Going for Omnichannel Gold in 2017
In a recent study, what kind of customer did 59% of U.S. retailers say were more profitable than others? If you answered “omnichannel customers” then you’d be correct!
The popularity among consumers of the omnichannel experience (with online and offline shopping options that are largely consistent) is likely due to consumers’ preference for choice and for the convenience that having options provides. Consumers increasingly move freely between physical and online shopping. Retailers that recognize this trend, ensure that their offerings are consistent between the two channels, and are able to convert customers regardless of how they shop will likely improve their bottom line.
Recognizing that consumers are increasingly seeking an omnichannel experience, some of the biggest names in retail are venturing beyond their “traditional” realms to expand their omnichannel reach. In early January, the online behemoth that is Amazon announced that it’s opening its fourth brick-and-mortar bookstore, in New York City. Amazon already operates Amazon Books stores in Seattle, Portland, and San Diego. Additional stores are planned for New Jersey, Illinois, and Massachusetts. In addition to books, the stores sell Amazon devices such as the Kindle.
And Amazon Books isn’t the company’s only retail experiment. They’re also just launched a convenience store with automated checkout, called Amazon Go, in Seattle. While the company is quick to dispute any large-scale plans for this kind of physical presence, claiming, “we're still in that phase where we're testing and learning and getting better,” the CFO did say in a recent earnings call to expect more brick-and-mortar Amazon bookstore locations.
Also seeking to add more “omni” to their channel is Walmart. They acquired Jet.com last year, to “position the company for even faster e-commerce growth in the future by expanding customer reach and adding new capabilities.” This subsidiary recently completed its purchase of online footwear retailer ShoeBuy. The purchase, Walmart says, will offer Jet, “the experience of a well-established ecommerce player … and rich content that will further enhance customer experience.”
Walmart also cites these acquisitions for positioning them to grow faster and offer a “seamless shopping experience” which is at the heart of the omnichannel strategy. Finally, they give a nod to the expectation that the Jet brand will “infuse Walmart with fresh ideas and expertise” which will help them appeal to millennials—a generation that has exhibited a strong preference for digital options.
Indeed, the ability to reach more consumers, and target specific kinds of consumers, is at the heart of many retailers’ expansion into new realms. Because, as noted at the beginning of this post, the omnichannel customer may be the most valuable.