Omnichannel Retailing: A Guide for Retailers
Posted by Amanda McLaughlin on Nov 26, 2024
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Omnichannel experiences aren’t just a nice-to-have anymore—they’re what customers expect. In fact, 73% of shoppers use multiple channels during their journey. But here’s the catch: while most retailers say they have an omnichannel strategy, very few have truly connected the dots between their online and offline operations.
Omnichannel retailing is the key to meeting customers wherever they are—and delivering the seamless experiences they demand. In this guide, we’ll break down what omnichannel retailing is, why it matters, and how you can build a strategy that works for your business.
Omnichannel retailing is a strategy that provides customers with a unified experience across all touchpoints, allowing them to move seamlessly between channels like your website, mobile app, online store, brick-and-mortar store, and social media.
From the customer’s perspective, it should feel like one continuous, integrated experience versus fragmented touchpoints with your brand. They should be able to start an interaction on one channel and pick up where they left off on another channel.
On the business side, an omnichannel retail strategy requires linking systems and data across channels to provide a 360-degree view of the customer. This allows you to provide personalized experiences based on their preferences and history across touchpoints.
Key elements of an omnichannel retailing include:
Omnichannel retailing and multi-channel retailing may seem similar, but they deliver distinctly different customer experiences. Multi-channel retailing offers various sales channels, like stores, websites, and apps, but these operate in silos. In contrast, omnichannel retailing integrates all channels into a unified experience, ensuring a consistent and connected customer journey.
Omnichannel retailing provides many benefits and an investment in it can and will transform your business.
A strong omnichannel strategy isn’t just nice for customers—it’s great for your bottom line. Businesses with robust omnichannel operations retain 89% of their customers, compared to just 33% for companies that lag behind. Providing a seamless experience across touchpoints makes it easier for customers to engage, purchase, and remain loyal to your brand.
Customer expectations are higher than ever, and 65% of consumers say inconsistent experiences across channels are frustrating. An omnichannel approach eliminates these inconsistencies, offering a smooth, personalized journey tailored to individual needs. Whether customers shop online, visit a store, or use an app, they’ll experience the same quality and convenience, leading to higher satisfaction and stronger loyalty.
By collecting data from every customer interaction—whether online, in-store, or on social media—you gain a comprehensive understanding of your audience. These insights help identify trends, anticipate customer needs, and address pain points. Armed with this information, your business can deliver more relevant experiences, improve product offerings, and create targeted marketing strategies that truly resonate.
Customers crave flexibility in how they engage with brands. An omnichannel strategy provides options for customers to use their channel of choice without sacrificing convenience or quality, building trust and making their shopping experience more enjoyable.
As consumers expect omnichannel experiences, it’s becoming table stakes for customer retention and acquisition. Even more, companies with an omnichannel presence boast a 3.2% compound annual growth rate (CAGR) in market share, compared to a meager 1.5% CAGR for those without an omnichannel strategy. Implementing a strategy now can give you a competitive advantage.
Integrating your inventory, customer data, and logistics across channels reduces redundancies and streamlines operations. This not only saves costs but also ensures customers have real-time access to product availability, faster delivery options, and more reliable service.
The bottom line? Omnichannel retailing is critical for understanding customers, engaging them on their terms, and providing 5-star experiences. Now let’s look at how to build one for your business.
Follow these six steps to implement an effective omnichannel approach:
Start by auditing your existing channels and touchpoints. These may include:
Document all the ways customers currently engage with your brand across their journeys. Identify any gaps in channels where you lack a presence. Then, outline the end-to-end experience you want customers to have as they interact with your brand across channels. Consider key journeys like buy online pickup in-store (BOPIS), ship-to-store, omnichannel returns, mobile checkout, etc. Look for any inconsistent experiences, gaps in data, or constraints that impact the ways in which customers experience these journeys.
Audit your existing systems and processes to understand what you have and what you may need to invest in. These may include:
A retail tech stack will look different from retailer to retailer, but in general you’ll benefit from having an ecosystem of technology partners that is future-proofed and can drive the digital experiences your brand needs today and tomorrow. Consider embracing MACH principles and building a commerce environment with composable elements: microservices, API-first, cloud-native SaaS, and headless. Taking this kind of approach to your retail ecosystem will allow you to deliver omnichannel strategies efficiently and effectively.
With executive input, determine your key omnichannel goals and success metrics. These may include:
Having a successful omnichannel retail strategy requires aligning yourself with your transformation goals. You might want to track specific metrics like those listed above, or historical measures like same-store sales, sales per square foot, and customer traffic. Alternatively, you can look at omnichannel business metrics like the cumulative value of customers, sales, and fulfillment. Regardless, you must articulate your goals to the entire organization, from your board to your retail store teams. In making your goals and metrics visible, you’ll ensure everyone works hard for only the best results.
Prioritize omnichannel initiatives and map out a phased rollout plan. Quick wins balanced with long-term vision. Factor in the following:
Omnichannel is a long-term and transformative strategy and choosing the right technology partners is critical to success. When it comes to implementation specifically, there are a lot of considerations that affect the business and your technology infrastructure. Choose a partner or partners that have flexible and open technology, and teams that stay close to you at every stage of the relationship. They also should have a success manager to act as a trusted guide in the journey as omnichannel impacts people and processes as much as it does technology.
Don’t neglect the role of brick-and-mortar stores just because customers are online or in-app. While each retailer’s omnichannel retail strategy will be unique, most will include elements like:
Believe it or not, forecasts predict that three-quarters of all U.S. retail sales will occur offline this year. But that doesn’t mean ditching digital or focusing on your physical store in isolation. It means integrating physical and digital to create a unified customer experience. An omnichannel approach makes businesses more efficient by enabling sales channels to leverage each other for data, inventory, and services. It drives value for your business and provides a consistent and digitally-rich customer experience.
Use omnichannel data and customer feedback to refine your strategy. Things to track include:
Optimization is everything. Your omnichannel strategy should include advanced analytics to give you a full picture of your business—and actionable insights to keep improving. You should have an easy way to access and explore live metrics and insights, enabling any stakeholder to take immediate action, whether it be responding to inventory trends or following up on sales opportunities. The objective is to use data and insights to test new initiatives, personalize engagements, and double down on what delivers results. Omnichannel evolution is ongoing. Make incremental improvements that are data-driven and customer-centric.
Two standout examples of omnichannel retailing are Scheels and Nordstrom.
Scheels excels with a seamless online shopping experience, featuring well-organized categories and a user-friendly design. Its mobile app adds convenience with an intuitive interface and updates on deals. In-store, Scheels maintains an “energetic” atmosphere with knowledgeable associates and well-arranged displays, ensuring consistency across channels.
Nordstrom offers a robust website, mobile app, virtual meet-and-greets, and livestream shopping. Online, customers enjoy an easy-to-navigate website, access to purchase history, and in-home appointment scheduling. In-store, Nordstrom offers extraordinary customer service further reinforcing a seamless and customer-centric experience.
You can find more examples of brands who are excelling in omnichannel retailing in our 2024 Omnichannel Leadership Report.
We’ve covered a lot of ground in this guide! The lines between physical and digital retail continue to blur. Implementing a strategic omnichannel retail strategy is no longer optional for retailers – it’s imperative.
To recap, here are the key things every retailer needs to know:
With the right strategy, you can plug gaps in the customer journey and meet people wherever they are. Delivering unified shopping experiences is the new imperative for winning over today’s customers.
Looking for a trusted guide on your omnichannel transformation journey? We’d love to help! Feel free to reach out to talk to our team.
