Omnichannel has never been more important than it is today
Nowadays, omnichannel – also spelled omni-channel or referred to as omnichanneling – is more than ever 'en vogue' and on everyone's lips. To meet the expectations of today's customers, 75% of whom are already strongly in favor of a hybrid shopping experience, companies are already promoting services that link their on- and offline channels to significantly improve the customer experience. However, a closer look reveals that these services, such as click & collect, do not yet fully meet customer expectations as they cannot entirely satisfy the omnichannel approach.
As your Transactional Experience Partner (TXP), we intend to use this page to give you an overview of what exactly is meant by omnichannel in times of changing customer expectations, how the concept can be differentiated from others, and how important this change is for your business model, your interactions with your customers, and your long-term business success.
This is important because today, customers expect an optimized and seamless shopping experience – more than ever before – and are only willing on a long-term basis to be loyal to a brand if the experience is perceived positively. In this context, a Google survey shows that almost half of all customers today are not completely satisfied with the customer experience: moments of frustration while shopping has increased between 2019 and 2022, rising by 13 percentage points to 49%. Backed by our years of experience in digitization projects, we would like to work with you in placing the customer experience, which is crucial to success, in the focus of your business activities, identify your relevant customer touchpoints, and support you in managing and controlling them synergistically.
Omnichannel in the retail sector
Definition & importance
An omnichannel strategy for your company essentially has the aim of seamlessly linking all your customers' touchpoints with your company – online as well as offline – to achieve complete transparency across all interactions and enable your customers to seamlessly change between the individual channels with no disruption.
In a concrete example of omnichannel retail, customers can in an ideal case already check the availability of a product online in preparation for a store visit and reserve the product directly. Research shows that, as a rule, three out of five customers who purchase in-store inform themselves online in advance. In this respect, displaying the availability of products in-store on the website is one of the most important omnichannel services. As a result, the retailer's employees can see when and how a customer was last in contact with the company as part of a fully integrated omnichannel customer experience. In our use case, local sales associates would thus be able to see which additional products customers were still looking at when they visited the website and which products were purchased within previous online or offline transactions. With this information, in-store sales associates can further personalize the customer's visit and provide more personalized advice to your customers based on their preferences.
An omnichannel business model thus enables you to take your engagement with your customers to a more personal level. Putting your customers at the center of everything you do, something they expect from you today to a greater extent than ever before, will help you establish stronger customer loyalty and, in the long term, ensure the commercial success of your business. According to a hybris publication, the general probability of cross-selling and upselling is 5% to 20% for first-time customers, while it is many times higher for retained, loyal omnichannel customers and can be as high as 60% to 70%.
An outstanding omnichannel customer journey, which allows you to decisively differentiate yourself from your competitors, naturally relies on your target group(s) with their individual expectations and needs, as well as on the products and services you offer. More specifically, demographic, socio-economic characteristics and buying behavior have an influence in this context, as does the tangible or intangible nature of the goods you offer.
From Single Channel to Omnichannel & Unified Commerce
Omnichannel as Distinct
from Multichannel and Cross-Channel and Unified Commerce
In essence, omnichannel is an evolution of the multichannel and cross-channel approaches widely implemented in companies today, in which the various channels and customer contact points are arranged next to each other. In order to attract the maximum attention of customers, in a multichannel strategy the individual channels are managed independently from each other. Cross-channel management, in contrast, is already based on an enhanced concept, in which content and audiences are coordinated across channels in a way that depends on the respective channel. In both approaches, however, the focus is still on the company and its products. This is also the main difference to the omnichannel approach, because during the transformation process to an omnichannel strategy, the customer moves to the center of all activities. The overarching goal is to create a customer-centric and seamless as well as fully integrated customer experience.
As of today, there is still a requirement for education, though, with 60% of the retail representatives surveyed in the Retail Reality Study 2022 stating that they did not even know the difference between multichannel and omnichannel. Even though 71% of the respondents said that they do not yet offer omnichannel services to their customers, 79% expressed that they find the features quite interesting.
In retail, many companies still adopt the two more traditional views, however, which is often reflected in the fact that brick-and-mortar stores and the company's ecommerce business are seen as two separate channels being managed by different departments. The channel-specific targets that accompany this often led to cannibalization effects between the online and offline channels. This silo structure within the company often impairs the integrated shopping experience for customers and thus causes moments of frustration in the context of the customer journey. These frustration moments, or pain points, often lead customers to abort the journey and turn to other brands. Positive experiences, on the other hand, foster trust, and loyalty. In a recent survey by Salesforce, 94% of the customers surveyed said that a good customer experience increases the probability of a further purchase, and 82% said that they would even recommend a company to a friend because of a good experience.
For some time now, the concept of Unified Commerce has also been making its way into the relevant publications around the topics of future shopping experiences and future retail. In line with a comprehensive omnichannel customer experience, Unified Commerce involves touchpoints interacting and interoperating with each other, rather than in isolated silos. The different channels are supported by a single platform that is an end-to-end solution covering all functions from marketing to fulfillment and is based on a single technology package – also called best of suite. As with the omnichannel approach, this enables companies to provide their customers with a seamless shopping experience and gives them a 360-degree view on how they interact with their company.