“What is Omnichannel Strategy?” and “Are the benefits of omnichannel strategy worth my effort of building one?” are just 2 of many questions that retailers have while researching an omnichannel strategy for their business. This chapter will give you the key factors of an omnichannel tactic and guide you through the concept of building omnichannel architecture so that you can bring an omnichannel customer experience to your own retail.
RESPONDENTS IN DEVELOPED MARKET SAY IT'S IMPORTANT TO HAVE AN OMNICHANNEL STRATEGY
- Research from Consumer Goods Forum -
From the first and second parts of this Omnichannel Retail Guide, we offer you a great deal of precious information about omnichannel. Particularly, the definition, as well as its benefits, help businesses understand the true value to obtain from omnichannel.
In this third part, we will show you how to plan an omnichannel strategy for Magento retailers.
To help you take the root of the issue, here are some prominent ideas from previous sections.
Basically, the omnichannel platform aims at a seamless personalized customer experience anytime, anywhere on any device. Therefore, a retailer must ensure meeting customer expectations. That is also what customers expect.
Luckily, omnichannel architecture has a range of benefits to solve this problem. Particularly, it improves customer insight, strengthens customer loyalty and competitive differentiation; increases sales, expands the customer base, and boosts profit.
Omnichannel platform definitely helps deliver a more consistent customer experience across all channels while adoption of more channels will not do. Thus, the right strategy is the key to seeing the best results.
To acquire the maximum benefits of an omnichannel strategy and avoid unwanted objections during the process of implementing the omnichannel tactic, this chapter helps you resolve 3 questions:
Nowadays, customers expect to receive contextual information while shopping in-store. Thus, businesses decided to leverage mobile phones for real-time in-store communication with customers.
Research held by IDC has revealed the fact that:
Since many retailers have already understood their customers’ demand, they begin to make the first move in bringing omnichannel customer experience and use beacons to recognize customers when they step into the stores. This machine detects nearby smartphones and gives the staff information relating to those customers.
With beacons, advertisements, coupons, and supplementary product information can be transmitted to in-store screens located near the customer.
Retailers could also gain vital customer in-store information to deeply understand the maneuver through the stores.
Besides, in global omnichannel retail examples, there is another effective tool that some retailers recommend – RFID (Radio-frequency Identification Technology). We could take an example of RFID from London’s Regen Street opened in 2013.
They use (RFID) tags embedded into products, enabling the customer to view multimedia content via 100 digital mirrors and 500 loudspeakers in the store.
When customers hold the item near the mirror, it suddenly turned into a whole screen displaying information about the product.
Predominantly, retailers can take advantage of mobile devices to leverage revenue in-store as we mentioned above.
Besides, in case you want to maximize effectiveness, here is the tip you may want to know in planning an omnichannel strategy:
Through customer profiles and purchase histories gathered from a combination of sources, the retailers are able to send personalized promotional offers to potential consumers.
This is what is referred to as “on-the-go” promotions: Via a phone or a tablet Point of Sale app, and incentivized coupons that can be redeemed in store.
Moreover, they are also targeted to the location when customers come near the stores. After shoppers enter specific geofencing codes (pre-defined locations), the customer insights database triggers targeted offers. This action could increase the chance of getting the customer to visit the store.
If your business wants to get the status of multi-channel profitability, you should seriously consider integration and automation.
At the first glance, you may notice that cross-channel inventory visibility truly unlocks the key to a successful omnichannel retail system.
When you integrate both retail and wholesale channels in your omnichannel strategy, or systems and fulfillment centers, you can control your purchase orders, stock counts, sales data, and shipping fulfillment information from a single platform.
Moreover, if you are turning into new channels to create more innovative workflows and manage more complex systems, this level of visibility would be significantly important to your warehouse management.
It seems too easy to control and you, obviously, could reach that range of benefits as long as your omnichannel works successfully.
In addition, omnichannel visibility allows businesses to go beyond simply compiling data or producing reports.
It provides clear insights to help increase profit margins and accurately predict demand. The situation of being out-of-stock would no longer happen to your warehouses, as well, you do not need to overstock products to avoid the problem above.
Through centralized omnichannel inventory management, you can lower the amount of inventory you have on hand while increasing stock available to meet omnichannel demand and acquire higher benefits of an omnichannel strategy.
Countless retailers, both large and small, are still using outdated tracking methods to manage the 2 biggest assets: inventory and cash flow. Thus, this led to the inefficiencies and inconsistencies of these manuals.
The old system is seriously holding back the omnichannel potential.
How to implement an omnichannel strategy and resolve this issue? Automated operation is a great answer.
Nevertheless, you can boost productivity and stay competitive in a commerce landscape by automating key processes across your omnichannel platform.
In other words, automate operations can support retailers to manage effectively their system as part of an omnichannel strategy.
Inventory and cash flow would no longer be a terrible nightmare for business. All the management process becomes incredibly easy as well as efficient.
In addition, omnichannel visibility allows businesses to go beyond simply compiling data or producing reports. It provides clear insights to help increase profit margins and accurately predict demand. The situation of being out-of-stock would no longer happen to your warehouses, as well, you do not need to overstock products to avoid the problem above.
Through centralized omnichannel inventory management, you can lower the amount of inventory you have on hand while increasing stock available to meet omnichannel demand.
Initially, siloed system and inventory may work out for your organization.
However, they can quickly become detrimental due to the growth of your multi-channel performance.
As a result, it may lead to the problem of disparate systems, as well as inaccurate data. Besides, what’s more, destructive is the breakdown in cross-departmental communications.
To solve this problem, with an omnichannel strategy, retailers must integrate all the critical business technologies into a single operation and analytic omnichannel platform.
Having this centralized control platform will support you to synchronize all the retail and wholesale channels. The issue of improving data accuracy and visibility would be solved without delay.
Eventually, the seamless operation of your omnichannel architecture system is exactly what customers expect from you.
Thanks to the omnichannel strategy, that now, retailers can obtain this target easily and quickly.
Apart from how to plan a perfect omnichannel strategy for your own business, keeping your omnichannel tactic on track is another mindful issue.
Luckily, this problem has so many effective solutions to solve.
However, in the range of this Omnichannel Retail Guide, we just offer readers two prominent ways to make your own omnichannel strategy work productively as you want it to be.
At the conference of Magento Community called “Imagine 2016 – Breakout IV”, the staff who came from i95Dev – an eCommerce solutions company specializing in Magento, did have an impressive presentation about omnichannel success.
They point out 6 steps leading to the efficiency of an omnichannel strategy:
The pure meaning of the term “analytics” is an insight into customers’ behavior.
In order to deliver an omnichannel customer experience, the customer journey across physical and digital channels needs to be accurately mapped and analyzed to deliver a more personalized shopping experience.
It helps businesses target customers with the right marketing strategy based on where they are at in their buyer journey.
Moreover, analytics also helps to identify opportunities for up-selling and cross-selling and in identifying gaps in engagement (it predicts the trend in customer behavior). This can be achieved by a range of insightful sales reports.
In an omnichannel strategy, a product can reach its highest sales potential only when it leverages the right channel to reach its target market.
A product needs to attract customers visually and be showcased on platforms that champion visual creativity.
Nevertheless, the good omnichannel strategy mustn’t end there. It must deliver a frictionless shopping experience through a mobile-optimized website.
One important thing to take into consideration is that omnichannel architecture never recommends giving equal or more prominent to specific channel or channels. It only talks about delivering a seamless and consistent experience across channels.
Serving an omnichannel customer experience is not enough! Retailers should think about the seamless performance of each channel.
As a result, the product channel sync is crucial, and getting it right is significant to making your own omnichannel strategy work. Besides, retailers also need to ensure that the connectivity across multiple channels should be streamlined.
A recent survey by HRC Advisory brought the truth that nearly 75% of respondents found e-commerce transactions were stealing sales from the store front. eCommerce growth rates are surpassing brick-and-mortar sales but a good 10–15% margin.
Most omnichannel retail examples failed to strike a balance between in-store and online sales.
People think the omnichannel strategy is all about customer experience and continue to look at online and offline as 2 disjoint channels instead of leveraging one to support the other in order to create a complete omnichannel solution.
Here, we can take the “Beacon technology” for example as a tool supporting companies to reap the up-selling and cross-selling.
The way beacons work: Advertisement, coupons, and supplementary product information can be transmitted to in-store screens located near the customer.
Besides, retailers could also gain vital customer in-store information to deeply understand the maneuver through the stores.
The Importance of Omnichannel Retail
Omnichannel Challenges for Retailers
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ERP: NetSuite, SAP, Microsoft Dynamics
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Retail Management Software
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Accounting: QuickBooks, Xero, Sage
ERP: NetSuite, SAP, Microsoft Dynamics
Payment: Tyro, Global Payments, Stripe
Shipment: Shipstation, DPD, FedEx
Retail Management Software
Franchise POS
Magento ERP
Warehouse Management
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