The Future of Shopping: “Omnichannel Retailing”

Posted by on Nov 29, 2012 in Industry, Insight

I recently read an interesting article in Harvard Business Review which outlined some of the issues digital retailing has had to work through over the years. The article discusses some future trends and issues digital retail still faces as many purchases are shifting from in-store to online and morphing fully into something in-between.

The article goes into depth of how initially, online channels struggled to help consumers make the shift from shopping out-of-home to shopping online. It took years of reliably building awareness, trust and infrastructure for eCommerce to fully compete. The same growing pains are occurring in digital signage et. al. The real struggle in most cases is how to effectively integrate (or choose not to) the technologies involved and specifically target. Here is the picture painted of the Omnichannel Retail Experience:

As Amy enters Danella, a sales associate greets her by name and walks her to a dressing room stocked with her online selections—plus some matching shoes and a cocktail dress. She likes the shoes, so she scans the bar code into her smartphone and finds the same pair for $30 less at another store. The sales associate quickly offers to match the price, and encourages Amy to try on the dress. It is daring and expensive, so Amy sends a video to three stylish friends, asking for their opinion. The responses come quickly: three thumbs down. She collects the items she wants, scans an internet site for coupons (saving an additional $73), and checks out with her smartphone.

As she heads for the door, a life-size screen recognizes her and shows a special offer on an irresistible summer-weight top. Amy checks her budget online, smiles, and uses her phone to scan the customized Quick Response code on the screen. The item will be shipped to her home overnight.

The technology may have the wow factor, but it may not necessarily have the staying-power to truly drive sales and increase bottom-line ROI.

True Omnichannel Retailing will combine technologies and offerings in a unique and tailored way. There will continue to be struggles in fully integrating an Omnichannel Retail experience:

  • How will content be created and seamlessly integrated across devices?
  • How will demographics be targeted?
  • Similarly, how will customer lifetime value play a role in the amount spent on a customer based on previous purchases and what is predicted in the future?
  • Will consumers ever be fully accepting of the technology so as to make it effective or will there be overkill and digital advertising burn?

It’s not that we’re not producing data to understand how to execute, it’s currently a two part problem. First, the data to integrate into such an environment needs to be interpreted and interpreted correctly so effective B2C decisions can be made for point-of-sale advertising. Secondly, technologies are still taking time to coalesce. There are still disconnects in how mobile, signage and tablet will work together in brick-and-mortar retail settings in a homogenious way. There will always be a certain place for digital retailing at the point of sale. How and when the adoption will come full circle may take several years.

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