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What is Omnichannel: Retailing, eCommerce and More

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Today’s customers expect brand experiences to be consistent wherever they are, on any channel they choose. Whether browsing social media, exploring a website, or shopping in-store, customers want a seamless, fluid shopping experience. Otherwise, they can easily visit a competitor and find the seamless experience that they’re looking for.

Given these high customer expectations and the competitive environment brands face, merchants need to take a serious look into how they implement an omnichannel retail experience. Here you’ll learn what omnichannel is and how an omnichannel experience works.

What is Omnichannel?

Omnichannel is the strategy of using multiple marketing channels integrated in a way which affords the end-user a seamless front-end experience. Customers interact with brands through a wide variety of sales and marketing channels: websites, mobile browsers, native apps, physical retail, social media, email, and more.

While in the past these would all have their own systems and processes, customers now expect their experiences to flow from one channel to the next without interruption.

Imagine for instance, a customer places an order through a brand’s eCommerce website. She later goes to check the order status on her native mobile app to ensure it’s been shipped. When it arrives, she decides to go to the physical store to return an item she’s unhappy with. After returning the item, her account is automatically credited and a confirmation email is sent. The brand then begins to remarket similar products to her on social media. Once the exception, this example of a smooth eCommerce experience is now what customers expect.

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Omnichannel vs. Multichannel

You may be wondering if there’s a difference between omnichannel and multichannel approaches. Multichannel is the strategy of having multiple different sales and marketing channels to engage your customers. Traditionally, these were isolated systems unable to share data or processes with one another. Omnichannel marketing effectively removes the boundaries between these disparate channels, creating an immersive customer experience.

The Benefits of an Omnichannel Retail Approach

There are a number of advantages to using an omnichannel strategy in retail:

  • Increased conversions and sales
    With a frictionless path to purchase, customers are less likely to abandon their cart and more likely to check out with a larger basket size. This can be accomplished using shared data across your channels. For example, a loyalty app integrated with both online and physical retail channels ensures your customers are always able to earn and redeem points with minimal effort, incentivizing them to purchase again.
  • Meet customers’ online needs
    Customers expect a seamless user experience, and they won’t stick around when faced with clunky or slow interfaces. Integrating customer-facing and back-end systems ensures customers can easily find and purchase whatever they’re looking for. It can also help you promote products based on shared data.
  • Adapt to changing trends in technology usage
    Consumer preferences change along with technology and retailers must be flexible enough to adapt. An omnichannel approach guarantees a consistent customer experience regardless of the channel or device they prefer to use.

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  • Improved customer retention
    When customers can interact with your brand across connected channels, it increases the likelihood they will purchase from you again. For example, they may have visited a store location and enjoyed the experience, increasing the chance they decide to buy from you online if you remarket through email and social media – ultimately increasing customer lifetime value.
  • Data-driven insights across channels
    Combining data from all channels enables smarter decision-making by leveraging every bit of information your customers share with you. For instance, website analytics focused on clicks and searches can be applied in-store for smarter product procurement and merchandising. Similarly, in-person feedback with sales representatives can be used to make decisions about future marketing campaigns and promotions.
  • Improved fulfillment
    Bridging sales channels allows customers to receive and return products through both shipping and in-store channels. It creates a convenient customer experience while potentially saving money with reduced shipping costs and return processing expenses.

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How to Get the Most Out of Omnichannel

To truly benefit from omnichannel retailing, you must focus on strategy and taking action on important data insights. Fortunately there are a number of ways for getting the most out of your omnichannel strategy:

  • Know your valuable channels
    Brands should use analytics and track KPIs to get a sense of their most important channels. These are typically the most profitable or those featuring the most efficient customer acquisition flow. While all channels should be as closely integrated as possible, you should prioritize the most valuable ones and ensure a fast, fluid customer experience across them.
  • Consider the buyer’s journey
    Many new buyers will engage through your brand via multiple channels before making their first purchase. This means your marketing funnel should be monitored for opportunities to boost conversion rates and sales. For instance, a customer who abandoned their online shopping cart should be quickly offered a discount if they complete their purchase within a specific time frame.
  • Personalize the customer experience
    When a customer purchases a product, they’re implicitly sharing their preferences with your brand. Use this to your advantage by dynamically restructuring your product and marketing offerings to increase the chance they order from you again.
  • Use existing tools that work
    There are a number of software systems and other technologies which can help make channel integrations easier. Order management systems help integrate different sales channels, giving fulfillment and customer service representatives a single portal to access. And product information management (PIM) tools centralize data for all of your products in one location.
  • Utilize all your data
    Data can be your most valuable asset. You can personalize the user experience, expand your reach through audience marketing campaigns, make informed decisions about website design and merchandising, and more. Your organization should track, analyze, and share as much relevant data as possible.
  • Build your brand
    Increasing brand awareness in today’s competitive online environment can be tricky. By promoting your brand through multiple integrated channels, you can grow customer impressions and boost brand image thanks to your frictionless cross-channel experience.

Anticipating Possible Omnichannel Challenges

Like any major change, implementing an omnichannel experience comes with its share of roadblocks. Proper planning and precautions can help to avoid them.

Data privacy and security always comes first as integrating systems increases overall data exposure. This requires control access is properly set up, software is regularly patched, data is encrypted both in transit and at rest, and industry standard security protocols are followed. Also ensure you are compliant with any applicable data privacy standards, such as the GDPR for organizations which do business in the EU.

You should also factor in the cost of creating an omnichannel experience in advance. Integrating channels can be expensive and costs can vary significantly depending on the scale and complexity. Whenever possible, use tools for tasks like order and product management to save time while reducing scaling-related expenses.

Finally, customer shipping is a necessary part of any omnichannel strategy for businesses focused on physical merchandise. Customers expect deliveries will be made in a timely fashion with little hassle. Building a cohesive fulfillment strategy is critical, from providing convenient return policies to varied shipment options. Creating a fulfillment plan and carefully considering what your customers expect will help create a pleasant, convenient experience which grows customer loyalty.

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Omnichannel in Action

Omnichannel strategies are being adopted by retailers and brands around the world. Here are a few examples of businesses who have successfully integrated omnichannel workflows.

Increasing Sales in a Declining Market

Primeau Velo is one of the major bicycle retailers in Canada. In early 2016, the brand found itself in a quickly declining market, as eCommerce sellers were eating away at their sales and revenue. Primeu Velo decided to take control by implementing their own omnichannel strategy.

The company integrated all aspects of its business, which includes eCommerce, enterprise resource planning, and accounting. They developed a seamless customer service experience which let consumers interact directly with the brand through a range of channels including their website, live chat, in-store, and mobile environments. In the process, they found customers who initiated chat sessions had 30% higher conversion rates and that 20% of their in-store customers had spoken to an associate before their visits. Primeau Velo increased its sales by 27% that year alone.

Revolutionizing a Digital Business

Rural King is a farm supply store serving the needs of communities across the Midwest U.S. since 1960. Many customers use Rural King’s online store to research and purchase specialty products to keep their operations running. However, manually servicing Rural King’s millions of in-store and online customers became increasingly difficult.

In 2017, Rural King implemented an omnichannel strategy to automate critical business processes including order tracking, inventory management, fulfillment, and reporting. The result was a seamless customer experience which helped customers find what they needed across all channels. In addition to streamlining delivery timeframes, Rural King also provided the option for in-store pick-up.

Thanks to the power of its omnichannel strategy, Rural King increased its online revenue of 34%, increased traffic in 95% of its stores, and doubled its store locations within six years.

Personalizing the Customer Experience Across All Channels

Italian furniture design company Calligaris offers thousands of product variants to customers in over 100 countries. However, their proprietary eCommerce solution was showing its age. The system was unable to integrate with their pricing or promotion systems, and did not handle mobile device ordering well. They decided to implement an omnichannel strategy to successfully merge their online and physical retail experiences.

Calligaris began with a much needed performance update to their online offerings while integrating their pricing systems. They also developed a unique kiosk system in their stores which allows customers to generate and view 3D renderings of their custom furniture configurations. After creating a design through this system, customers can place an order or add these products to their wish lists. Product information is fully available in-store and on its website. This improved the customer experience, dramatically reducing the backend maintenance overhead of managing otherwise disparate inventory systems.

Start Implementing an Omnichannel Approach in Your Business

When implementing a great omnichannel experience for your customers, you need a partner who can help bridge the gaps between your existing channels —and take advantage of new ones— using secure integrations. Magento Commerce provides comprehensive solutions for eCommerce, order management, and business intelligence. Request a demo to see how the world’s most flexible commerce platform can help you provide customers with a seamless shopping experience.

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