide a seamless shopping experience? Omnichannel retail removes many of the obstacles on the customer’s path to purchase. Curbside pickup or in-store returns offers your shoppers convenience options.
- Do you want to improve customer service? Using a product such as SKU IQ syncs your Square Point of Sale and eCommerce system to streamline inventory management. This leads to better service by avoiding overselling or out-of-stock items.
3. The drawbacks of an omnichannel retail approach
Don’t think that omnichannel retail is all rainbows and sunshine. As mentioned with inventory management, you need to have suitable systems for your strategy to be successful. If your business isn’t capable, then customers will turn away in droves. In fact, 57% of online consumers would abandon their online purchase if they could not find a quick answer to their questions.
Here are some possible concerns about omnichannel retail to deliberate about:
- Do you want to deal with pushback from your sales staff? If you have an in-store staff that works on commission, they may see launching an eCommerce store as competition. They could pressure customers to purchase in your store versus shop online.
- Do you want to risk the possible loss of personalization? Sometimes the more touchpoints that a customer has, the easier it is for them to be overlooked in your sales system. For example, if you’ve built an in-store rapport with customers, it could be lost in an online world.
- Do you want stiffer competition? More sales channels mean more competitors because customers can buy a product anywhere. They can also pull out their phones right in your aisles and comparison shop.
4. Ensuring the success of your omnichannel retail strategy
One major sign of success with an omnichannel retail strategy is when your customers begin recognizing your brand at every interaction. This means the same service that customers receive in-store to online to other touchpoints is consistent and aligned.
These are some best practices to ensure your business’s victory in omnichannel retail:
- Roll out omnichannel practices gradually: This gives you the space to test out updated systems and gives your customers time to adjust.
- Review the new sales strategies with your staff: Educate them and answer any questions so they can provide exceptional service to your customers.
- Remember to always keep your customer at the center: Leverage insights from your Square Point of Sale customer data to provide an ongoing, customized experience.
We’ve covered brick-and-mortar and eCommerce sales in detail, but your omnichannel strategy should also extend to other relevant channels. Think about how you can use your social media, mobile, or loyalty program to create new buying experiences for your customers. Also, consider if your delivery, curbside pickup, and return options are up to par.
Just like flicking through the TV channels, you try different channel options until you find the right channels that work for your omnichannel retail strategy. And when you do, you’ll find that your business will broadcast nothing but success!
