Copyright 2016,

Can retailers afford to ignore omni-channel strategy in today's age?

Omni-channel retail is nothing other than an integrated multi-channel approach which requires that the customer is at the core of the retailer's strategy

Last week while browsing through the website of a large retail chain, I shortlisted a few items and decided to visit the retail store to check the products before making my purchase decision. Much to my dismay many of the products were unavailable in the store. When I checked with the sales staff she promptly mentioned that the products sold online and those in the store were not necessarily the same. I was shocked to say the least and wondered why in a day and age of known webrooming and showrooming, the two product offerings were different. Does reaching the consumer through more channels than one not require an integrated approach?

Multi-channel retail is not a new phenomenon as retailers have over the years used more than one medium to reach the end consumer. Omni-channel retail is nothing other than an integrated multi-channel approach which requires that the customer is at the core of the retailer’s strategy. It means letting the customer decide on when, where and how to shop, the mode of payment and the mode and time of delivery / pick up of the products of his choice. The Indian retail landscape has changed phenomenally over the past decade. This market is expected to double to $ 1 trillion by 2020 from $ 600 billion in 2015. Similarly the e-commerce market is expected to touch $ 60 – 70 billion by 2020. The change in demographics has led to a change in the spending habits and consumer confidence. This necessarily requires the retailer and the brand to be more responsive, agile and flexible in their approach towards the end consumer.  With social media and mobile technology   changing  the way we live, work and shop, it becomes necessary for a brand to not only stay connected with the consumer but also to communicate the same message with the consumer across platforms.  The touch points can be the product offering, the price, and promotion and last but not the least the overall customer experience.  Internationally retailers like Argos, John Lewis, Macy’s, Neiman Marcus, Top shop, Starbucks, Oasis, Crate and Barrel and Tesco among others have been successful in offering integrated experiences.

Closer home, Shoppers Stop Ltd and Adidas are among the early adopters. Shoppers Stop Ltd has set its sights on becoming a true omni-channel retailer across the company’s formats – HomeStop, HyperCITY, and Crossword– by 2017. Apart from redesigning its website to make it responsive across various screen sizes including mobile, tablets etc, it has also entered into alliances with major e-commerce players to set up anchor stores or microsites to sell its brands.

The Adidas group which operates 500-plus Adidas stores and 250-plus Reebok stores, rolled out the ‘endless aisle’ technology. This equips the franchise stores with iPads where shoppers can browse and order for items that are not in stock at the physical stores. The company is focusing on creating stronger online and offline experiences and providing seamless experiences across channels. Luxury brands like Soulflower have found that the stickiness of a consumer for its products is more online than in brick and mortar. It has hence built a “Whatsapp system for consumers”. This gives the consumer a unique number where they can place an order, get free advice on skin and hair care and stay connected with the brand. Using a platform like whatsapp has made it easy for a consumer to interact with the brand and has enhanced the user experience. Online retailers like Amazon remember your past shopping preferences and customize the offering and recommendations that you see. Many online players have gone the extra mile and launched delivery centers where the customer can pick up the merchandise ordered.

From a retailer perspective, creating an omni-channel experience requires building organizational capability as it demands a seamless integration between the functions of merchandising, inventory planning, logistics and supply chain and marketing. Synchronizing data across channels will be a key requirement and technology will again play a key role here. It also needs a change in the mindset where the customer is at the center of the corporate strategy. By integrating and aligning channels – stores, e-stores, mobile apps and social media – Omni-channel retailing provides a flexible and seamless shopping experience to customers. After all, in the words of management guru Peter Drucker, “The purpose of business is to create and keep a customer”. In an age of the fast changing consumer can an organization really choose not to have an integrated approach? Was that not just simple common sense?

(References: Retail 2020: retrospect, reinvent, rewrite a RAI BCG publication; Shoppers Stop Ltd Company Annual Report 2014 15)

By Prof Dr Swapna Pradhan, Head - Retail Management, Prin L.N.Welingkar Institute of Management Development & Research (WeSchool), Mumbai