Online sales are booming. Yet, according to a recent study by Harvard Business Review, only about 7% of consumers shop exclusively online. That must mean that despite consumers’ propensity for online shopping, most shoppers still favor brick and mortar stores, right? Not so. Just 20% of customers are store-only shoppers. The remaining 73% use multiple channels during their purchase process. They’re known as omnichannel customers.
Just think about it: How often do you buy a product or service on the spur of the moment? If you’re anything like most people, you probably like to do your homework before you make a purchase. Indeed, an average customer requires six to eight “touches” or marketing messages (be it an ad or a blog post) before they’re ready to commit to your offering. That’s where omnichannel retail strategy comes in.
What Is Omnichannel Retail?
Simply put, omnichannel retail is a multichannel sales approach (i.e., it involves using a variety of channels to connect with your audience). However, whereas multichannel is product-centric, omnichannel is all about the user experience.
A retailer might have a well-designed website, engaging social media campaigns, and a busy brick and mortar store. But if these don’t work well together (like if the overall brand message isn’t consistent across all channels), then customers are not getting that seamless shopping experience they crave. And that’s a problem.
Today’s consumers expect to interact with a company not only whenever they want but also however they want. Yet 55% of shoppers feel that retail experiences are disconnected across different channels. By unifying online and offline channels, an omnichannel strategy can provide your customers with a smooth and uninterrupted shopping experience — regardless of whether they shop online from a mobile device, on the phone, or in a physical store.
For example, with an omnichannel system, a customer might receive an email with a discount after they browse at your eCommerce store. Or, they might decide to check the real-time inventory at their nearest brick and mortar store via a mobile app (39% of customers are unlikely to visit a physical store if it doesn’t have physical store inventory information online). Or, they might choose to place an order online but pick it up at their preferred location (and therefore potentially spend more — consumers who conduct prior online research on the retailer’s site spend 13% more than those who don’t). The list goes on and on.
Why Brands Must Go Omnichannel
Most customers would pay up to 25% more for products and services if it meant a better customer experience. That’s impressive. But the benefits of transitioning to omnichannel retailing don’t end there.
On average, omnichannel customers spend 4% more when on a shopping spree at a physical store and 10% more online than single-channel customers. Moreover, the more channels customers use, the more they’re willing to splurge. Customers that use four or more channels spend 9% more than those who use just one channel.
That makes sense. When you deliver the same message across different channels, you increase the feeling of familiarity that customers have with your brand. Perhaps that’s why companies with strong omnichannel engagement have an 89% customer retention rating, compared with a 33% rating for businesses with a poor omnichannel strategy.
How to Develop an Omnichannel Retail Strategy
Omnichannel retail doesn’t mean that you have to be everywhere. Two or three channels with substantial engagement are always better than ten underperforming channels. Therefore, the first step in developing an omnichannel retail strategy is figuring out your customers’ journey across multiple channels and devices.
No matter where your customers are, they should be able to go from product discovery to conversion instantaneously. Before they can do that, though, you need to sync your products across different sales channels.
For example, if a customer finds out about your product or service while scrolling through Facebook on their phone, they might not want to, or be able to, to go to your site to make a purchase, especially if it means hopping onto their laptop. But if you’ve enabled shoppable posts, they won’t have to. Similarly, if a customer adds an item to their cart while on their phone, the product or service should still be there when they log in via their desktop.
Make sure that all departments within your company are involved in crafting the perfect omnichannel strategy. After all, every team member, from marketers to customer service representatives, can use customer data to improve the overall shopping experience.
The Future of Omnichannel Retailing
The reality is that customers have come to expect an omnichannel experience. Savvy marketers know this. As many as 42% of retail executives spend up to half of their marketing budget on omnichannel marketing initiatives. Their efforts typically more than pay off.
Businesses that adopt omnichannel strategies have 91% greater year-over-year customer retention rates than those that don’t. Moreover, they see an almost 10% year-over-year increase in annual revenue versus 3.4% for companies with weak omnichannel presence. If you want your business to succeed, investing in an omnichannel system is the way to go.
Laura Martisiute is a freelance writer with Optimist. She’s a content marketing specialist with years of experience diving deep into the latest research on technology, business, and marketing.