When online shopping first started to take off, over a decade ago now, many ‘experts’ foresaw the death of the physical store. They figured that consumers would all want to shop online and only online, and that bricks and mortar stores would cease to be relevant and would become an extinct species.
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But, to paraphrase Oscar Wilde, ‘rumours of the death of the store have been greatly exaggerated’. Certainly, online sales have grown consistently over the last ten years, but they still only account for less than 10% of overall retail sales. So, does this mean that online retail is not important – if over 90% of sales are still going through the store, does that mean that retailers don’t need to focus on online?
The answer is resoundingly that online is still crucial to a retailer’s success. And that’s because there is a phenomenon that isn’t reflected in simple statistics of sales through one channel or the other. It’s the phenomenon of the interaction between the channels. It’s the power of omnichannel retailing.
The truth is that whilst sales transacted online account for a relatively small proportion of revenue, a store’s online presence is essential to the overall brand experience and is a highly significant driver of instore sales. We can no longer separate the online and instore channels – they are both part of the ecosystem that we call omnichannel retailing.
As we reach the end of 2017, and take a look back, I think we can say that it has truly been the year of omnichannel retail. Smart retailers have realised that online needs to be an absolutely integral part of their approach to the market, but that it doesn’t compete with their stores, it enhances their stores.
We used to talk about multi-channel retailing, meaning multiple, but separate, channels. 2017 has seen us move into the era of true omnichannel retailing, where it is no longer relevant to think about the channels as separate entities, because their value is in their integration. They feed each other and the whole is greater than the sum of the parts.
Omnichannel Integration was seen in five key ways:
- Brand Image
Even if shoppers don’t use the online channel to purchase, they expect it to be there, expect that a strong brand will have a strong online presence. A retailer without a strong online presence has a weaker brand in the eyes of consumers.
- Decision Making
Even in-store purchases involved multiple channels for research and awareness, including online. A shopper might see an advertisement on mass media, see that their friends and family like it on social media, read reviews on a recommendation site, and visit the retailer’s website for detailed product information before making the final purchase in a bricks and mortar store.
- Online As A Powerful Customer Intimacy Tool
Online we can see not only what a customer buys, but what they have browsed before making their purchase decision – and this information feeds into the tailored promotions and special offers that customers love.
- Click and Collect, Or BOPIS Driving In-Store Sales
Research by digital advertising company Retale, shows that 44% of shoppers have used BOPIS and that 33% of them buy additional items when they go into the store to collect
- Online Presence
An online presence allows a retailer to integrate inventory information – this is a powerful tool loved by shoppers, who can check availability before going to the store.
2017 has been an exciting year – I’ve loved seeing more and more retailers implementing omnichannel retail and reaping the wide range of benefits.