The Changing Face of Retail : The Era of Omnichannel and Connected Consumers
Whilst forecasts suggest that worldwide ecommerce sales will increase by 20.1% in 2014 to reach $1.500 trillion it isn’t over for bricks and mortar shopping just yet as the connected consumer moves to omnichannel retail.
The Changing Face of Retail
Since the launch of the web over two decades ago, the internet has led a dramatic shift in retail. Companies like Amazon have redefined how we shop, and since that point ecommerce has held a bigger and bigger share of the retail market. Growing globally by 17% year on year since 2007, forecasts now suggest that worldwide ecommerce sales will increase by 20.1% in 2014 to reach $1.500 trillion.
Not Over yet for Bricks and Mortar
But it isn’t over for bricks and mortar shopping yet. Research published in The Wall Street Journal shows that ecommerce sales still make up only a small proportion of total retail sales, accounting for just 5.8% of the $1,126.2 billion overall US sales in the last quarter of 2013. Instead we are seeing the modern connected and tech-aided consumer – with on-the-move wifi connectivity, smartphones, tablets, PCs, laptops, social media, and increasingly sophisticated expectations of product, service, convenience, value and environment – turning to omnichannel retail, as the lines between the physical and the virtual blur.
Integrating online and offline retail, omnichannel joins together bricks-and-mortar stores, online stores, mobile stores, mobile apps, social media, and click-and-collect in a seamless path before, during and after a purchase. With a customer-centric perspective, consumers are enabled to follow their most convenient route.
The Connected Consumer
In evidence of an overwhelming move to omnichannel, research shows that 80% of UK shoppers have reserved products online for collection in stores in the past year, 44% always research purchases on the internet before buying offline, 43% now use smartphones while on the move to compare prices and read product reviews, and just 4% never use the internet for product research. The study also showed customers expect to be able to return purchases through a different channel from the one they purchased through. In the UK, 1 in five ecommerce sales in the first quarter of 2013 came through a mobile device.
Opportunity for Retailers
For businesses, omnichannel retail offers vast opportunity to create an offering which is greater than any of its individual parts could be.
Physical spaces can create brand experiences that engage and inspire and excite, they can also build brand image. Using technology – in-store wifi, interactive screens, kiosks offering a broader selection of products, iPad payments, and anything and everything else – retailers can also work to create a seamless offering between their different channels, whilst also keeping the stores highly relevant. Burberry, Apple and Marks & Spencer’s are just a few of the brands utilising and executing these methods profitably.
Online only brands are also cashing in on some of the bricks and mortar potential launching pop-up shops. eBay’s “digital storefronts” of last year launched in New York and San Francisco, allowed customers to order items for same-day delivery, are yet another choice. Bigger retailers can also use the same methods to reach less convenient locations or to seize opportune moments.
The online channels can deliver stock management, efficiency, range and convenience. They will also extend a brand’s reach, whether nationally or internationally, keeping retailers connected to consumers, and driving traffic into their stores.
And so if retailers focus on creating this kind of seamless experience for consumers across their channels, the ecommerce boom could in fact position bricks and mortar at the centre of modern retail.
It’s a new age of retail. And it just started.