The times of retailing were very simple – you open a store, source products, buy one, sell one …. and repeat
In the past couple of years, the land-grab for retail space dominated in terms of increasing store locations and developing an online presence. Similarly, the race to offer multi-channel retailing spiked, as the market leaders rushed to grab online market share, stumbling over each other to innovate and increase their offerings to customers. Which led to the proliferation of home delivery, click and collect and third-party omnichannel service providers. However, firms deliver these services at the cost if retail margin erosion and the proliferation of IT and operational complexity.
Moving forward, the bar has increased. Customer’s expectations are higher, constantly shifting and retailers are requesting technologies that more intuitive. Moreover, they drive additional value which is easy to manoeuvre online and offline across all platforms. The expectation for a seamless experience across all channels is driving the next revolution in business capabilities. Furthermore, putting a strain on retailers for profitable omnichannel growth. Retailers struggle to mature from multi-channel business models towards fully integrated omnichannel operations, where the sole base of the store. Moreover, retailers can manage online channels in an integrated seamless manner. As consumers begin to embrace the omnichannel offers at lightning speed – uncompromising expectations on quality, service, price and experiences follow, regardless of the channel.
A perfect storm is now driving the next revolution in retail, with the customer demands driving the need for a truly integrated operational and technology model. Moreover, the new business capabilities are suited for the sole purpose in the digital world. Today’s market witnesses most of the successful brands moving away from the traditional, score-based survey philosophy to viewing customer experience as an integrated process and driver of retail, cultural and operation change. In other words, its all about a complex process that starts by creating a culture of accountability. Moreover, it finishes with driving business results from a customer-centric operating model which delivers personalized data.
Consumers are steady-fast in the driving seat and will continue to embrace omnichannel retailing. Although the tipping point between in-store and online is increasingly reached, the store is not dead and it will always have a crucial role in satisfying the customer shopping experience. In other words, while the store still has an important role, with a volume of purchases still being made in-store, it’s the omnichannel experience that retailers are really being judged on. It is that connectivity and seamless experience across channels that is the real differentiator.
According to a survey, the use of mobile, including for payment, is accelerating at a stunning pace. The graph below shows the percentages of consumers shopping across the store and online channels. The survey highlights that for many retail categories, in the next five years the lines will switch and we’ll see the online channel dominate stores.
*online – Online refers to shopping via PC/tablet/mobile or wearable devices
The next decade is the golden age of the customer, with unmeasurable volumes of choices and control than ever before. Retailers will present customers with an evolving array of products and services – personalized to their specific needs and wants. In addition, customers will continue to demand price and quality transparency along with a wide range of options. Overall, the retail experience will become more inspirational, simple and convenient – on the whim of the consumer’s ever-changing need. Combined with transformative technological innovations, will continue to drive fundamental changes. The boundaries of “retailer” and “manufacturer” will continue to blur, as companies evolve to meet their customers’ needs.
By: Vic Bageria – June 28, 2017