Full Omnichannel is Possible — And it's Do or Die
The effects of the current pandemic on retail have been unlike anything we’ve seen in the industry. Consumer behaviors are five years ahead of predictions and strategic technology timelines have shrunk from several years to a few months. These dramatic occurrences are all because omnichannel is essential right now. The cautious consumer isn’t a trend that will go away when COVID-19 does. Shoppers will now always expect contactless and convenient ways to shop. For brands, that means deliver on expectations or risk the worst.
The State of Omnichannel
In the 2021 Omnichannel Leadership Report, NewStore looked at how nearly 200 luxury, premium, and lifestyle brands have responded to the pandemic. The research examined the availability and seamlessness of 14 omnichannel capabilities, and gave an expert opinion on how brands are faring. While there are many brands thriving right now — either overall or in specific business areas — there are also many brands facing severe challenges.
Those that have proved more resilient than their competitors are in that position because of the capabilities they’ve invested in for years. For example, Nordstrom has been prioritizing its inventory precision, which allowed it to use inventory and fulfillment early on as a lever of flexibility. Michael Kors was primed to respond to consumer needs born of the pandemic because of its focus on industry-leading e-commerce and store capabilities.
At the other end of the spectrum are too many brands struggling to adapt. It’s not that they haven’t made attempts to roll out omnichannel solutions. They have. But they're failing in their ability to offer seamlessness. This is something that's widely expected of the customer experience, but only possible with integrated digital and physical channels. Duct tape and magic won’t work. Instead, brands need a truly unified business, from infrastructure to people, supported from the top-down.
Here’s a look at some of the findings from the report. Several of the capabilities have experienced measurable growth. This is good to see, but we need to see the growth at scale.
Notable Report Findings
- 83 percent of brands offer contactless pay vs. 75 percent in 2019;
- 45 percent of brands can contact customers outside the store vs. 25 percent in 2019;
- 20 percent of brands offer online appointment booking vs. 9 percent in 2019;
- 40 percent of brands offer store pickup (BOPIS) vs. 25 percent in 2019; and
- 32 percent of brands offer curbside pickup.
Planning for the Long Term
Just a few years ago the core omnichannel capabilities were nice-to-haves and low on most brand priority lists. Then, as the direct-to-consumer market became more crowded and as customer needs changed, they became required points of differentiation. More and more brands implemented omnichannel to optimize their customer experience and grow revenue. Today, omnichannel is the only means of survival.
As you plan for the long-term implications of the pandemic, you can’t think about omnichannel incrementally. Services like store pickup and endless aisle aren’t solutions that you can deploy with blinders on. They require real-time connectedness between front- and back-end systems, as well as alignment across business functions. This, combined with easy-to-use solutions for omnichannel associates, who can engage and transact with customers in-store, online and on mobile, is the recipe to success.
If you can deliver true omnichannel — which yes, is very achievable — your brand can experience revenue increases of up to 20 percent. This is only one of the many financial success metrics, with other benefits ranging from inventory efficiency to associate productivity. Use these as your motivation to stop leaning on stop-gap solutions and start making long-term investments in omnichannel. The future of your business depends on it.
Stephan Schambach is the founder and CEO of NewStore, the essential omnichannel store solution for vertically integrated brands.
Related story: COVID-19 Drives 3 Key Omnichannel Capabilities