There was a time when the merchandise within the four walls of a retail store dictated what shoppers could buy.
Those four walls have come down. Digitally enabled shopping — from mobile comparison shopping to social recommendations — has launched a feverish quest to serve the new battleground of customer expectations by delivering shopping experiences that redefine and heighten convenience in unprecedented ways. An emphasis on convenience for a consumer has a flip side — an emphasis on data-driven omnichannel engagement for the marketer. The bad news is that only 19 percent of retailers can fulfill an ominchannel marketing strategy profitably. That means four out of five retailers are failing.
Wal-Mart, the world’s biggest retailer, has said an omnichannel consumer spends $2,400 a year vs. an average store-only customer spend of $1,400, and an average digital-only customer spend of $200. What’s more, an omnichannel consumer provides the most data and engagement for Wal-Mart to learn from and use for more relevant future interaction.
The push for omnichannel convenience can become a win-win for retailers if they see the opportunity not as added expense or business complexity, but rather as a chance to capture more value and loyalty from their best customers. This starts with a focus on knitting together data and messaging across channels.
The Mobile Factor
Just as shoppers increasingly turn to their smartphones as the convenience tool that manages their everyday lives, from paying bills and getting directions to watching a movie, they’re also tapping these mini computers in their pockets to be their shopping assistants.
That’s not surprising, as more than ever the path to purchase begins on a mobile device. Digital interactions influenced 56 cents of every dollar spent in retail stores in 2016, up from 14 cents of every dollar spent in 2013, according to Deloitte's study, The New Digital Divide: The Future of Digital Influence in Retail.
The big news there is mobile’s soaring influence: A mobile device influences 37 percent, or $1.4 trillion, in retail sales — double that of desktop sales.
Retail apps, content and other mobile engagement is at the top of many marketers lists this year. Yet two out of five retailers rate themselves poorly when it comes to the analytics needed to connect these efforts to a true omnichannel strategy. A typical issue: failing to identify consumers in different environments.
Amazon Go: A Retail Game Changer, Also a Marketing One?
New grocery store format Amazon Go from the nation’s biggest online retailer holds the potential to redefine notions of shopping convenience.
The concept eliminates arguably the biggest friction point in the shopping experience that technologies from self-checkout lanes to digital wallets have not: the wait in line. Close to 50 percent of shoppers will opt to avoid a retailer or brand if they have to wait in line for longer than five minutes, according to crowd control firm Lavi Industries.
Amazon Go also creates an instant feedback loop of data for the retail giant. With its proprietary systems, Amazon is likely able to harness that data immediately across channels. And while retail efforts to quicken and eliminate the checkout process have called for shoppers to use a device, like Sam’s Club’s Scan & Go, whereby shoppers scan items with their mobile device, Amazon Go goes further. Amazon is the first true closed loop.
Brands which sell through Amazon should already be asking about access to data in real time or near-real time in order to coordinate marketing efforts more effectively. Independent retailers competing with Amazon via loyalty programs now know where the bar is — instant, relevant omnichannel data use. Now is the right time to push partners from Square to Apple Pay to offer open access to granular, real-time data.
The Growth of Click and Collect
Retailers are also jockeying to meet shoppers’ ever burgeoning demand for the convenience that comes from melding in-store and online shopping options.
Indeed, over one-third (35 percent) of U.S. consumers are more likely to shop online if they can return their items in-store, while 21 percent of Americans are more likely to make an e-commerce purchase if they can pick up their goods from a brick-and-mortar store, according to a report by Coldwell Banker Commercial Affiliates.
The draw of the click-and-collect model lies in its convenience, instant gratification and no-shipping-fee appeal. Its growing popularity was eminently clear this holiday selling season.
Kohl’s, for example, provides a dedicated in-store pickup line for online orders, while Macy’s has retrofitted stores so that every location doubles as a fulfillment center for e-commerce orders.
Marketers within retail organizations need to include this kind of information in their arsenal. What’s worse than retargeting a shopper that’s already picked up an item in-store with an ad for that same item? Perhaps failing to even recognize the individual in the first place.
Ryan Urban is the CEO of BounceX, a provider of behavioral marketing cloud technology.