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The Omnichannel Experience Will Be The Natural Model

It’s not a battle. You don’t have to choose between digital or physical shop. The omnichannel experience will be, if it is not already, the natural model for all shops.

Mutually exclusive choices, polarization and extremes have invaded the way we think in too many fields, including retail sales and distribution. For years, we have assumed that physical shops acted as a separate world, divorced from the world of e-commerce. That is why we accepted the fact that there would always be a Walmart and an Amazon, one empire of bricks and mortar and another of bits. But all along, the rapid pace of change in the competitive landscape and business models, plus retail’s central focus on the customer, was showing us just the opposite.

We learned that Amazon, Walmart and all the leading chains would obviously go wherever their customers were, and that the retail competition battlefield would blur the boundaries between physical and digital. Those boundaries have never been more blurred. Amazon purchased a U.S. supermarket chain, Whole Foods, for almost $14 billion and it is opening dozens of physical stores in shopping centers and in department stores. Walmart, in turn, was crowned the third largest e-commerce giant in the United States, after eBay (No. 2) and Amazon (No. 3).

The buzzword of the moment, especially for the big players, is omnichannel: offering customers access to almost the same products and prices online and in the bricks-and-mortar shop. There are differences of course, but any differences that are not part of a strategy have to be remedied quickly.

Here’s how omnichannel should work: If a shopper does not find the size or color of a pair of pants he or she wants in a fashion chain’s physical shop, the salesperson will get it for them. First, the salesperson will check the inventory of that location, then the stock of other locations nearby, then finally, they will encourage the customer to buy it online without leaving the shop. The customer will always be a few clicks away from getting what they want, and they will be able to pick it up in 48 hours or have it delivered to their home.

Is shopping over the internet within the walls of a shop with the help of a salesperson electronic commerce? Or is it physical commerce? This is a Byzantine and useless debate. The important thing is that the sale is made and the satisfied customer has found what they wanted. He or she will probably come back. The centrality of the customer and the omnichannel approach blur the differences between the world of bricks and mortar and the world of bits. We access almost everything almost everywhere.

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SALES CHANNEL NUANCE REMAINS IMPORTANT

In addition to the omnichannel approach, which highlights the continuity between the physical and digital worlds, retail’s big players are also learning to make the most of the differences between channels. At the end of the day, there are some products that we all want to see, touch and sometimes even try on before buying them… and there are others that we will buy with only a glance on our mobile phones.

For instance, a PwC survey shows just how quick we are to buy books, music, films, video games or toys online, and just how reluctant we are to buy food, furniture or household appliances with a simple click. This helps us to understand the crisis and bankruptcies of the major international toymakers that invested above all in their brick-and-mortar shops and shelves. It also helps us to clearly see that a brick-and-mortar shop and a digital shop are complementary.

As we move forward and data analysis improves, the nuances among channels will multiply. Customers who would never shop for fresh food in an online supermarket will be far more willing to do so in a small supermarket set up two blocks from where they live. Why not encourage customers to shop both online and in a physical store, depending on their needs? For instance, they may buy fresh products they need for that night’s dinner in the store, then order heavier items and pantry staples online for delivery. The same can be said for readers who know what they want and buy it online and those who prefer to be guided and surprised by a bookshop or a salesperson who can advise them.

In fact, Doug Stephens, the consultant, visionary and author of Reengineering Retail, has highlighted the lack of personalized advice and unique experience found in a bricks-and-mortar shop as the two insurmountable weaknesses of online shopping. In his opinion, the internet allows us, above all, to find what we are looking for and to find out about it. The bricks-and-mortar shop, on the other hand, can open the door to experimenting with things that we still don’t realize that we like, and allows us to do so in the company of other consumers who share our passions. The physical shop also allows us to enjoy the advantages of expert guidance to point us in the right direction, to surprise us and to help us to personalize the product. In this way, the online experience and the shop experience are also complementary.

The major players can no longer embrace only their physical or digital shop, to the exclusion of the other, nor can they afford to under-developing one or the other. These are no longer two, artificially-separated worlds, and instead embrace each other in an omnichannel approach.

Ultra-fast delivery and changing consumer mentality have irrevocably altered the retail business model. The central focus on the customer requires that they are accommodated both inside and beyond the domains of bits and bytes or brick and mortar.

The omnichannel approach continues to advance, making it possible to offer shoppers the exact same products and services on a mobile phone or in a physical shop. In the end, customers’ lifestyles and the differences between the products they like to shop for online and those they like to shop for in-person no longer justify two incompatible worlds. Rather, they urgently call for complementary spheres. We undoubtedly live in fascinating times.

Dimas Gimeno

Spanish retail leader with more than 20 years of experience in the sector. A specialist in digital transformation, omnichannel and new business models. From 2014 to 2018, President of El Corte Inglés, one of Spain’s leading companies and a leader in the European retail sector, with a turnover of 16 billion euros, 90 stores in Spain and Portugal, and more than 92,000 employees.


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