Does your brand cater to the mercurial swings of a modern consumer’s busy life? According to Google’s research, 85% of shoppers start their purchase on one device and finish on another. Combine that statistic with physical stores, and the traditional retail formula has officially been turned on its head. To provide the best experience for your customer from start to finish, you must first position your brand in the mind of the consumer. What problem can you help them solve? How can you reduce friction in their purchasing journey? Does your brand have the power to influence consumers after they leave the store?
One of the best retail strategies in recent years is the rise of omnichannel retail solutions. Successful omnichannel retailers are reporting triple-digit growth in new channels, increased customer retention, and increased revenue.
An omnichannel retail strategy is a multi-layered approach that provides consumers with a full-integrated shopping experience both in-stores and online. Successful omnichannel retailers offer a seamless experience for their customers by leveraging modern technology, loyalty programs, and seamless app experiences. In return, retailers can leverage metadata to follow their customer’s journey and provide enhanced opportunities for future purchasing. Omnichannel retailers offer a brick and mortar experience but allow the customer’s journey to continue after leaving the store.
The Importance of Omnichannel Retailing
First and foremost, a well-executed omnichannel retail strategy provides the consumer with a fully integrated shopping experience, decreasing friction at the point of purchase and making purchasing from your brand as easy as possible. From a retailer’s perspective, omnichannel allows for a myriad of benefits, namely, metadata on purchase history, increased customer loyalty, and the ability to track consumer’s buying habits and patterns after leaving a store’s physical footprint. By giving consumers a digital experience at a brick-and-mortar location, e-commerce opportunities are expanded, encouraging them to make future purchases.
Employing multiple purchasing channels also offers retailers an open communication line to their customers, providing hyper-targeted marketing opportunities.
Omnichannel Retail Strategy
A successful omnichannel retail strategy will begin with the consumer in mind. For retailers trying to capture consumers in the early stages of the buyer’s journey, endless aisle technology will help close the gap between browsing in-store and online. Suppose a consumer is browsing a store but can’t find what they need or ultimately decides to wait on making a purchase. In that case, tools like QR codes, SMS, and social media sharing allow retailers to track consumer shopping behavior after a physical store visit and give the customer a clear path to making the purchase when they decide they are ready.
“Target credited new, omnichannel customers with its expanded growth, acquiring 12 million new customers in 2020.”
A prime example of a successful omnichannel retail strategy is Target. Target, posting 145% growth in 2020 (a total of $16.63 billion), saw e-commerce account for 18% of its total sales, compared to 9% in 2019 and 7% in 2018, respectively. The retailer expanded its omnichannel retail strategy with curbside pickup (named Drive-Up by Target) and same-day delivery with Shipt. Same-day delivery sales with Shipt were strong in 2020, growing more than 300% as consumers relied heavily on delivery services amidst the pandemic.
With an impressive brick and mortar footprint (1900 stores in all 50 states), Target noted that 95% of all sales were fulfilled from physical stores, making sure to note that its physical locations were an integral part of its digital growth strategy. Target reported that their digital sales grew by nearly $10 billion in 2020, credited chiefly with a 235% growth in the company’s same-day delivery service.
Target credits new, omnichannel customers with its expanded growth, acquiring 12 million new customers. Noting in their year-end earnings report that “12 million more guests became multi-channel shoppers. Over time, multi-channel guests spend on average nearly 4x more than a store-only guest and nearly 10x more than a digital-only guest.”
Target puts convenience top of mind for its consumers by offering five separate ways to purchase:
- Shop in-store
- Same day delivery
- In-store pickup
- Drive-Up
- Traditional delivery
Not only do consumers have the ability to choose their service by pickup/delivery time, but they also have the option to choose by price point. Budget-conscious consumers still benefit from free services like Drive Up and in-store pickup. Those who value convenience over additional cost can opt into a Shipt membership for $9.99/month. Target’s omnichannel retail options allow for inclusivity. Consumers with mobility issues or disabilities also benefit from same-day delivery and drive-up services.
Those with a Target Red Card are embedded even further into the company’s ecosystem, saving 5% on each purchase, unlocking free two-day shipping, and the ability to scan their digital wallet when checking out.
For more on BOPIS solutions for your retail brand, visit our Experiential Retail page.
Examples of Omnichannel Retail Shopping Experiences
Loyalty programs, mobile apps, and endless aisle technology lead the way in omnichannel retail shopping. Mobile apps on iOS and Android provide shoppers with instant connections to online browsing product information, online ordering, and loyalty program perks, allowing for a seamless customer experience. Take a look at the four ways retailers can create omnichannel shopping experiences:
Blending In-Store and Online Purchases
Retailers are increasingly embracing mobile solutions that allow consumers to drift between in-store and online shopping experiences while driving sales on both channels. One example of this is scanning. Consumers can scan QR Codes to check in at a register, pharmacy, get product information, or save receipts in their account. They can scan barcodes to check prices on items, check for offers or coupons, refill prescriptions, or scan receipts. They can also scan shelf tags to quickly find an item online if the product is sold out in-store.
Endless Aisle Devices
Stores that embrace endless aisle technology have seen their profits skyrocket in recent years. Much like the blending of in-store and online experiences, retailers like Dick’s Sporting Goods and Neiman Marcus take the concept of the endless aisle one step further by equipping employees with handheld tables and mobile devices. These associates can assist customers in all corners of the store, allowing them to check inventory in real-time and assist with online ordering and shipping if a product is not available in-store.
Mobile Apps with Strategic Loyalty Programs
While mobile apps are nothing new; retailers have leveraged new technology to make consumer experiences better every year. Retailers like Starbucks, Steve Madden, and Ulta have leveled up the playing field, arming consumers with seamless experiences that make purchasing more straightforward than ever.
Starbucks allows their caffeine-deprived customers to check their balance and reload their ‘Gold Card’ in-person, over the phone, on their desktop, or the app. Funds loaded to Gold Cards appear in real-time. Starbucks rewards users for using their Gold Cards with rewards for free coffee or espresso shots based on stars earned. Steve Madden takes rewarding for engagement a step further by rewarding consumers with ‘SM PASS’ points. Points are awarded when a consumer purchases with the app, refers friends, writes product reviews, and completes more advanced engagement activities.
Ulta, meanwhile, took a mobile approach from the start. Ulta’s e-Commerce Director, Jeff Hamm, was quoted saying, “Ulta challenges itself to design the digital experience with mobile in mind, not desktop. We build on mobile, and then adapt to other mediums”. Ulta relies heavily on its mobile app and its loyalty program “Ultamate Rewards” to grow sales. Members of Ulta’s loyalty program receive special access to beauty tutorials, special invites to exclusive events, and special deals.
Social Media Integration
Social media integrations are promoted at the retail level to encourage consumers to 1) engage with a brand’s social media accounts and 2) influence consumers to opt into “sharing” from a digital interface. The latter is designed to complete a sale after a QR code is scanned in-store or a consumer shares a product’s information with themselves via SMS or sending to a friend via social channels. The brand can then track purchases made after the initial social media engagement. Retailers like Nordstrom, Nike, and Adidas execute social media integrations particularly well, each boasting a high follower count and integrating social media into the buying experience.
Omnichannel Retail Technology
The goal of omnichannel retail technology is to bridge the gap between what customers do after leaving your store and deciding to purchase. Along with loyalty programs and endless aisle devices, omnichannel retail technology allows retailers to track the customer journey in and away from the store. Popular omnichannel retail technologies include instruments like CEM databases, geolocator tools like beacons, and metadata.
Customer Experience Management (CEM) Databases
CEM’s are favored by retailers for their ability to accumulate consumer behavioral data. Store visits, interactions with products, and targeted marketing efforts allow retailers to parse a consumer’s behavioral patterns, income level, and likeliness to buy.
Geolocation Data / Beacons
Geolocation data is just that- data that collects a user’s location. This information allows retailers to send location-specific ads or coupons once they’ve entered a designated”geo-fenced perimeter” – enticing users to visit a physical store to redeem. Beacons allow consumers to be notified by a friendly notification when they are close to a store. In turn, retailers can highlight store-specific promotions or remind consumers that their loyalty points are due to expire.
Promo Codes
Similar to geolocation data, promo codes sent to consumers using targeted ads encourage future purchases (both in-store and online) and provide new communication lines to invite shoppers to return to the store for special offers and events.
Metadata
Metadata, at its core, is data about data. Metadata allows retailers to piece together the ‘trail’ of data crumbs that consumers leave behind while using mobile devices, social media, email, and POS systems. Besides capturing information like name, phone number, and email, metadata provides the structural framework for marketing campaigns, sales strategies, and expansion opportunities.
Is your brand looking to expand your omnichannel retail strategy? MINT employs omnichannel retail technology to help companies solve their biggest consumer challenges. We encourage you to explore our endless aisle services, visit our blog for the latest industry trends, or contact our team to schedule a free, 30-minute consultation.