This blog post comes courtesy of Miya Knights, Head of Industry Insight, Eagle Eye Solutions Ltd.
‘Omnichannel’ customers, who shop both online and instore, were found to be worth 10% more per visit online and 4% instore compared to single-channel shoppers, according to Harvard Business Review research.
However, January’s UK sales figures, as tracked by online retail association IMRG, found online-only retailers performed significantly better than their multichannel counterparts, with sales growth of +7.6% vs. -2.9%.
Continuing a trend seen since April 2019, the outperformance of pureplays compared to multichannel operators seems to contradict the notion that omnichannel shoppers are the most valuable.
If that were the case, the single vs. multichannel growth rates should be reversed. Instead, these latest IMRG figures suggest that multichannel operators are missing a trick by failing to offer a seamless brand experience.
Hence, the debate over whether omnichannel is a ‘zombie’ term is unlikely to subside. It will remain a valid term as long as operators struggle to maintain a consistent presence across multiple sales channels.
Using the prefix ‘omni’ focuses minds when it comes to distinguishing between retailers and brands that operate multiple, distinct channels and those who are rightly trying to offer the same experience across all.
Multichannel retailers that cannot offer consumers an omnichannel customer experience are potentially losing out to those that either can, or don’t bother to; in that they make do with only the one sales channel.
But even pureplays don’t have it all their way: they may be able to claim the lion’s share of growth, but often hit a glass ceiling when customers want the chance to touch and feel their goods in a physical retail setting.
Take the successful example of Made.com. The furniture retailer last year revamped its flagship London store and said it expected revenue from nine European countries to overtake the UK as its biggest market.
“For us being a digitally-native brand, online will always come first, but we know a human connection with the brand can be a valuable midpoint in our customer journey,” said Jo Jackson, Made.com chief creative officer.
“We are doing something different with our physical spaces,” she added. “They are not shops; they are brand experiences.” Unsurprisingly, Made.com has been able to support its growth with this omnichannel expansion.
This is why my gut tells me that the discrepancy in growth of pureplay vs. multichannel operators tracked by IMRG is down to the fact that those with a single channel are easier to shop than those with multiple ones.
But what does this mean in practice? It means consistency. But too often, many fail to even offer the same rewards, promotions and discounts in one channel that are available in others, for example.
If consistency lies at the heart of a truly omnichannel retail commercial model, personalisation is the key to also demonstrating that a customer (and their history or preferences) is recognisable across channels.
The digitisation of physical sales spaces, so they are capable of recognising and responding to customers that already engage online, will be a key stepping stone towards recognising your best customers instore.
So, ensure customers can access the same products, services and capabilities online as they can instore. Digitally augment the physical experience so it can offer the same level of personalisation instore as online.
Would you like the chance to discuss your retail needs face to face with Miya? RingCentral is partnering with Miya at Retail Week Live (7-8 October) to offer you a free personal consultation. Book your time with Miya at Retail Week Live.
Originally published Mar 05, 2020, updated Jan 16, 2023
