Brick & Mortar Retail and the Savvy Omnichannel Shoppers
There is no doubt that one of the fastest changing components of our industry is the customer piece – up until about five years ago we couldn’t stop talking about “Customer Service”, four years ago we started talking about “Customer Experience”. Now, I hear rumblings of “Customer Engagement”. All I know for sure is that the phrase “Customer Service” is a thing of the past. It is an expected, rightfully so, component of the interaction your customer has with your brand, regardless of how or where the interaction originated. We are seeing customers in a brick and mortar retail store on their smartphones checking if they can get a better price on the item that is right in front of them. Brands today need to have an omnichannel presence and the expectation on the store teams requires them to possess the ability to appeal to the customer’s need for instant gratification and their impulses through delivering a great, meaningful experience that compels them to buy this product – today – from the store.
OMNICHANNEL Retailing Defined
“In its most basic terms, omnichannel retailing means connected customers can shop for and purchase the same items across many different channels – in a retail store, on their home or laptop computers. Perhaps most importantly, on their connected mobile devices, which allow them to shop online for virtually anything, virtually everywhere: on the bus, on the street, in the parking lot, at the kitchen table, in bed. Even while standing in the middle of your sales floor.” [Source: Motorola].
More than 80% of brick-and-mortar retailers will have wireless networks available in their stores by 2017. – Motorola Solutions’ “Annual Holiday Shopping Survey Results,” December 2011
Nothing Sells Like Service
One critical piece of delivering results is making certain that your store teams have as much, if not more, information about your products as the customer has. Being able to answer the questions, overcome the objections, and communicate the benefits of your products to your customers is key to capturing the attention and trust of your customer.
Within 5 years, retailers expect more than half of all customer transactions will be completed using self-checkout on mobile devices. – Source: Motorola Solutions’ “Retail Vision Survey,” May 2012
By 2017, more than half of retailers plan to make use of psychographic metrics using social network data. – [Source: Motorola Solutions’ “Retail Vision Survey,” May 2012]
Survival Of The Fittest [AKA: Adaptability]
According to Ruchika Kumar, Founder of Boutiika Labs, “The growth of online sales has threatened the traditional brick & mortar business, but it is possible to not just survive but succeed. The biggest challenge is adapting to being a omni-channel experience. Brick & mortar retailers have been catapulted into a multi-channel shopping cycle due to changing customer behaviors and advanced technology. ”
Forrester predicts that by 2017, 60% of all retail transactions in the United States “will involve the Internet in some way.”
It is estimated that customers who respond to ‘being engaged’ spend 30% more on average than those who are not. This means customer engagement is a big deal, especially if customer loyalty is important in your industry and if business growth is a must. Customer engagement innovates, develops intimacy and generates growth. [Source: Cyril Coste]
A focus on customer engagement and commitment can significantly decrease in-store shopping cart abandonment costs. When we shortcut or ignore training and development because we are making the decision to erode the customer experience in some way“This is the in-store equivalent to the online phenomenon of shopping cart abandonment. A study by Business Insider estimated that $4 trillion of merchandise was left unpurchased by online shoppers in 2014. And while there’s no easy way to quantify the amount of sales are lost when frustrated customers change their minds about making a purchase in physical stores, when 75% of Internet shoppers are willing to walk away the items in their online cart, they’re predisposed to exhibiting shopping cart abandonment behaviors in physical stores as well.” [Source: About Money]
According to creating a seamless retail customer experience, sponsored by Panasonic, more than half (51%) of consumers say their customer experience has improved over the past three years. [Source: The Economist Intelligence Unit]. Which is great news! What I like about this statistic is that we still have ample opportunity to deliver great experiences that resonate with and reflect the brand promise [Mission Statement and Company Values] for customers.
Most retailers (two-thirds) still look at simple sales volumes to measure performance rather than longer-term indicators, such as length of customer engagement (only 27% of retailers). To be ready to overcome the impact that omnichannel presence has, we need to be proactively, as retail leaders, on a larger scale [outside our department, store, district, region, etc.] We need to understand and communicate the changes and expectations these alternative business platforms create for our customer’s perception of our business and work with our teams to support the store-level experience.
So, why are all of these statistics and facts important? Because as retailers inside retail organization’s brick and mortar stores, we need to be fully aware of what we are working with. In this case we are working in an environment that demands selling, a high-level of product knowledge, and a ruthless and passionate focus on customer engagement and appreciation. Customers make little distinction between the various platforms on offer today and judge companies on their overall performance. They look at the whole transaction. They want simplicity, speed, and accuracy across all channels. They will, without hesitation, walk away from companies that fail to satisfy their non-negotiables. Three-quarters of consumers say that they will stop doing business with a company following bad experience.
In retail we have a terrible habit establishing a criteria of hiring “warm bodies” at the supervisor level and selling team member level of the business and having them train “on-the-job” [aka: sink or swim]. We aren’t making smart investments into onboarding, developing, providing training and learning resources to these critical roles, when it is most important. We allow our team members with the greatest amount of customer facing time to “wing it”. These are the obstacles we are facing that we need to change quickly to protect and support our retail organizations.
Company executives say the biggest obstacles to better customer service are organizational, rather than technical. They see silos within the organization as the biggest hurdle. Executive and senior level leadership is not keeping pace with the organizations presence on various platforms which means at times critical communication is neglected to support the customer’s expectations of their brand experience. As retail leaders we need to be proactively seeking out the parallels and how we can support the other platforms of the business that exist and create strategies with our teams to overcome the obstacles.
Obstacles To Opportunity
According to a shopping report conducted by SapientNitro, and Gfk Roper, 51% of respondents admitted to showrooming. [Source: SapientNitro]
Though a majority of retailers see showrooming and omnichannel as an obstacle to business, it presents a unique opportunity to blend physical and digital marketing and compelling service to amplify sales. Showrooming and other emerging consumer trends have placed new operational and tech challenges on all retail brands. Showrooming trends are here to stay will continue to evolve as more customers embrace the omnichannel existence of their favorite products and brands. Since we are constantly being introduced to new digital platforms, the communication and interactive process has become fragmented, but it is still fundamentally connected in nature and must be used to create a seamless and focused “experience” to the individual customers.
Brick and mortar retail will thrive by offering an unequaled level of customer experience and personalized engagement. This is an area that has built the reputation of many amazing brands [that are still around and flourishing today]. Retail organizations can embrace the experience and engagement approach by offering engagement and experience to boost retention and reduce customer churn. [Customer churn is the proportion of customers who leave your business during a given time period, normally the course of a year.] By truly shaping the store team’s understanding of the brand [through continuous training, development, and exceptional communication] to reflect the brand’s theme, customers will buy into the experience and leave feeling included, engaged and appreciated. To truly deliver on “brand promise”, retail organizations and their employees should look to their customer’s behavior to develop strategies to elevate the level of service that consumers in their retail category have come to appreciate and advocate.
Retail leadership today is all about turning obstacles into opportunities for their teams. There is no doubt that the teams that have been using the weather, local – national – and televised sporting events, and their customer behaviors to excuse soft business results will try to use the availability of the organizations/brand’s online presence to further excuse their performance. The true test of any leader’s mettle to to extract all of these “go-to excuses” as impediments to the business and use them as an opportunity to elevate the performance of their team in customer experience, business metrics, and overall retail excellence that delivers great results to the organization consistently.