The core competencies of great businesses have changed.
Over the last five years, the business landscape has become more customer-centric than ever. The COVID-19 pandemic has exacerbated this trend, with consumers wanting a more seamless customer journey.
In fact, 9 out of 10 consumers want a seamless shopping experience, whether they're browsing online from a desktop or mobile app, on social media, by telephone, or in a brick-and-mortar store. They want personalized experiences, and brands now have the tools to provide them.
Omnichannel retail brands are oriented toward the omnichannel customer. Meaning, customer behavior drives the brand's next move. At the core, each customer engagement changes the next step in the user experience.
The brand is no longer trying to guide the customer toward a specific outcome. Instead, the brand and customer are now walking in lockstep.
Brands that win in this new customer-centric landscape will adopt an omnichannel approach to provide that seamless experience their customers want. As a result, those brands will show much higher customer satisfaction and brand loyalty.
What is the future of omnichannel retail ?
Customer experience lies at the heart of omnichannel retail. Brands that customers can relate to and that offer best-in-class service at every touchpoint in different channels are likely to retain those customers, driving value in the long run. Here are 5 tips to improve your store experience to meet customer expectations and stand out in the world of omnichannel retail.
1. Omnichannel marketing strategies that tell a story
As new products become easier to get to the market, new brands can also be spun up quicker than ever before. But along with that comes a crowded marketplace. And the challenge becomes standing out amongst all that competition.
As a result, marketers now find it more important to tell a story to stand out and ultimately sway their customers to choose their product over any other.
Think about it. More identical brands now sit side-by-side on the web and in physical retailers. So, what then is the differentiator?
Consumers tend to purchase what grabs their attention and resonates with them as far as branding, packaging, and story go. And the brand that resonates best tends to share the customer's values, leading to ongoing customer loyalty. In fact, 89% of customers stay loyal to brands that share their values.
In other words, the entire brand experience nowadays includes softer skills. 86% of shoppers prefer an authentic and honest brand personality on social media. This gives marketers more space to take risks.
For example, Everlane has won the hearts of consumers who value transparency with write-ups of each of their supplying factories and promoting the movement #KnowYourFactory on social media.
Social platforms, in particular, allow retailers to showcase their personalities. And in new channels like TikTok, this practice is often rewarded. (That's saying a lot as TikTok celebrates surpassing YouTube in viewing time per user.)
As a result, brands are betting on the social media platform. For example, Dunkin Donuts partnered with the #1 followed TikTok star, Charli D'Amelio.
Together, they post humorous content to engage Gen Z. As a result, Dunkin has increased their app downloads and cold brew sales, particularly after the company named two new drinks after the star.
2. Provide a seamless omnichannel experience for customers
Direct-to-consumer brands are finding new online channels need more touchpoints with consumers to create that positive, seamless customer experience.
Shopify, for example, now offers native integrations to sell via social media platforms like TikTok. It's also becoming more common for brands to sell via Amazon or even go back to selling wholesale at specific retailers. For example, Caraway sells their high-end cookware in West Elm and Crate and Barrel, among other physical stores.
And finding the equivalent multichannel distribution for your brand is critical.
Having an omnichannel approach to the customer journey builds your brand's awareness, helping you get and keep people's attention. It also allows the customer to, in an omnichannel environment, purchase your products where they're at.
On average, consumers need six touchpoints with brands before purchasing anything. Nearly half of them use more than four.
In other words, these different digital channels help distribute the product and the brand itself.
To do that, however, brands are betting more heavily on media. Email newsletters have long been part of the marketing repertoire, but brands are now creating content that goes beyond words in an inbox.
Podcasts and videos, for example, are becoming a pillar in telling a brand's story and building out its messaging:
- Trader Joe's runs a popular podcast that covers new recipes and answers questions like why cheese melts the way it does.
- Allbirds ran a limited series in 2019 on SiriusXM about sourcing their shoes' carbon-negative soles and more.
- We just launched a new podcast called The Checkout that interviews top DTC retail brands on how they achieved operational excellence.
Giving people different ways to have a positive customer experience offers brands a better chance of connecting and, ultimately, resonating with a customer, whether they're avid podcast listeners or loyal Twitter users.
3. Securing capital helps solve challenges
Manuel Koser, an investor in Cogsy, recently said: “If you have access to capital, you have an infinite amount of time to figure out the other challenges within the business.”
Meaning, finding ways of capitalizing the business is essential.
Some businesses do that through venture funding, either from institutionals or angels. Other companies find solutions through novel services. For example:
- Clear.co provides revenue-based cash advances to startups, SaaS businesses, and ecommerce stores.
- Shopify Capital offers financial support and funding to eligible ecommerce store owners.
- Settle provides ecommerce businesses with cash flow management, including factoring invoices.
And there are tons more options for securing capital where these came from. The challenge has become attracting and qualifying for that capital.
Luckily, any brand that excels in this new business ecosystem will also know their financials like the back of their hand. This includes data on your total market size, current traction, how your business model translates to revenue, and so on.
Having these numbers readily available will help you justify the capital you seek - whatever avenue you choose to get it.
4. Hire the best team in the world (literally)
This might sound obvious. But to hire a team, you must first attract team members.
Right now, the hiring market is as competitive as ever, and the best people want to work for the best brands.
As a result, your brand needs to consider:
- How to get in front of the most sought-after candidates.
- What package you'll need to offer to sign those candidates.
And similar to earning the attention of customers, attracting the right candidates starts with flexing your values and sharing your story.
For example, 89% of employees are more likely to recommend their workplace if they support their wellbeing. On top of that, nearly 80% of Millennials look at a company's people and culture fit first, followed closely by career potential.
And in a post-pandemic world, remote work is a very attractive and more attainable perk that brands can offer top talent. And it says without saying that you support employee wellbeing.
Not to mention that remote work widens your candidate pool, so you can find better, more diverse talent (another element that attracts top talent). In fact, Lattice projects that 42% of businesses plan to adjust their remote work policy to widen their recruitment pools in the coming years.
In terms of packaging remuneration, top brands find that a mix of positive culture and a strong financial offer attracts and retains top talent longer.
5. Operational excellence is key to an omnichannel strategy
Operational excellence will become more critical than ever.
Throughout 2021, we are experiencing a bull market that has been accelerated by the COVID-19 pandemic. In bull markets, industries grow so well that top-line growth plasters over deficient below-line unit economics, especially when they’re not great.
As a result, growth can be misleading. And it’s necessary to take a long, hard look at the cracks so you can fix them.
Brands that will win in this omnichannel commerce landscape are the ones who reach operational excellence. Meaning, the ones who figure out how to get the most of whatever they’ve put into the business.
Cogsy helps optimize these unit economics through accurate sales and inventory forecasting. The inventory management tool leverages real-time data to provide optimal purchase orders long before you run out of stock . As a result, fast-growing retail brands use it to manage their operations and supply chain in a proactive (rather than the traditional reactive) manner.
Right now, so many brands have capital tied up in extra inventory sitting in warehouses. But the ones that are flourishing have figured out how to free up that capital and use it for other growth channels instead.
In other words, operational excellence is the glue that takes the other four core competencies and creates a flywheel. And, as a result, it propels the best of brands toward growth and, ultimately, long-term success.
Getting a product to market is now easier than ever
The barriers to building a business are disappearing.
Take software, for example. Years ago, starting a software company required a massive upfront investment, making it unfathomable for most.
The ones that got off the ground were renting physical servers at a considerable cost. And the talent pool of engineers was small and hard to find.
But today, a startup can get $25k-$100k AWS credits to kickstart all the infrastructure needed to host their new app. And remote work has made it easy to tap into engineering talent from all markets (at a lower cost than hiring local, in some cases).
Similarly, marketers can now access more customer data easier than ever. Privacy issues aside, increased access to customer information, trends data, and engagement metrics helps optimize their marketing approach for the company's target audience. As a result, selling physical goods has become easier for ecommerce and physical stores.
And ecommerce platforms such as Shopify, WooCommerce, Etsy, and other niche platforms have matured, making it easier and more cost-efficient than ever to start selling.
Likewise, dropshipping has simplified sourcing products. And it doesn't require upfront working capital to stock inventory.
Not to mention sourcing products and finding quality suppliers is more transparent than ever. For example, with Import Yeti, anyone can search the US Customs sea shipment records.
If you know your competitor's legal entity, you can see where they're sourcing products, when they received shipments, and even the product information for everything in each shipment.
In the past, creating a product and getting it to market was the tricky part that few could figure out. And overcoming those logistical obstacles successfully was a core competency.
But now, creating the product and getting it to market is easier than ever. And because of this, the product you sell has become less significant, and your brand more and more.
Best-in-class brands will create the best omnichannel customer experiences
Putting the customer at the center of a brand’s focus creates immense growth opportunities. Consider these statistics:
- Omnichannel shoppers have a 30% higher lifetime value than those who shop using only one channel.
- Purchase frequency is 250% higher on omnichannel versus single channel. And the average order value is 13% more per order on omnichannel.
- Customer retention rates are 90% higher for omnichannel vs. single channel.
The core competencies brands need to prosper are different today than even five years ago.
To successfully pull off an omnichannel strategy, brands need to build muscle around these five new core competencies:
- Telling a brand story that stands out.
- Gaining further distribution, both online and offline channels.
- Attracting and qualifying for capital.
- Hiring a great team.
- Achieving operational excellence.
Is your brand ready?